House passes Republican plan for bigger deficits

House Republican leaders have won passage by a vote of 217 to 215 of a budget reconciliation package which cuts critical programs such as student loans, aid to farmers and Medicaid while doing nothing to curb the expanding deficit. While Congressional Republicans hailed the measure as a courageous exercise in fiscal responsibility, the budget bill only covered most of the costs of $57 billion in tax cuts. Congressman Marion Berry of Arkansas, a leading member of the House Blue Dog Democrats explained why he vigorously opposed the Republican-backed budget plan.
"The Republicans are deceiving the American people by using fiscally responsible rhetoric to hide billions of dollars in tax breaks for the wealthiest Americans," said Congressman Berry. "No matter how you package this reconciliation bill, it is still one big Christmas gift for the richest 1% of America."
The Republican leadership decided to go forward with a budget reconciliation package after enacting large emergency appropriations to fund recovery efforts for hurricanes Katrina and Rita. Each committee voted on a series of cuts to reign spending in by $53.7 billion. The largest proposed cuts include $14.3 billion from student loans, $11.9 billion from Medicaid, and $3.7 billion from agriculture programs.
With the budget reconciliation now approved, House Leadership intends to proceed today with a tax-cut package targeted at the wealthiest Americans. The package, which costs an estimated $56.6 billion, would make the tax cuts for the top 1% of Americans permanent and extend the lower tax rate for capital gains and dividends. The total cost of the tax measure exceeds the savings in the budget reconciliation package and only adds to the deficit for 2006.
"If $8 trillion of debt does not get this Administration's attention, I am afraid to see what finally does," said Congressman Berry. "We are going to drive this economy into the ground and leave our children and grandchildren to clean up the mess if we don't start making responsible decisions now about spending."
The U.S. Senate has approved a similar budget reconciliation package with $36 billion in savings and is also expected to consider a tax-cut measure in the coming days that will cost $59.6 billion. A conference committee must work out the differences between the House and Senate versions before Congress votes on the final reconciliation measure.