Budget Passes but Critics Say the Deficit Is in the Details

WASHINGTON — Congress gave final approval to its $3.5 trillion federal budget on Wednesday, opening the door to President Obama’s policy initiatives on health care, energy and education while sidestepping the difficult question of how to pay for them.

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Jim Wilson/The New York Times
Representative Steny H. Hoyer, the majority leader, said “This budget puts America back on the path to fiscal responsibility.”
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The spending plan, which did not receive a single Republican vote in the House or Senate, would result in substantial red ink over the next five years but foresees a $1.2 trillion deficit in 2010 being cut by more than half within five years.

Democratic backers of the budget called it an improvement over the economic approach followed by Republicans in recent years. They said it was more honest than previous budgets and would require Congress to pay for new spending or tax cuts.

“This budget puts America back on the path to fiscal responsibility,” Representative Steny H. Hoyer of Maryland, the majority leader, said.

But Republicans heaped criticism on the fiscal outline, saying it hid the true extent of future deficits, created unfair legislative advantages for Democrats and expanded the size and reach of the federal government.

“I am really so concerned about where this takes our opportunities as a nation,” said Senator Judd Gregg of New Hampshire, senior Republican on the Budget Committee, who said the budget would cause an “explosion of federal debt.”

The budget outcome reflected the deep ideological divide in Congress. The vote in the House was 233 to 193, with 17 Democrats joining 176 Republicans in opposition; the Senate result was 53 to 43, with 4 Democrats, including newly minted Democrat Arlen Specter of Pennsylvania, joining 39 Republicans against the plan.

Despite the unanimous Republican opposition, the budget moved through Congress more easily than in past years and marked a victory for President Obama and Congressional Democrats. At the urging of the White House, the leadership raced the spending plan through on Wednesday.

“This vote on the economic blueprint is an exclamation point at the end of the 100 days,” said Rahm Emanuel, the White House chief of staff.

But the budget leaves for the coming months the heavy work of fashioning details of the new policies that the Obama administration is pursuing. While clearing the way for overhauls in health care, energy and education, the budget requires that they not add to the deficit. The budget also does not spell out how to pay for the legislation.

It gives Democrats significant room for maneuvering as they move ahead with a health care plan, by providing procedural protection against a Senate filibuster for that legislation, which is still in the early stages of drafting, and allowing 11 years to pay for any health care initiative.

President Obama did not get all he wanted. Lawmakers in both parties dismissed a plan to raise $318 billion by limiting income tax deductions for wealthier taxpayers. The budget also does not extend a middle-class tax cut established by the president beyond 2010 unless Congress finds a way to pay for it.

The final document also shaves billions from other tax relief sought by the White House and reduces the administration’s overall spending request for 2010 by about $10 billion.

Congress has also been cool to the administration’s push to raise $600 billion over 10 years by auctioning off permits for the right to produce carbon emissions. And Congress did not provide $250 billion sought by the administration for more financial bailout programs if necessary.

The budget does grant three years of relief from the alternative minimum tax for middle-income taxpayers, who would be increasingly hit by the automatic tax. In recent years, Congress has been forced to spend time and effort coming up with an annual adjustment.

Democrats called the budget responsible and said that current economic conditions, and the need to recover from the policies of the Bush administration, were the main reasons for the deficits.

Senator Kent Conrad of North Dakota, the Democrat who is chairman of the Budget Committee, said the Congressional plan would spend $555 billion less over five years than the administration’s initial proposal. He said domestic spending would increase an average of 2.9 percent a year over the five-year stretch.

“That is not a big-spending budget,” Mr. Conrad said. “That is a tough budget.”

He and other Democrats said the budget would reduce the deficit to less than 3 percent of the gross domestic product, a level deemed acceptable by some economists. But Republicans said the Democrats were severely underestimating future deficits because the budget failed to account for costs of a health care overhaul, popular tax breaks and other spending that would drive the deficit much higher.

“What we see before us is a budget resolution that is nothing short of the most audacious move to a big socialist government in Washington,” said Representative John A. Boehner of Ohio, the House Republican leader.

But Democrats said the budget reflected the themes that Mr. Obama campaigned on and the priorities of most Americans.

“This is a magnificent blueprint for the future,” Speaker Nancy Pelosi said. link...