Sunday, July 31, 2005

Bush draws heat from conservatives on highway bill


Bush draws heat from conservatives on highway bill

By Caren Bohan

WASHINGTON (Reuters) - Despite big legislative wins this week, President Bush is drawing heat from some conservatives over his plans to sign a highway bill that critics say warranted a veto because it is chock full of extra spending.

Bush was pleased by a mid-July report from his budget office that slashed the fiscal 2005 deficit forecast to $333 billion -- down nearly $100 billion from its February projection and lower than last year's $412 billion shortfall.

But Bush, whose first four years in office saw a shift from record surplus to record deficits, has some persuading to do with members of his own Republican Party when he extols a commitment to fiscal discipline.

Many Republican activists are upset over the six-year $286.5 billion highway bill approved by Congress on Friday. Bush's aides made clear he would sign the bill even though he previously pledged to veto any measure above $284 billion.

"This bill is an egregiously bloated spending bill and this all happens as we move to the final phase of the spending season," said Pat Toomey, head of the Club for Growth, a group that raises money for Republican candidates.

By backing down on a pledge to hold the line on highway funds, Toomey said Bush was sending a signal of laxity to Congress as it prepares to finalize spending bills this fall, which often include funds for members' pet projects in their districts.

"How will his future threats be taken seriously?" Toomey asked.


Former House of Representatives Republican Leader Dick Armey said a highway-bill veto would be a chance to show Congress "the spending spree is over."

The legislation, which lays out guaranteed amounts of money for road and transit projects, was overwhelmingly approved in both chambers of Congress. Such bills give lawmakers a chance to show they are funneling funds back to their districts and spurring construction and new jobs.

White House spokesman Scott McClellan has said that Bush felt lawmakers had come a long way in whittling down the bill's cost. A Senate version of the bill in May sought $295 billion.

An administration official, eager to emphasize a push to hold the line on spending, said White House budget director Joshua Bolten spoke this week to House of Representatives lawmakers to oppose Senate plans to shift funds out of the defense budget to pay for non-security programs.

Budget analysts see the Senate move as a gimmick intended to free up more money because the defense funds will be replenished in a supplemental spending bill for Iraq and the war on terror.

William Niskanen, chairman of the Cato Institute think tank, referred to the highway bill as an "abomination" but said Bush likely agreed to it to buy votes for a key priority, the U.S. Central-American Free Trade Agreement.

The CAFTA pact narrowly passed this week. Bush's long-sought revamp of energy policy also passed Congress this week.

Niskanen said it may also have been in Bush's interest to avoid a fight with the Senate on a spending bill as he seeks approval of his nominee to the Supreme Court, John Roberts.

Brian Riedl, budget analyst at the Heritage Foundation think tank, said that while at some point Bush may have to veto a spending bill, letting the highway bill go through won't by itself spell fiscal doom.

"The president has convinced Congress to generally stick within his discretionary spending guidelines," Riedl said.