Military

DATE=3-21-03

TYPE=CORRESPONDENT REPORT

TITLE=CONGRESS BUDGET (L ONITER)

NUMBER=2-301305

BYLINE=DEBORAH TATE

DATELINE=CAPITOL HILL

CONTENT=

VOICED AT:

INTRO: The Senate Wednesday is scheduled to vote on President Bush's two-point-two trillion dollar budget for next year. Amid concerns over the cost of the U-S-led war to disarm Iraq, Senators Tuesday voted to halve Mr. Bush's proposed tax cut package in a blow to his plan to stimulate the U-S economy. Correspondent Deborah Tate reports from Capitol Hill.

TEXT: Just days after rejecting a similar measure, the Senate Tuesday reversed course and voted to cut more than half of Mr. Bush's proposed seven-hundred-26 billion dollar tax cut.

Senators narrowly voted to reduce the 10-year tax cut package, the centerpiece of the President's economic recovery plan, to 350 billion dollars.

Many Democrats and some Republicans argued that Mr. Bush's tax cut plan is too large at a time when the costs of war in Iraq remain uncertain, and when federal deficits are expected to grow to record levels.

Senator John Breaux, a Louisiana Democrat, sponsored the amendment:

/// BREAUX ACTUALITY ///

The uncertainty over the war, the realization that we are operating with a deficit, not a surplus, are all factors that allowed us to pass a reduction in the size of the tax cut. It is simply a reflection of the facts of the world we live in today.

/// END ACT ///

Three Republicans, including Senator George Voinovich of Ohio, broke ranks with their party to back the amendment:

/// VOINIVICH ACTUALITY ///

As this war goes on and people fully comprehend the responsibilities that we are going to have to win this war and then the aftermath of this war, I think we are going to become a lot more serious about our financial situation.

/// END ACT ///

The vote came on the day Mr. Bush formally sent Congress his request for 75 billion dollars to pay the initial costs of the war.

At the White House, spokesman Ari Fleischer played down the Senate action on the tax cut proposal, saying it was just one step in the legislative process.

/// FLEISCHER ACTUALITY ///

We will see what ultimately comes out of the Senate. They have a lot more voting to do.

/// END ACT ///

Last week, the House of Representatives passed Mr. Bush's budget proposal, including the full tax cut package.

The Senate bill will have to be reconciled with the House measure before a final version is sent to President Bush for his signature. (signed)

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