Democrats, GOP Debate Spending Plans

WASHINGTON — Democrats in the House and Senate trumpeted surplus-producing budget plans yesterday as their GOP rivals seized on looming tax increases in the Democratic spending outlines as a potent issue for the presidential campaign.

Democrats are backing twin $3 trillion budgets for 2009 that would produce sizable surpluses in a few years and provide generous increases for many domestic programs, but only by assuming major tax increases when President Bush's tax cuts expire in about three years.

All three major presidential candidates planned to be on hand today in the Senate for votes on taxes, a one-year ban on lawmakers' pet projects, and a vote to pass the measure. The timing of a final vote wasn't set, however. The House does vote today.

House debate began yesterday, as Republicans pressed an alternative plan that preserves Bush's income tax rate cuts and tax breaks for married couples, people with children, on investments and for those inheriting multimillion-dollar estates. But the price for such generosity is harsh: unrealistic cuts in Medicare, housing, community development, and the Medicaid health care program for the poor and disabled.

The rival budget plans display the difficult trade-offs facing the next president, who must weigh tax cuts that expire at the end of 2010 against popular spending programs like education, highway construction and Medicare. Simply put, it's impossible, under current estimates, to have it all and still be able to produce a balanced budget in a few years. The White House forecasts the deficit for the current year at $410 billion, a near-record.

Republicans blasted the measures for assuming the 2001 and 2003 cuts in taxes on income, investments, parents with children, and married couples will expire at the end of 2010.

"The child tax credit gets cut in half," Rep. Paul Ryan of Wisconsin, the top Republican on the House Budget Committee, said. "The marriage penalty comes back. ... It requires that income tax rates are raised across the board." Democrats countered that their plan puts the budget back in surplus while also making investments in infrastructure, education, community development, clean energy, and other programs. [Also yesterday, the Treasury Department said the federal deficit swelled to $263.3 billion in the first five months of this budget year as record spending during the period outpaced record revenues, the Associated Press reported.]