Iraq War Trigger Would Freeze Spending, Tax Cuts

Posted March 11, 2003 at 6:26pm

Senate Democrats hope to defray the cost of a war with Iraq by inserting a mechanism into the budget resolution that would either freeze tax cuts, spending or both.

The effort, which Democrats acknowledge is a long shot, is intended to highlight the fact that Senate Republicans and the White House have not factored into their budget blueprint the impact the possible war will have on the deficit, especially when President Bush’s proposed tax cuts and spending plan would increase deficits by as much as $1.8 trillion over the next decade even without a war.

“I think it might be a good occasion for that kind of triggering mechanism,” said Sen. Russ Feingold (D-Wis.), a member of the Budget Committee. “I think the issue works to our advantage, their mistake of pushing this tax cut when we’re already going to have the largest deficit in the country’s history and then to have this war that’s obviously going to cost a great deal.”

The trigger mechanism is just one of a host of strategic amendments Democrats said they will pursue during the budget debate in both the committee this week and on the floor next week as a way of using the costs of a war with Iraq as a political weapon to undercut Bush’s new $726 billion tax cut. [IMGCAP(1)]

Senate Minority Leader Thomas Daschle (D-S.D.) announced Tuesday that Budget ranking member Kent Conrad (D-N.D.) would offer an amendment similar to the trigger mechanism in the Wednesday markup of the budget resolution. Conrad’s amendment will seek to prevent Congress from passing any new tax cuts or additional spending until the White House reveals costs of a potential war.

“Until we know the costs of the war and its aftermath, there ought to be no tax cuts, no additional spending,” said Daschle. “With regard to costs, I think it’s irresponsible and extremely unwarranted for the administration to withhold key information from us as we make critical decisions about the budget.”

With their various amendments, Democrats hope to siphon off votes on the budget resolution from moderate Republicans and Democrats who have already expressed worry about the future fiscal outlook for the country in the aftermath of war.

Though their proposals will be vigorously opposed by the Senate GOP leadership, some Republicans are already making noises that could make them potential Democratic allies when the trigger proposal and other amendments to redirect funds to homeland security and education come to the floor.

GOP moderate Sen. Olympia Snowe (Maine) said the bipartisan group of moderates she has been working with to devise a cheaper alternative to Bush’s tax plan had “talked peripherally” about the trigger proposal, but no decision has been made on whether to support the Democratic leadership’s plans.

The potential cost of the war in general, however, is greatly affecting the tax proposal Snowe and others will back, she said.

“The war in Iraq, the war on terrorism, homeland security measures, all combined, it creates some very difficult circumstances that demand additional funding,” she said of her plan to scale back the tax cut to pay for other priorities.

Snowe, along with Sens. George Voinovich (R-Ohio) and Lincoln Chafee (R-R.I.), has been pleading with her more conservative Republican colleagues to factor in the costs of war before moving forward with the budget but to no avail, said Sen. John McCain (R-Ariz.).

“It just doesn’t seem to be impacting a lot of Republican Senators, but I think it’s extraordinarily serious,” said McCain. “It’s interesting to me that we’re going forward with the [budget] process when we don’t know the cost of war.”

Moderate Sen. Ben Nelson (D-Neb.) said he has been proposing a slightly different trigger, or “circuit breaker,” that would not automatically freeze spending or tax cuts, but force Congress to reconsider its budget, tax and spending decisions if deficits are mushrooming.

“I’ve said to a couple of my colleagues who are [Republican] committee chairs that I would be more interested in talking about tax cuts and the size of a tax cut in the aftermath of a war with Iraq,” said Nelson. “Don’t finalize decisions about [the budget and tax cuts] until you know what economy you’re dealing with. … The worst mistake is to fix the wrong economy.”