House to try passing spending cuts this week

By Richard Cowan

WASHINGTON (Reuters) – The U.S. House of Representatives
this week will try to approve nearly $54 billion in spending
cuts, and Republican leaders on Monday were still looking at
ways to fine-tune the measure to avert defeat.

The budget bill might be debated on the House floor on
Thursday, according to a senior House Republican aide.

But the aide, who asked not to be identified, said House
leaders were still “figuring out how that package clears the
House floor” and were discussing whether any of the more
controversial elements of the package might be jettisoned.

Under pressure from Republican conservatives to find more
savings over five years than the $36 billion approved by the
Senate last week, the House legislation would reduce the number
of legal immigrants who would qualify for food stamps and
require tougher application procedures for all others wanting
food stamps.

Those savings, coupled with controversial plans to open
previously protected areas to oil drilling and to save money in
child welfare and health care for the poor, have made many
Republicans nervous.

A budget debate to change federal programs for the poor
comes as Republicans in Congress are beginning to move tax-cut
legislation that might include renewed breaks for the rich. The
juxtaposition puts more than a dozen moderate House Republicans
in a difficult spot.

On Tuesday, the Senate Finance Committee is expected to
unveil around $60 billion in net tax cuts. A spokeswoman for
the committee did not say whether they would include an
extension of capital gains and dividends tax cuts expiring
after 2008.

CONCERNS ABOUT SPENDING-CUTS

Moderate Republican Rep. Michael Castle of Delaware has “a
lot of outstanding concerns” with the spending-cut bill, said
spokeswoman Elizabeth Wenk.

She rattled off the Alaska and offshore oil drilling
proposals, food stamp cuts and Medicare and Medicaid changes in
that list.

A group of House Republican moderates are supposed to meet
on Wednesday to discuss the budget bill and their attitude on
the way out of that meeting could indicate just how difficult
of a fight there will be on the legislation, or whether it has
to be delayed.

Republican conservatives ramped up their quest for
deeper-than-planned spending cuts to mandatory programs after
watching the U.S budget deficit hit a record $412 billion in
fiscal 2004, before falling back to a still high $319 billion
the next year.

Their spending-cut goals have been complicated, however, by
huge U.S. expenditures on the Iraq war and Gulf Coast hurricane
cleanup. The $62 billion in emergency hurricane aid passed by
Congress did, however, give conservatives a new opportunity for
underscoring out-of-control deficit-spending.

Besides reducing costs on mandatory programs, conservatives
also have been calling for across-the-board cuts to all, or
most other federal programs.