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House Approves FY2002 Budget; Senate Set to Debated Resolution Next Week

Highly partisan debate led to the House’s approval of the FY2002 budget resolution (H. Con. Res. 83) on March 28. After defeating four alternatives, the House voted, 222-205 to approve the FY2002 budget. The resolution was approved by the committee on March 21 (see The Source, 3/23/01, p. 1).

The Senate will consider its version of the budget next week. With the Senate Budget Committee split 50-50, Committee Chair Pete Domenici (R-NM) decided to bypass committee consideration and bring the resolution straight to the Senate floor. Details of Sen. Domenici’s budget proposal will not be released until April 2, prompting Senate Democrats to threaten to delay action on the proposal.

As approved by the House Budget Committee, the FY2002 budget resolution would provide $335.7 billion in non-defense discretionary spending, representing a 3.5 percent increase over FY2001. The resolution also would cap FY2002 emergency spending at $5.6 billion.

Overall, the FY2002 budget resolution would provide for a $1.62 trillion tax cut over ten years. These tax cuts would be implemented through four separate reconciliation packages: a marginal rate reduction, doubling of the child tax credit, marriage tax penalty relief, and elimination of the estate tax.

Noting the partisan nature of the debate, Rep. Nancy Johnson stated, “I regret that my colleagues on the other side of the aisle are playing such purposeful politics with this budget debate….First of all, there is more money in this budget for prescription drugs than there ever was in a Clinton budget….There is authority in the bill for us to write the prescription drug bill that we think will serve seniors and their children and grandchildren in the future.”

Rep. Sue Myrick (R-NC) agreed, pointing to the importance of tax relief: “This budget provides immediate retroactive income tax relief for all taxpayers to the tune of $93 billion. That is immediate tax relief.”

However, Rep. Carolyn C. Kilpatrick (D-MI) disagreed, saying, “This budget gives no taxes, no relief, for over one-third of the families in this country with children.”

Additionally, Rep. Nancy Pelosi (D-CA) stated, “When the House chooses to use trillions of dollars for a tax cut, it gives us a tremendous opportunity cost to American families. We lose the benefit of improving child care and education for our children. We lose the opportunity for real prescription drug benefits for our seniors.”

During debate, the House defeated, 79-343, a budget alternative offered by Rep. Dennis Kucinich (D-OH) on behalf of the Progressive Caucus, a group of liberal Democrats. Overall, the budget alternative would have provided larger increases for non-defense discretionary spending, while reducing defense spending by 20 percent. The budget proposal assumed a $5.5 billion increase for Head Start, a $5 billion increase for Pell Grants, a $23 billion increase over five years for school renovations, a $1.2 billion increase for the Child Care Development Block Grant, a $2 billion increase for affordable housing construction, a $2.7 billion increase for the National Institutes of Health, a $150 million increase for community-based health centers, and $500 billion over ten years for a Medicare prescription drug benefit.

Additionally, the Progressive Caucus budget would have provided $300 yearly to every American as long as the budget surplus continues at an estimated cost of $900 billion over ten years.

The House also defeated, 204-221, another budget alternative offered by Rep. Charles Stenholm (D-TX) on behalf of the Blue Dog Coalition, a group of conservative Democrats. The Blue Dog alternative would have established a five-year budget plan, rather than the proposed ten-year plan. Additionally, the plan would have used all of the projected Social Security and Medicare surpluses for debt reduction. On-budget surpluses would have been split between debt reduction (50 percent), tax cuts (25 percent), and increased spending for certain programs (25 percent), including a Medicare prescription drug benefit and education.

Rep. Floyd Flake (R-AZ) offered the Republican Study Committee’s (RSC) budget alternative, which was defeated, 81-341. The RSC alternative, authored by a group of conservative Republicans previously known as the Conservative Action Team, would have provided for $2.2 trillion in tax cuts over ten years. Non-defense discretionary spending would have been reduced by $27 billion in FY2002 and $3.7 trillion over ten years. Additionally, the RSC alternative would have required that any prescription drug benefit be considered as part of a Medicare reform bill.

The Democratic substitute, offered by Rep. John Spratt (D-SC), was defeated, 183-243. The Democratic substitute would have provided for $737 billion in tax cuts over ten years, while increasing discretionary spending by $21.3 billion in FY2002. Under the Democratic alternative, education programs would have received a $4.8 billion increase.

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