Democrats Ready Omnibus Budget Bill

Friday, December 14th 2007, 7:20 am

By: News On 6

WASHINGTON (AP) _ Congressional negotiators worked to cut hundreds of federal programs, big and small, as they fashioned a $500 billion-plus catchall government funding bill Thursday.

But while agreement with the White House remained elusive, negotiations went ahead on the assumption that Democrats would largely accept President Bush's strict budget for domestic programs and that he would ease up a bit if additional funding for Iraq is approved.

In the meantime, the House passed a bill to keep the federal government open for another week to give negotiators time to fashion the omnibus spending bill, pass it in both the House and Senate and then adjourn for the year.

The House passed the short-term funding bill by a 385-27 vote; Senate approval Thursday evening sent it to Bush. It would fund through Dec. 21 the 14 Cabinet departments whose budgets have yet to pass.

After months of battling, Democrats announced Wednesday they would all but surrender to Bush's demand that lawmakers appropriate no more than $933 billion for annual operating expenses for Cabinet departments, whose budgets are set each year by Congress.

Democrats hoped to make an exception for a $3.7 billion increase for veterans health care, calculating that Bush and his GOP allies on Capitol Hill would relent in the case of that politically sacrosanct program.

Democrats still had differences to resolve among themselves, with Capitol Hill Republicans, as well as the White House.

``I have no agreement at this stage with the people in the House, the Republicans in the Senate, and the White House,'' said Senate Majority Leader Harry Reid, D-Nev.

The White House was quick to say it had not signed on to the Democrats' measure, awaiting details of the bill's final cost, the funding mix within accounts and the resolution of its request for additional Iraq and Afghanistan war funds. Still, hope was building that a deal could be sealed over the weekend or early next week.

``We're hopeful and encouraged by the movement that we're seeing on the Hill right now,'' said White House budget office spokesman Sean Kevelighan.

The White House does not believe the additional veterans money is needed and previously has issued veto threats if the money for veterans is not accompanied by cuts elsewhere in the budget. That approach has been widely seen as unrealistic, even by top Republicans like House Minority Leader John Boehner of Ohio.

But with the White House playing such a strong hand in the negotiations, Boehner now insists Democrats stick within the president's $933 billion figure, with exceptions for border security and a few other ``emergencies.''

Cuts and limits would hit a wide spectrum of programs. The entire Interior Department budget would be frozen at 2007 levels, while the Millennium Challenge Corp., which targets aid to countries implementing economic and politic reforms, would be cut.

But lawmakers eager to bring federal dollars home to their districts would largely see their ``earmarks'' preserved.

The issue of Iraq spending has yet to be resolved, though expectations were growing that Senate Democrats would relent and allow Republicans to provide up to $70 billion in new war funds to the measure, without restrictions that have provoked veto threats from Bush, such as a December 2008 target date for withdrawing combat troops.

The bill will not carry Iraq aid when passing the House next week, though Democrats have said they will attach about $30 billion for U.S. operations in Afghanistan and some domestic Pentagon needs.

Democrats' decision to largely hew to Bush's budget demand follows months of wrangling. Democrats initially crafted bills adding $23 billion above Bush's budget, including increases for health research, education, grants to state and local governments and energy research.

More recently, Democrats worked with pragmatic appropriations panel Republicans such as Sen. Thad Cochran of Mississippi and Rep. James Walsh of New York to craft a split-the-differences bill cutting $11 billion from the earlier Democratic measures. That effort collapsed after the White House issued a veto threat Saturday.

Now, lawmakers led by House Appropriations Committee Chairman David Obey, D-Wis., and his Senate counterpart Robert Byrd, D-W.Va., are squeezing the remaining funding bills by an additional 1.6 percent, said a Byrd spokesman.

The measure would fund every Cabinet department except the Pentagon. Under Bush's budget, domestic Cabinet departments other than Homeland Security and Veterans Affairs would see their budgets frozen. Considering inflation and population gains, that means most programs wouldn't be able to deliver a comparable level of services next year as they do now.

Still, Democrats are taking steps to ease the pain. They have shifted at least $5 billion from defense and foreign aid accounts to domestic programs. And they've added $2 billion in future-year appropriations for education that, for practical purposes, adds to Bush's budget for next year.

In addition to the veterans' funding above Bush's request, the omnibus spending package being assembled adds $7.4 billion for various emergencies, including border security, foreign aid and State Department operations in Iraq and Afghanistan, drought relief, heating subsidies for the poor and covering a shortfall in a food program for women and children.