BUSH BACKPEDDLING FASTER THAN LANCE ARMSTRONG
UPDATE - Bush seeks to quell election-year budget rebellion
Friday January 30, 7:37 pm ET
By Adam Entous
(Recasts with Republican reaction, adds details)
WASHINGTON, Jan 30 (Reuters) - President George W. Bush came under pressure
from his fiscally conservative base on Friday to make deeper spending cuts after the
White House acknowledged its newly-enacted prescription drug plan would cost far
more than expected.
Facing the prospect of an election-year rebellion from members of his own Republican
party, Bush promised to halve the deficit over five years in spite of the additional cost.
The fiscal 2005 budget he will send to Congress on Monday will call for limiting
spending growth outside of defense and homeland security to 0.5 percent -- well below
the rate of inflation.
But his budget will also acknowledge that adding prescription drug coverage to
Medicare would cost at least $530 billion over 10 years -- 33 percent more than the
$400 billion Congress and the administration had promised when the law was approved
less than two months ago.
The higher estimate cast doubt on Bush's plans to cut the deficit in half by 2009. Many
budget experts -- including some of Bush's allies in Congress -- were already skeptical.
But Bush insisted: "The budget we'll submit on Monday does fulfill that promise that will
reduce the deficit in half." The White House expects this year's budget deficit to reach a
record $521 billion -- a potential election-year liability.
Arizona Republican Rep. Jeff Flake urged the president to take a harder line on
spending, and said he may be able to start getting lawmakers behind putting caps on
entitlement growth.
Conservatives urged Bush to back up his words by threatening to veto costly highway
and energy bills.
Traditional allies of the Republican administration, many fiscal conservatives opposed
the Medicare plan, in part because of the huge long-term cost of providing drugs to
seniors as the baby boom generation retires.
They seized on the White House's new cost estimate as vindication, and warned that
Bush could face an election-year backlash over spending.
"The real question is what did the president know and when did he know it," said
Stephen Moore, president of the Club for Growth, a politically powerful conservative
group.
He called the new cost estimate a "financial scandal."
The White House denied it intentionally underestimated the cost of the Medicare law to
pick up votes during the congressional debate.
Bush told reporters he learned about the new estimate two weeks ago, and asserted
that increased competition would eventually hold down the cost of Medicare.
While he said his 2005 budget would call for cutting the deficit in half over five years,
Bush put the onus on the Republican-controlled Congress to hold the line on spending.
"Congress is now going to have to work with us to make sure that we set priorities and
are fiscally wise ... I'm confident they can do that, if they're willing to make tough
choices," Bush told reporters.
Officials said the discrepancy between the drug cost estimates reflected long-standing
differences in assumptions the White House and Congress make about the program,
particularly how many people will participate and how much it will help to reduce drug
costs.
But conservatives were not appeased.
They said Bush has overseen a nearly 25 percent surge in spending over the last
three years -- the fastest pace since the Johnson administration of the mid-1960s.
Republican lawmakers who oversee the spending process could also rebel.
They warned this week that Bush's plan to freeze some federal spending could mean
painful cuts in programs ranging from veterans' health to medical research.
CC |
