Congress debates war funding bill, tax cuts

Posted 12:00 p.m. April 10

by Alex Kingsbury
U-WIRE Washington Bureau

President Bush’s domestic economic strategy was dealt a major blow last week when the Senate cut his proposed tax cut proposal by more than half. At issue during the debate was the Iraqi war whose duration and cost can only be estimated.

The president’s $726 billion, 10-year tax cut proposal was cut to $350 billion by Democrats and moderate Republicans in the Senate after the House of Representatives approved the full tax cut last month. The Senate argued that the nation could not afford such steep tax cuts with the nation’s deficit for the year nearing $400 billion and the wild card of the Iraqi war.

The 51-to-48 Senate vote came on day six of the war only hours after Bush requested $74.7 billion in emergency funds to help pay for war costs, homeland security, and foreign aid over the next six months.

“Every dollar we spend must serve the interest of our nation,” Bush said.

The effort to get the initial war allocation of $74.7 billion has been frustrated by legislative additions. By the time each Congressional chamber added its own projects, the House total had risen to $77.9 billion and the Senate’s to $78.7 billion. Both houses approved their measures which included additional spending to aid airlines.

About $60 billion from both bills is budgeted for covering the actual cost of the war, half of which has already been allocated for paying transportation costs to and from the gulf for the nation’s military forces.

Despite the differences between the House and Senate bills, the White House has asked that the war-funding bill be resolved by the spring recess on April 11.

The Bush administration conceded that should the war continue beyond the 30 days included in the budget estimation, additional funds would be needed.

Wrangling over the costs of the war continued in the House as conservative Republicans attempted to cut promised aid to Turkey, a move seen as punishment for the country’s refusal to allow U.S. ground troops to be based there.

The House amendment to cut the aid to Turkey was defeated Thursday on a vote of 110 to 315.

With the war in Iraq exceeding the expectations of even critics, attention is now focusing on the national economy, an issue that hurt the first President Bush after the Gulf War.

President Bush had a meeting with Wall Street economists last week to discuss his proposed economic stimulus packages and tax cuts now before Congress. The nation’s economy continues to struggle amidst nearly a year of uncertainty about the war in Iraq. Consumer confidence is down while unemployment increased slightly in the past few months.

Economists have debated fiercely over the wisdom of accelerating the Bush tax cuts, with the continuing war on terrorism, the war with Iraq and the flagging national economy.

“People are already beginning to recognize that these reckless proposals endanger Social Security and Medicare, while also raising the specter of a panicky hyper-inflation down the road if the government starts printing money to avoid outright default,” said Daniel N. Shaviro, a New York University law professor, in a column for Newsday. “But our military security is also endangered if we find ourselves financially too stretched to consider taking on costly international commitments.”

Others see the president’s tax cut strategy as the impetus that the flagging economy needs to kick start it back to prosperity. Some see a middle ground in the President’s economic strategy

“While waiting for the elusive recovery to arrive, the government has given a sickly economy powerful medicine in the form of low interest rates and high war spending,” USA Today wrote in an editorial last month. “Increasing the dosage would be wasteful.”

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