Senate Joins House in Endorsing Plan To Balance the Budget by 2002

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The Senate joined the House last week in endorsing a 1996 budget resolution that calls for balancing the federal budget over seven years by slowing spending in scores of areas, including education.

Republicans touted their plan, which passed 57 to 42, as historic, even though it calls for more modest cuts than a spending plan endorsed by the House earlier this month. (See Education Week, 5/24/95.)

Differences between the two versions will be reconciled by a conference committee in the coming weeks.

"It's a budget for today and a budget for tomorrow," said Sen. Pete V. Domenici, the Republican from New Mexico who chairs the Senate Budget Committee. "This is the first time in 25 years that grown-up Americans are going to pay their bill."

At a news briefing, Mr. Domenici declined to comment on the likely outcome of the conference.

Three Democrats joined all of the chamber's Republicans in supporting the Senate plan, which would reduce spending on the category that includes education, job training, and social services by $10 billion in its first year, which begins Oct. 1, compared with spending in the current fiscal year.

Although few amendments were adopted, last week's debate did reduce the magnitude of cuts in college-loan interest subsidies proposed by the budget plan.

Budget resolutions set binding spending limits on broad categories of spending. However, while the documents also suggest which programs should be funded, those suggestions are not binding on the appropriations committees that make allocations to specific programs.

'A Devil's Bargain'

As they have over nearly a month of budgetary debate, Democrats criticized the plan because it calls for using an estimated $170 billion in interest savings produced by spending cuts to enact tax breaks, while at the same time cutting back on education and social programs.

"It's a budget that makes a devil's bargain over tax cuts at a time when we should be appealing to our better angels," said Sen. Jim Exon, D-Neb., the ranking minority member on the Budget Committee.

The Democratic leadership did not endorse an alternative budget. And when the Democrats were forced to vote on President Clinton's proposed 1996 budget, which offered no path to a balanced budget, they joined Republicans in dousing it, 99 to 0.

In a surprise development last week, President Clinton said he would propose his own 10-year balanced-budget plan, but later declined to elaborate on his intentions.

Mr. Clinton has said that his participation in budget negotiations would be contingent on rolling back proposed cuts in education programs and Medicare, and reducing the budget plans' proposed tax breaks.

A coalition of Democrats, led by Sen. Kent Conrad, D-N.D., introduced an alternative that would have balanced the federal budget by 2004. The "fair-share plan," which proposed closing tax loopholes and did not include a tax cut, was defeated 60 to 39.

Some Subsidies Restored

More than 50 amendments were offered during a week of Senate debate, most of them coming in the closing hours before the final vote on May 25.

One of the few amendments that passed was a bipartisan effort to restore $9.4 billion of the $13.5 billion cuts in student-loan interest subsidies the seven-year budget plan called for.

The amendment, sponsored by Sen. Olympia J. Snowe, R-Maine, and Sen. Paul Simon, D-Ill., calls for eliminating a tax exemption currently enjoyed by some businesses with overseas dealings. It passed 67 to 33.

But several other attempts to bolster education spending were unsuccessful.

Sen. Christopher J. Dodd, D-Conn., sponsored an amendment that would have restored $28 billion over seven years to the category that includes education, with the intent that $16 billion would go to discretionary education programs and $12 billion to student loans. It failed 51 to 48.

Sen. Tom Harkin, D-Iowa, and Sen. Dale Bumpers, D-Ark., proposed freezing defense spending over seven years while shifting the savings to education and job training. The amendment was rejected 71 to 28.

Sen. Edward M. Kennedy, D-Mass., sponsored an amendment that called for $22 billion in additional spending on elementary and secondary education programs over seven years and an additional $6 billion for student loans. It was rejected 58 to 41.

A separate amendment from Mr. Kennedy, calling for an additional $8 billion over seven years for Pell grants failed 55 to 44.

Vol. 14, Issue 36

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