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September 15, 2000, Friday, Late Edition -
Final
SECTION: Section A; Page 26; Column 1; National
Desk
LENGTH: 826 words
HEADLINE: G.O.P. Debt-Reduction Plan Has a Rapid Impact
BYLINE: By STEVEN A. HOLMES
DATELINE: WASHINGTON, Sept. 14
BODY:
Democrats deride it as a
gimmick. Republicans acknowledge that it is a Plan B fallback position from
their cherished tax cuts. Lawmakers on both sides of the aisle give it little
chance of passing the Senate.
Yet only two days after Republicans
unveiled their proposal to commit 90 percent of the budget surplus in the next
fiscal year to reducing the national debt, the plan is already having a
political and policy impact.
Though the Clinton administration and
Democrats in Congress have scorned it as an unneeded law, Democratic lawmakers
are loath to vote against it for fear of being tagged as not favoring reduction
of the national debt. Today Democrats joined Republicans in the House Ways and
Means Committee in unanimously passing a bill to adopt the so-called 90-10 plan.
The measure would require that the anticipated $198 billion surplus in
the Social Security and Medicare trust funds be applied toward retiring the
government's publicly held debt. It would also set up a separate account and
transfer $42 billion of the non-Social Security and non-Medicare surplus into
it. That money would also be used to retire debt.
But Democrats warn
that because the measure calls for such action for only one year, Republicans
will try to divert more of the following year's surplus into tax cuts if they
gain control of the White House. They point out that Gov. George W. Bush, the
Republican presidential nominee, has pledged to enact a $1.3 trillion tax cut
spread out over 10 years.
Democrats also say that the Social Security
and Medicare surpluses are considered sacrosanct and in recent years have only
been used for debt reduction and that Mr. Clinton's spending proposals still
leave room to pay down the national debt.
As a result, Democrats say,
the Republicans' measure is not needed.
"We think this bill is pretty
meaningless," said Representative Robert T. Matsui, a California Democrat who is
a member of the committee. "But we know the political effort that will be made
on the part of Republicans, and we didn't want to put our members who are in
competitive races at a disadvantage."
Under the Republican proposal, the
roughly $28 billion that would remain in the budget after debt reduction would
be used for tax cuts or for federal spending above the budget ceilings adopted
by Congress last April. For the moment, Republican leaders envision providing
$14 billion for spending increases and $14 billion for tax cuts.
With
Republicans having committed themselves so publicly to "90-10," Congressional
leaders may be less flexible in their negotiations with the White House, which
Democrats note with some concern.
At today's vote in the Ways and Means
Committee, the panel's chairman, Representative Bill Archer, Republican of
Texas, noted that in 1998 Republicans, eager for Congress to adjourn so they
could go home and campaign for re-election, went along with President Clinton's
demands for increased spending.
Mr. Archer said he felt that the 90-10
plan would help Republicans avoid caving in to Mr. Clinton -- an action that
some political analysts say hurt them at the polls.
Already, Democrats
say the Republicans' debt-reduction proposal is having an effect on negotiations
between the White House and Congress on spending bills.
Even though the
White House and Congressional Republicans were only $30 million apart, talks
over a $15.6 billion measure to finance the Treasury Department, the Internal
Revenue Service, construction of new federal courthouses, and enhanced
counterterrorism measures stalled today because the bill contained a repeal of
the telephone excise tax that would cost the Treasury about $5 billion a year.
Representative Richard A. Gephardt of Missouri, the House minority
leader, said: "The administration is saying, 'Look we got this 90-10 thing. We
don't want to sign a bill with a telephone tax repeal if we
have to commit 25 percent of what's left of the surplus into this tax cut. There
may be other tax cuts that we would prefer and there may be other initiatives
that we want."
Republicans scoff at the notion that their plan caused
problems with the spending bill. The real difficulty, they say, is that the
White House is tossing up roadblocks to Congress's completing work on the
budget.
"Last week it was not enough money for the I.R.S., then it was
courthouses, then it was counterterrorism," said Representative Jim Kolbe,
Republican of Arizona. "Now that 90-10 is on the table, suddenly it's 90-10. No
matter how many hurdles you go over, there's always one more."
Without
an agreement with the White House, Republicans brought the Treasury financing
bill to the House floor, bundling it with a $2.5 billion spending measure to
finance the legislative branch. The package squeaked by, 212 to 209.
The
House also approved a $414 million measure financing the District of Columbia's
government, voting 217 to 207, largely along party lines.
http://www.nytimes.com
GRAPHIC: Photo: Speaker
J. Dennis Hastert, with charter school students at a Capitol news conference
yesterday, used the occasion to urge President Clinton to back a Republican plan
to reduce the national debt. (Susana Raab for The New York
Times)
LANGUAGE:
ENGLISH
LOAD-DATE: September 15, 2000
