August 9, 1999
Web posted at: 2:45 p.m. EDT (1845 GMT)

WASHINGTON (CNN) -- Congressional Republicans plan to avoid a repeat of the 1995 government shutdown in the battle over their $792 billion tax cut plan while President Bill Clinton continues to label the plan as irresponsible.

The Republicans are saying they will fund the government at its current levels for as much as a year until a budget agreement with the White House can be reached. That would prevent the sort of government shutdown that hurt the party's standings with voters in 1995, but it also opens the door to a different criticism -- that the party cannot work in the normal budget and appropriations process.

The president on Monday again criticized the tax cut, but focused on House lawmakers for trying to kill one of his administration's pet projects, the AmeriCorps volunteer service program. Clinton used a speech to some Americorps graduates to criticize the GOP proposal.

"The reason that you have people up there trying to zero AmeriCorps is they know they can't pay for their tax cut without big cuts," Clinton said.

Last month, the House Appropriations Committee voted to cut all funds for the program in the fiscal year that begins October 1. Clinton said Republican lawmakers are being shortsighted in seeking to curtail the program that has helped build homes and teach students to read.

"If they zero out the funding, their bill has zero chance of becoming law, because I will veto it," he said.

Over the weekend, Clinton again criticized the GOP tax cut as irresponsible but also said he was optimistic that a compromise could be found.

"I am not nearly as pessimistic as a lot of people are about the prospects of our reaching an agreement, and I am determined to try to do it," he said in a speech Sunday to the nation's governors in St. Louis.

The standoff over the budget and tax cuts is a political issue as much as a policy one because both parties are hunting for support from voters next year, when the presidency and control of Congress are up for grabs in the November elections.

The last time the government was shut down during a budget standoff was in 1995. Clinton received a boost in public support and went on to win re-election in 1996 and the GOP wants to a avoid a repeat should a compromise not be reached by October 1, the start of the new fiscal year.

Congressional Republicans plan to spend their August recess selling the tax cut package to the voters in hopes of forcing Clinton to sign it when they return.

"We believe that public opinion is going to come out strong for this package as it's better understood and we believe the president will respond to that," House Majority Leader Dick Armey (R-Texas) said on "Fox News Sunday."

GOP leaders are clear they would be willing to continue to fund the government at current levels for as long as a year while an agreement can be worked out.

"That's the way to avoid a train wreck," Senate Majority Leader Trent Lott said Sunday on ABC's "This Week," alluding to a possible shutdown. "There's no need for that sort of thing. And it's irresponsible, too."

The Mississippi Republican suggested that stopgap spending legislation, called as a continuing resolution, could keep the government running "for two weeks or a month or for a year."

But Clinton is just as optimistic that he'll be able to make the case that a huge tax cut now would be bad for the economy and for the investments the nation needs to make in its own future prosperity and success.

Rep. Tom DeLay of Texas, the third-ranking Republican in the House, has said a resolution is a "a little trick" that would put Clinton at risk of being blamed for a shutdown if he vetoed it -- as Republicans were during the 1995 shutdowns.

"If (Clinton) vetoes it, then maybe we'll have to wait for a real president that wants to give the American family a tax relief," DeLay said Saturday on CNN's "Evans, Novak, Hunt & Shields."

Republicans, DeLay has said, planned to spend next year's $14 billion annual surplus all along, to force Clinton to pay for his spending programs from the Social Security surplus, which both parties have promised to protect.

DeLay has made no secret he would relish such a scenario, saying post-veto budget negotiations would occur with Clinton "on his knees."

Other GOP leaders were less strident.

Asked whether he shared that vision of a politically weakened president during budget talks, Armey said: "No, of course not. We are all going to be sitting at the table together."

On Sunday, Clinton told the nation's governors that the Republican bill would lead to huge reductions in spending on Medicare, farm programs and other items critical to the states.

The GOP tax cut is based on projected budget surpluses that so far exist only on paper, Clinton said. "So one of two things will happen," he said. "We would either have huge cuts in all these things -- huge -- or we would have a reversion to past policies. We'd go back to deficit spending."

But Republicans contend that Clinton and fellow Democrats would say anything to avoid shrinking the size of government and reducing spending. "The president wants more money so he can spend more money," Sen. Don Nickles (R-Oklahoma) told the governors just before Clinton spoke.

There are some who aren't on either side of the issue. Sen. George Voinovich (R-Ohio) was one of four Republicans who voted against the $792 billion tax cut.

The projected surplus "in my opinion, is a mirage," he said on CNN's Late Edition. He said whatever surplus does emerge should be used to reduce the $5.6 trillion national debt, he said, a debt that costs the country $600 million per day. Of every federal dollar spent, he said, 14 cents go to pay the interest on the debt.

Treasury Secretary Lawrence Summers said on ABC's "This Week" that paying down the debt would result in "a kind of tax cut," he said, by leading to lower mortgage costs. Each 1 percent drop in mortgage interest rates results in $250 billion savings to the nation's homeowners, he said.

The Associated Press contributed to this report.

Monday, August 9, 1999

• GOP presidential hopefuls take aim at Iowa
• Starr says Whitewater report to be issued 'well before' Election Day
• Rep. Lazio to announce intentions on Senate race
• Mills turns down White House counsel job
• Republicans plan to avoid another government shutdown
• U.S. Postal Service approves online stamp sales
• Clinton warns against complacency from Kosovo victory
• Senator says U.S. will make an example of suspected terrorist
• Clinton criticizes attempts to eliminate program funding
• Yellow pages typo directs White House surfers to porn site
• Clinton prods Senate to pass nuclear test ban treaty
• In California, politicians in a frenzy after fund-raising law thrown out
• AIDS activists disrupt Gore speech
• Administration creating new council to combat overseas propaganda

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