Federal budget on hold

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WASHINGTON – Unable to bring together warring moderates and conservatives, House Republican leaders failed Thursday to get enough votes to pass the fiscal 2007 budget resolution and yanked it from the floor until after the Easter recess.

The action raised the possibility that the GOP majority may not be able to approve a budget this year and that the government might have to continue federal spending with current programs basically intact.

Democrats have already pledged to oppose the Republican budget, which would have called for spending $2.8 trillion in 2007.

It largely paralleled President Bush’s budget proposals, although it included some new enforcement mechanisms to keep spending in line.

Failure to get enough votes for the budget was a setback for the Republican leadership, especially newly elected House Majority Leader John Boehner, R-Ohio.

The departure of Majority Leader Tom DeLay, R-Texas, left the GOP without the tough tactician known for an ability to twist arms on close votes.

Moderates refused to go along with the level of budget reductions in the bill. Rep. Mike Castle, R-Del., said moderates held out for an increase of $7.2 billion in spending for labor, education and health programs.

“I think it’s a good thing for Republicans” that the budget did not go through with these cuts, he said, adding that it put a better face on the party going into the November congressional elections.

By contrast, Rep. Mike Pence, R-Ind., a conservative leader, said he and his colleagues supported the budget measure, adding the leadership had held the line on spending and agreed to such reforms as a line-item veto.

Asked if there might not be a budget approved this year, Pence responded, “That’s out of our hands now.”

He added, “We’ve taken a hard-line stand” on the budget. GOP conservatives have aligned themselves with the leadership, he said.

In a statement, Boehner blamed Democrats for the postponement: “We’ve taken big steps toward making a bold statement with a fiscally responsible plan that roots out waste, fraud and abuse in federal programs. … It is unfortunate Democrats would refuse to consider a fiscally responsible approach rejecting the failed policies of more taxes and more spending.”

Boehner said he was hopeful that the House could approve the budget after a two-week recess, although earlier in the week he had indicated that he might not pursue a post-recess vote if the budget did not pass this week.

The budget is a non-binding resolution that nonetheless sets overall spending targets for government programs, and is used as a vehicle for allocating funds.

Failure to pass the measure left proposals to extend tax cuts on dividends and capital gains in limbo. The White House hopes to pass these tax-extension proposals this year, along with a bill to mitigate the effect of the alternative minimum tax, or AMT.

The AMT was originally designed to ensure that wealthy Americans did not escape paying taxes, but it has not been indexed for gains in inflation. Without action, the levy will hit growing numbers of middle-class taxpayers.

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