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Congress Opens Hearings on President Bush’s Budget Proposal

Congress opened hearings Tuesday on President Bush's $2.57 trillion budget proposal. Kwame Holman reports on the emerging battle in the Congress.

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  • KWAME HOLMAN:

    Top members of the Bush administration went to Capitol Hill this morning to promote and defend the president's budget amid a chorus of questions from both parties.

    Appearing before the House Budget Committee, the president's budget director Josh Bolten said the main goals of the $2.5 trillion spending plan are fighting terrorism at home and abroad.

  • JOSHUA BOLTEN:

    In order to sustain our economic expansion, we must exercise even greater spending restraint than in the past. When the federal government focuses on its priorities and limits the resources it takes from the private sector, the result is a stronger and more productive economy. The president's 2006 budget proposes that enhanced restraint.

  • KWAME HOLMAN:

    But top committee Democrat John Spratt said the president's budget does not attack the deficit as advertised.

  • REP. JOHN SPRATT:

    This budget increases defense by $19 billion. It increases international affairs. It increases homeland security, and instead of paying for these increases, meritorious as they may be, instead of paying for them, it still calls for substantial tax cuts, notwithstanding the fact that we have huge, gaping deficits. Given that arithmetic, there's no mystery why we have huge deficits.

  • KWAME HOLMAN:

    Budget committee chairman Jim Nussle jumped in, noting Congress made the tax and spending decisions that yielded current deficits.

  • REP. JIM NUSSLE:

    We're going to do whatever it takes to prosecute this war against the terrorists. That's what we said back then. And now we're acting like, "oh, gosh, I don't know how we got here. I don't know how we got to this deficit." Wake up, folks. We made deliberate decisions.

  • KWAME HOLMAN:

    Nonetheless, Nussle suggested the White House will have to help the Republican majority in Congress control the spending appetites of both parties.

  • REP. JIM NUSSLE:

    There's a number of us that are willing to make some tough decisions, but I think we're going to need a little help from the administration. What are you willing to recommend to the president to enforce the budget that you've put up, at least in the top line or the — enforce the fences that are part of making sure that this budget is fiscally responsible?

  • JOSHUA BOLTEN:

    Mr. Chairman, we heard many of the same sorts of comments a year ago, you will recall. But what the Congress delivered was in fact a budget that held overall discretionary growth around 4 percent.

    And the non-defense portion of that just above 1 percent, as you pointed out in your opening remarks. So we got what we asked for last year in the big perspective.

  • KWAME HOLMAN:

    Leading congressional democrats have called the cutbacks proposed in the president's massive budget document, "draconian," noting that some 150 federal programs would be eliminated or drastically scaled back.

    They also point out that the growth of Medicaid, the health program for the poor, would be restrained; funding of health care for veterans would increase less than inflation, and some would face higher drug costs; and grants for local schools, vocational education, anti-drug efforts, and literacy programs would be cut back.

    [Connecticut] Democrat [Rosa DeLauro] said the proposed cuts will come at the expense of the social safety net that low-income families rely on.

  • REP. ROSA DELAURO:

    The decision to eviscerate Medicaid by $60 billion over ten years will leave many low-income families with nowhere to turn for medical care and many seniors with no way to afford long-term care. A decrease in food stamps by more than $1 billion over ten years, making it more difficult, even impossible, for low-income families to qualify.

  • KWAME HOLMAN:

    Bolten said the cuts to Medicaid are incremental and long-term, and are necessary because of rising health care costs. Texas Democrat Chet Edwards focused on the proposed reductions in prescription drug coverage for veterans.

  • REP. CHET EDWARDS:

    They're going to have to pay $250 a year for an enrollment fee if they make over $30,000 a year and have a spouse and one child, and they're going to have to pay more than double the rate for prescription drugs.

  • JOSHUA BOLTEN:

    The president's proposals over the course of his five years now have resulted in a 47.6 percent increase over five years, on spending for veterans' health care, and that includes a substantial increase this past year.

  • KWAME HOLMAN:

    Tennessee Democrat Harold Ford explained how the proposed cuts in education spending would affect school districts in his state.

  • REP. HAROLD FORD:

    We have shortfalls of $36 million in Memphis, $15 million in Nashville, and $8 million in Knox County, or Knoxville. And all this is going to be compounded by vocational education cuts and the elimination of the trio program, which has helped thousands of kids across Tennessee, and for that matter the nation.

    I know the president eloquently said in a meeting with all the cabinet secretaries– and I believe you were there, Director Bolten– that the American people want us to spend money on programs that work, and I agree. Yet there seems to be a disconnect, because you all are cutting programs that are working.

  • KWAME HOLMAN:

    Finally, North Carolina Republican Patrick McHenry spoke up in defense of the president's budget.

  • REP. PATRICK McHENRY R-NC:

    I first want to applaud you and the president for offering a bold budget this year that looks at eliminating 150 duplication of services, as well as ineffectiveness in the budget. It is a bold statement you are looking at mandatory spending and $100 billion worth of savings over ten years there.

  • KWAME HOLMAN:

    Meanwhile, Treasury Secretary John Snow was before the House Ways and Means Committee. Members of both parties noted the president's budget does not include the cost of his plan to create personal retirement accounts under the Social Security system. Michigan Democrat Sander Levin asked why the plan's cost was left out.

  • REP. SANDER LEVIN:

    In the budget itself, in the numbers, is there a number that says "Social Security transition costs: $754 billion"?

  • JOHN SNOW:

    Whether it's in the budget, congressman, I don't know. It is a number we acknowledge as the number going forward for the ten-year period. We acknowledge it. Whether it's formally in the budget or not, I don't know, but we have been transparent.

  • KWAME HOLMAN:

    That suggested to top committee Democrat Charles Rangel that the president's controversial proposal is dead.

  • REP CHARLES RANGEL:

    If you were serious about it, certainly it would be included in the budget and so I'll tell them to put it in the press release there is no money in there for the budget.

  • KWAME HOLMAN:

    Late this afternoon, Secretary Snow moved to another budget hearing on the Senate side of the capitol. Tomorrow Budget Director Bolten takes his turn before the House Ways and Means Committee.

  • JIM LEHRER:

    A correction. We misidentified Congresswoman Rosa Deloro of Connecticut. We said it was Congresswoman Nita Lowey – we were wrong — it was Rosa Deloro of Connecticut.

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