House narrowly approves budget over Republican protests

The House Thursday voted 214-210 to approve the fiscal 2009 budget resolution, including $1.013 trillion in discretionary spending to be doled out among the 12 annual appropriations bills.

House action on the bill came after the Senate approved the compromise measure 48-45 Wednesday. Enactment of the budget -- a nonbinding blueprint that sets parameters for the fiscal year's tax and spending bills -- would be the first time Congress has approved a spending plan in an election year since 2000.

Approval of the budget is also significant because it is seen as a test of the majority party's ability to govern.

"In any year creating a budget is a difficult challenge," House Speaker Nancy Pelosi, D-Calif., said during debate. "In an election year it is even more challenging because of all the competing priorities that want to be in the budget. But this year we have a budget that is in balance in terms of our values, is in balance in terms of the track that it puts us on."

The budget projects a $340 billion deficit in fiscal 2009, which would shrink until fiscal 2012, when it would achieve a surplus of $22 billion, followed by a surplus of $10 billion in fiscal 2013.

House Budget Chairman John Spratt, D-S.C., characterized the measure as charting a "new course." The proposal also includes a plan to provide $340 billion in tax cuts, including permanent extension of the 10 percent income tax bracket, an increased child tax credit, elimination of the marriage penalty and fixing the estate tax at 2009 levels. The plan assumes enactment of a one-year patch for the alternative minimum tax, which would shield more than 20 million additional taxpayers this tax year because it is not indexed for inflation. Under an agreement with the Blue Dog Coalition, House and Senate budget writers agreed to include a point of order for the budget in the Senate against any provisions that would increase the deficit by as much as $10 billion.

But Republicans were incredulous that the budget would reach a surplus and claimed that it would amount to a record tax increase because it assumes expiration of some of the tax cuts enacted in 2001 and 2003. They also described the budget as a lost opportunity because it would not reduce entitlement spending. House Chief Deputy Minority Whip Eric Cantor of Virginia sought to use the budget to paint likely Democratic presidential nominee Sen. Barack Obama of Illinois as a big-government liberal. Obama's policy "is oblivious to the real [economic] burdens that American families are undergoing right now," Cantor said at a news conference.

Meanwhile, Senate Majority Leader Harry Reid, D-Nev., said that Sen. Joseph Lieberman, I-Conn., was a key vote in the Senate's passage of the fiscal 2009 resolution Wednesday. "Without Lieberman's vote, the budget would not have passed," Reid said. Questions have arisen about Lieberman's role in the caucus since he endorsed presumptive Republican presidential nominee Sen. John McCain of Arizona. Reid declined to discuss details of a Wednesday conversation with Lieberman following his criticism of Obama other than to say that the talks were fruitful.