THOUGH divided, Senate moderates see tax bill, spending clout

<br>WASHINGTON (AP) _ Moderate senators of both parties are setting their sights on influencing upcoming tax-cutting and spending bills, despite the wedge Republican leaders drove among them during last

Saturday, May 12th 2001, 12:00 am

By: News On 6

WASHINGTON (AP) _ Moderate senators of both parties are setting their sights on influencing upcoming tax-cutting and spending bills, despite the wedge Republican leaders drove among them during last week's budget fight.

Five centrist Democrats broke ranks with a dozen other moderates of both parties and provided the decisive votes Thursday for a final 2002 budget that would allow most of the deep tax cuts that President Bush cherishes.

But rather than demonstrating that their coalition is fragile and vulnerable to sudden defections, moderates say, the budget battle underlined their ability to force the White House and GOP leaders to accept changes in legislation.

By the time Congress approved the budget, Bush's $1.6 trillion, 10-year tax cut had dwindled to $1.35 trillion over 11 years _ thanks to the power the moderates wield in a Senate divided 50-50 between the two parties.

``We stood together in terms of whittling the tax bill down,'' Sen. John Breaux, D-La., a leader of the centrists, told reporters after the vote. ``I think we made a big difference.''

The moderates say they are not through. They intend to use their clout as Republicans next try rushing tax-cutting legislation to Bush by Memorial Day in hopes of refocusing it more on lower-income people. After that, they will concentrate on spending bills for the coming year, particularly boosting Bush's proposals for schools.

Even before the Senate Finance Committee considers its tax bill this week, moderates have had an effect.

Chairman Charles Grassley, R-Iowa, and the panel's top Democrat, Max Baucus of Montana, released a proposal Friday that will be the committee's starting point. In a bow to the moderates' strength _ a half-dozen on the evenly split, 10-10 committee _ it altered several of Bush's proposals to shift tax-cut benefits from wealthier to lower-earning Americans.

This included reducing the current top income tax rate of 39.6 percent to 36 percent instead of the 33 percent Bush wants, and letting many poor Americans who owe no income tax get refunds under the tax credit for children.

Senate Majority Whip Don Nickles, R-Okla., said last week that he has little desire to permit changes in the bill sought by moderates who voted against the budget, calling them ``people who opposed us every step of the way.''

But Sen. James Jeffords of Vermont, a Finance Committee member and one of two Republicans who voted against the budget, said GOP leaders would need moderate support.

``They can't pass it without us,'' he said.

Though the precise number varies by issue, both parties have more than a dozen moderate senators. Party leaders have a mixed reaction to them: Happy to have them aboard, while wishing they would cooperate more in the legislative clashes in which Democrats and Republicans try defining their differences.

``I respect the judgment of every senator,'' Senate Minority Leader Tom Daschle, D-S.D., said. ``We'll move on to the next battle. That's all we can do.''

Yet it is hard for the moderates to act as a cohesive voting bloc. Not only are they usually loyal to their own parties, but each has his own agenda influenced by the particular issue, his state's political balance, and re-election deadlines.

Take, for example, Jeffords and Sen. Lincoln Chafee of Rhode Island, the only Republicans to vote against the budget on Thursday. Both largely based their opposition on what they said was the measure's inadequate education funds.

Yet both also knew they had little to fear by opposing a budget featuring Bush's tax cut, because both states voted heavily for Democrat Al Gore in the presidential election. Rhode Island, in fact, was where Gore enjoyed his most lopsided margin, winning by 61-32 percent.

On the Democratic side, all five senators who supported the budget come from states that decisively supported Bush in the election: Breaux, Ben Nelson of Nebraska, Max Baucus of Montana, and Max Cleland and Zell Miller of Georgia.

Cleland and Baucus both face re-election next year. Even so, Baucus' vote was particularly troubling to some fellow Democrats _ though they would not say so publicly _ because he is their top member on the Finance Committee and is expected to be loyal to party leaders.

On the other hand, Democratic Sens. Robert Torricelli of New Jersey, Tim Johnson of South Dakota and Mary Landrieu of Louisiana opposed the measure despite facing re-election next year. Their ``no'' votes had Republicans gleeful at the prospects of using that against them in November 2002, but Democrats disagreed.

``There are those who want to use this as a partisan club, but I don't think that will be very effective,'' said Johnson, whose state Bush carried. ``South Dakota people see a need for a balance between tax relief and improving our schools.''