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Budget plan puts off hard choices

By ASSOCIATED PRESS
Published March 16, 2007

WASHINGTON - The Senate Budget Committee approved a plan Thursday that promises a federal surplus in five years - but only by assuming that President Bush's tax cuts expire at the end of this decade.

Democrats muscled the bill through the committee on a 12-11 vote along party lines that presages an equally partisan debate by the full Senate next week.

Despite much debate over taxes, the immediate impact of the $2.9-trillion budget blueprint for next year is to award an $18-billion increase to domestic programs popular with lawmakers in both parties.

Democrats opted to put off politically painful decisions on shoring up the finances of Medicare and Social Security.

Republicans warned that the plan, authored by Senate Budget Committee Chairman Kent Conrad, D-N.D., would guarantee the demise of Bush's tax cuts, which expire at the end of 2010.

The Democratic plan assumes that Bush's tax cuts on income, married couples, investments and inheritances will expire as scheduled unless lawmakers produce more than $400-billion in tax revenues to comply with the Democrats' so-called pay-as-you-go rule.

"It would be the largest tax increase ever," said Sen. Charles Grassley of Iowa, top Republican on the tax-writing Finance Committee.

"There isn't going to be any tax increase anytime soon," Conrad said. He said his budget is aimed at paving the way for a bigger debate on tax questions - including painfully expensive reforms to the alternative minimum tax - after the presidential election.

[Last modified March 16, 2007, 01:32:31]