Bush Defends Embattled Budget Plan

His budget under fire in the evenly divided Senate, President Bush defended his fiscal plans on Thursday and urged senators to reconsider their vote to shrink his proposed $1.6 trillion, 10-year tax cut. 

A day before Senate leaders plan a vote on final passage of a $1.94 trillion budget reflecting Bush's tax and spending goals, Bush reiterated his argument that his tax cut would help bolster the economy.

"I urge the senators, when they cast the vote tomorrow, to remember there's a lot of people in our country who are beginning to hurt," he told a gathering of newspaper editors.

Bush's remarks came a day after the Senate voted tentatively to reduce the tax cut to about $1.15 trillion. Republican leaders are intent on restoring it to as close to its original size as possible.

"No one vote is decisive" in Congress' winding budget process, he said.

Wednesday's vote — and a warning by moderate Republican Sen. James Jeffords of Vermont that he expected to vote against the GOP budget "unless a miracle occurs" — ignited an intensive White House recovery effort. Top Republicans predicted they would prevail and push the budget through the Senate by week's end.

"I think we can restore a significant amount, maybe all" of the tax cut, said Senate Majority Whip Don Nickles, R-Okla. "We'll see. We'll pass the maximum tax cut we can."

White House officials also were upbeat.

"The president looks forward to continuing his work with the Senate to provide real, meaningful tax relief to the American people as he proposed in his budget," spokesman Ari Fleischer said.

But privately, one senior adviser conceded the education vote was a major legislative setback and public relations blow heading into next week, when the details of Bush's budget cuts will be revealed.

Democrats celebrated the day's events as an indication that the president's $1.6 trillion plan had run out of steam. Now, they said, it was time for the GOP to negotiate with them for a smaller tax reduction and other budget issues.

Senate Minority Leader Tom Daschle, D-S.D., called the day "a repudiation of the president's policies and priorities," adding, "We're getting further and further away from the administration's budget."

Wednesday's double setback made it the worst day yet for Bush's budget and his tax proposal, which has been the centerpiece of his economic program since he unveiled it in December 1999 during his battle for the GOP presidential nomination. Bush has frequently said $1.6 trillion is "just right."

Congress' budget is a framework that sets overall tax and spending limits. The details are set in separate, later bills, but budget battles are fierce because they let each party make statements about their priorities.

The House, where majority Republicans have an easier time controlling most debates, approved a similar budget with ease last week. And Wednesday, it used a 274-154 vote to push through the final component of Bush's tax plan, a bill phasing out of the estate tax.

Though the Senate is split 50-50 between the parties, Republicans have the advantage because Vice President Dick Cheney can break tie votes and deliver victories for the White House. Besides Jeffords, just one senator from each party — Zell Miller, D-Ga., and Lincoln Chafee, R-R.I. — is considered sure to cross party lines on final passage.

But the budget has had a "Perils of Pauline" ride so far in the Senate, narrowly averting several Democratic efforts to skim money from the tax cut to use for farmers, prescription drugs, defense and other programs.

Bush's luck ran out on an amendment by Sen. Tom Harkin, D-Iowa, to shift tax cut funds to education.

Chafee, Jeffords and Sen. Arlen Specter, R-Pa., voted for the Democratic amendment, while Miller was the only Democrat to oppose it. At the last minute, Senate Majority Leader Trent Lott, R-Miss., also voted for the Democratic provision, which under Senate rules gives him the right to demand a new vote on the amendment.

Jeffords wants to increase special education spending to $180 billion over the next decade. It is receiving $6.3 billion this year. Top Republicans have offered him more than $100 billion.

Specter told a reporter that he would "listen to what Lott has to say" if the majority leader works out an agreement with Jeffords.

The Vermont Republican embraced a $1.25 trillion tax cut proposed by moderate Democratic senators led by Sen. John Breaux, D-La., along with Chafee. That falls between Bush's proposal and a $750 billion package supported by Democratic leaders.