Republican Lawmakers Divided on Budget Provisions

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Republicans who dominate Congress and the White House may belong to the same party, but that does not mean they all agree, and their differences are on display here in Washington. In a moment we'll hear about a confrontation over torture. We will start with tax cuts, a constant priority of Republican leaders. Yesterday, one Senate Republican forced her leaders to remove several tax cuts from a budget bill. The move mirrored actions by moderate Republicans in the House, though the provisions may not be gone for good. NPR's Andrea Seabrook reports.

ANDREA SEABROOK reporting:

When the Senate Finance Committee finally sat down to work yesterday afternoon on its bill to cut taxes by about $60 billion, Chairman Charles Grassley began by apologizing. The meeting had been canceled and rescheduled three times, a sign to the outside world of the drama playing out behind closed doors. Republicans have only a slight majority in the Senate and in committees as well, and that means in some committees, if Democrats are united against a bill, the dissent of just one Republican can kill it. That's the scenario that kept the chairman from moving forward on this bill, and when the committee finally did meet, all eyes were on that one Republican.

Senator OLYMPIA SNOWE (Republican, Maine): The reality is, this is a very different world than where we were even six months ago when we enacted the budget resolution.

SEABROOK: Senator Olympia Snowe of Maine. She said the budget was already slated to be more than $300 billion in the red this year, and then the hurricanes hit and Congress began doling out tens of billions in relief money. Snowe said the war in Iraq also costs billions every month, and now she said Americans are finding themselves at the beginning of a winter in which home heating oil and natural gas prices are shooting up by 50 percent. Snowe said this confluence of challenges requires new thinking, and so she refused to vote for the Republican tax bill until two specific tax cuts were removed: the cuts that target wealthier people, those who pay capital gains taxes and earn income from stock dividends.

Sen. SNOWE: Mr. Chairman, I happen to believe that it's not a question of whether or not we support tax cuts. It really is a question of what we can afford to do now in this current economic and fiscal climate, that really does require us to set priorities and to make some tough choices.

SEABROOK: Snowe stood her ground, but some of her Republican colleagues were pretty angry about how the bill came out. Take, for instance, Kentucky Senator Jim Bunning.

Senator JIM BUNNING (Republican, Kentucky): I've heard a lot the last few weeks from some of my colleagues talking about how we can't afford tax cuts that this bill was expected to contain. The growth package is not about tax cuts. It's about stopping tax increases, tax increases that will affect every American family.

SEABROOK: But Snowe called that a shell game, and here's why. Republicans passed tax cuts in 2001 and 2003 with automatic expiration dates, or sunsets. That kept the long-term projected cost of the tax cuts down. But every time one of those sunsets approaches, Republicans argue that to vote against extending the tax cuts is to essentially increase taxes, a vote almost no Republican wants to make. But Snowe argued that the capital gains and dividend tax cuts don't actually expire until 2008, so there's plenty of time to extend them if Congress wants to.

So while moderates may count this as a victory, it could be short-lived. The bill was voted out of committee yesterday and goes to the full Senate next; then it goes into what's called conference, when senators sit down with members of the House to work out their two versions. That's when many Republicans, like Arizona Senator Jon Kyl, hope to slap those tax cuts back into the bill.

Senator JON KYL (Republican, Arizona): This isn't the first time, and I'm sure won't be the last time, that I've supported a bill in committee for the sole purpose of getting it to the floor and eventually to conference.

SEABROOK: Interestingly, this is just like what happened in the House last week. Moderate Republicans forced their leaders to strip the provision allowing oil drilling in ANWR, the Arctic National Wildlife Refuge, from the spending part of the same bill, and more conservative Republicans immediately vowed to put it right back in in conference. So while moderates are getting their way now, some see a bait and switch down the line. Andrea Seabrook, NPR News, the Capitol.

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