House Republicans fail to reach spending cut deal

By Richard Cowan

WASHINGTON (Reuters) – Republican leaders in the U.S. House
of Representatives on Wednesday failed to round up enough
support for deeper domestic spending cuts, forcing them to call
off a vote on legislation they had hoped to pass on Thursday.

“We shouldn’t expect that vote tomorrow,” said Heidi
Armstrong, a spokeswoman for Acting Majority Leader Roy Blunt,
a Missouri Republican. Armstrong said she did not know when the
vote might be rescheduled.

Blunt, who has temporarily replaced indicted House Majority
Leader Tom DeLay, had hoped to win House approval this week on
a plan to cut mandatory federal programs, such as Medicare,
Medicaid and student loans, by $50 billion over the next five
years, instead of the previously planned $35 billion.

Rep. Nancy Pelosi of California, the House Democratic
leader, said the additional spending cuts “would have
devastating consequences on those who need our help most —
hurricane survivors, students, seniors and rural Americans.”

House Speaker Dennis Hastert, an Illinois Republican, shot
back, saying, “It’s not surprising that Democratic leaders
would be opposed to a spending restraint amendment.” He added
that Democrats have “one strategy: to tax and spend.”

But for now, enough House Republicans also were too
uncomfortable with the added spending cuts to let the measure
move forward.

Republican senators said they were making progress on their
version of a package to achieve $35 billion in savings over
five years.

“It’s coming on board well,” Senate Majority Leader Bill
Frist told reporters. But the Tennessee Republican added that a
deal might not be complete until early next week.

Oregon Republican Sen. Gordon Smith said that Senate
Finance Republicans were “on the cusp” of a deal on $10 billion
in savings from Medicare and Medicaid as part of the $35
billion in spending reductions.

‘IT’S A LOT OF CUTS’

Sen. Max Baucus of Montana, the top Democrat on the
committee, said he had not seen the Republican agreement but it
was “doubtful” that he or any other Democrat on the panel would
vote for it. “It’s a lot of cuts,” he said.

In the House, leaders have put off until later this year
another proposal, for a 2 percent across-the-board reduction in
government spending. The idea ran into resistance from many
lawmakers who sought to exempt some programs.

The drive to cut government spending beyond the goals set
last spring in a budget blueprint has been sparked by a revolt
among Republican conservatives.

Their efforts got a boost when Congress hurriedly approved
$62.3 billion in emergency funds for Gulf Coast states damaged
by Hurricane Katrina. Those funds would add to an already large
U.S. budget deficit.

By the end of this month, the White House is expected to
submit yet another request for hurricane aid. A Senate aide
said that while the figure was “still fluid,” it was thought to
be around $20 billion.

The Republican budget blueprint calls for $70 billion in
tax cuts over five years, which would add about $35 billion to
the U.S. debt unless more spending reductions are passed.

Rep. Mike Pence, an Indiana Republican leading the charge
for deeper spending cuts, said he was encouraged by Hastert’s
attempts to enact such cuts. But he added, “There’s a lot of
miles between the saying and the doing here on Capitol Hill.”

Pence has warned that conservatives might try to block
future hurricane relief funds unless there is progress toward
paying for the aid with spending cuts.