Congress passes $2.27 trillion budget

$400 Billion for Medicare Prescription Coverage

WASHINGTON, April 11, 2003 -- Congress approved a record $2.27 trillion federal budget, including $400 billion for lawmakers to develop a Medicare prescription drug benefit later this year.

The final version would also eliminate a provision in the House-passed resolution calling for $265 billion in spending reductions over 10 years in benefit programs including Medicaid.

Every Democrat in the House and Senate opposed the budget except one, Sen. Zell Miller of Georgia.

Senate Minority Leader Tom Daschle, (D-S.D.), summed up Democrats' opposition when he said Republicans' "obsession with tax cuts" led to producing a budget that falls short in spending on education, homeland security and Medicare.

As Congress begins pondering how to allocate that $400 billion for Medicare prescription drug coverage, it got a warning from the National Committee to Preserve Social Security and Medicare.

It's crucial to maintain Medicare's "social insurance principle," the National Committee to Preserve Social Security and Medicare said.

Vice President Dick Cheney's vote was needed to break a 50-50 tie in the Senate, where most of the opposition to President Bush's proposed tax cuts was centered. The deal that finally squeaked through restricts new tax cuts over the next decade to $350 billion. It was negotiated by Sen. Charles Grassley (R-Iowa) chairman of the tax-writing Senate Finance Committee.

The White House and House Republicans initially sought $726 billion in tax cuts and had reluctantly accepted a $550 billion limit and were caught off guard by the lower final figure.

House Speaker Dennis Hastert called Grassley's pact "irrelevant" and said he has an agreement with Senate Majority Leader Bill Frist that the tax cuts could reach the larger figure when Congress begins working on them in May.

Grassley, however, also claimed commitments from Frist and Senate Budget Committee Chairman Don Nickles (R-Okla.) in promising moderate Sen. Olympia Snowe, R-Maine, the cuts won't exceed $350 billion.

The budget permits the spending controlled by Congress to grow less than 3 percent next year, to $785 billion. More than half that money -- $400 billion -- will go to defense.