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McCain, Snowe, Collins, Chafee blocking path for tax relief

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Republican ‘Moderates’ Block Budget Resolution

McCain, Snowe, Collins, Chafee blocking path for tax relief

Four moderate and liberal Republican senators have apparently prevented Congress from passing a budget for fiscal 2005. Senators Lincoln Chafee (R.-R.I.), Olympia Snowe (R.-Maine), John McCain (R.-Ariz.) and Susan Collins (R.-Maine) have insisted unyieldingly on a provision that would prevent several of President Bush’s tax cuts from being extended permanently. Their intransigence, combined with the GOP’s slim 51-to-48 Senate majority, has caused the Senate leadership to abandon hopes of passing a bicameral budget this year, even though the House and Senate have both passed separate versions of the budget. “For three months, conservatives have stood by and supported [Senate Budget Chairman Don] Nickles [R.-Okla.] as he worked to reach a deal,” a conservative GOP Senate aide told HUMAN EVENTS. “Unfortunately, a few Republicans have teamed up with the Democrats to make demands that are unacceptable.” The moderates demanded to implement so-called “pay-as-you-go,” or PayGo, rules. If enshrined in a congressional budget resolution, PayGo would allow any senator to raise a “point of order” against provisions that increase overall spending or decrease tax revenue. Such a point of order requires 60 votes to overcome. Under PayGo, in other words, a mere 40 senators could effectively raise taxes by preventing the extension of tax cuts that are scheduled to expire. To meet the moderates’ demands, the Senate leadership would have had to forgo votes on extending or making permanent several of the tax cuts Bush has signed since 2001. Republicans hope to benefit from holding such tax votes during an election year. Whether or not the Senate passes a budget resolution for fiscal 2005, there will be a ceiling on overall fiscal year 2005 discretionary spending because last year’s budget resolution contained overall spending caps for two years instead of one. Without a budget resolution this year, the Republican leadership will likely try to roll most government spending into an omnibus bill and keep it under the two-year spending cap. “We basically would be living off the spending cap we put into place last year,” said Kara Duckworth, a spokeswoman for Nickles. By putting most of the appropriations into a single bill, floor managers can ensure that overall discretionary spending does not exceed that $814-billion limit. Amendments that bust that cap would need a 60-vote supermajority. Meanwhile, Duckworth said, Republicans will pursue a bill to make some of Bush’s tax cuts permanent–including the 10% tax bracket, the child tax credit, and the abolition of the marriage penalty. These three provisions are more palatable to Senate liberals than others, such as the cutting of top marginal rates and the permanent abolition of the death tax. But a bicameral budget resolution–which cannot be filibustered in the Senate–is also the vehicle for passing temporary tax cuts, so no such cuts are likely this year. Ironically, the four moderate senators who have blocked the budget deal over PayGo have voted on several occasions to override PayGo rules. On May 12, Chafee, Snowe, Collins, and McCain voted to skirt the PayGo rules and add an extra $1.2 billion in federal special education funding. All four did the same on May 11, voting to extend unemployment benefits. Collins and Snowe also voted to override PayGo on May 4 to give “trade adjustment assistance” to workers whose jobs were shipped overseas.

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Mr. Freddoso is the senior political reporter for the Evans-Novak Political Report.

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