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House drops request to cut Medicare

Budget bill targets agencies' spending

WASHINGTON -- Bowing to election-year realities, House budget writers dropped President Bush's proposed cuts to hospitals and other Medicare providers yesterday, but preserved his plan to trim spending by most Cabinet agencies.

Representative Jim Nussle, Republican of Iowa and chairman of the Budget Committee, fashioned a $2.8 trillion plan for the budget year beginning Oct. 1 that omits Bush's cuts in Medicare, Medicaid, crop subsidies, and other politically sensitive programs.

The House GOP plan for the 2007 budget year adopts Bush's $873 billion cap on agency budgets renewed by Congress each year. It also assumes $50 billion for the wars in Afghanistan and Iraq, less than one-half of the expected spending for the current year.

In a debate that headed toward the evening hours, Republicans rebuffed attempts by Democrats to increase funding for port security and education and health programs as they approached party-line approval of the GOP measure.

Representative Jeb Bradley, Republican of New Hampshire, however, won unanimous approval of a proposal for $795 million in additional funding for veterans' benefits to make up for money lost because of lawmakers' opposition to unpopular fees proposed by Bush.

The underlying plan endorses Bush's call for a 7 percent increase in the core defense budget -- which doesn't include Iraq war costs -- for next year.

The GOP plan also assumes $226 billion in additional tax cuts over five years, more than half of which would go toward extending Bush's 2001 and 2003 tax cuts, most of which are set to expire in 2010. But it doesn't provide for considering a tax cut bill under fast-track budget rules.

Democrats blasted the Republican blueprint, which would produce a deficit of $348 billion in 2007 and deficits totaling more than $1 trillion through 2011 if Congress approves its policies.

And they doubted the blueprint would even meet these deficit goals, because it doesn't account for the costs of the war in Iraq after 2007 or for shielding middle- to upper-income taxpayers from being hit by the alternative minimum tax.

Representative John M. Spratt Jr., Democrat of South Carolina, said the national debt would almost double to more than $9 trillion under Bush's tenure in office, a natural result ''from a fiscal policy that says you can have guns, butter, tax cuts, too, and never mind the deficit. . . . It holds no real plan or prospect of balancing the budget."

The House GOP plan would drop $65 billion in benefit cuts over five years proposed by Bush's February budget -- such as curbs to Medicare, Medicaid, and crop subsidies -- it goes further than Bush in attacking appropriated spending, the approximately one-third of the budget passed by Congress each year.

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