Congress resurrects economic stimulus plan

WASHINGTON -- Republicans and Democrats struggled Wednesday to resurrect economic stimulus legislation at the dawn of an election-year session of Congress, their efforts given urgency by evidence of rapidly eroding budget surpluses.

The nonpartisan Congressional Budget Office lowered its projected budget surpluses for the next decade by 71 percent from last year's estimates -- a reduction of $4 trillion. It also said the government will run deficits this year and next, the first since 1997.

"We need some type of a stimulus package," said House Speaker Dennis Hastert. Top Republicans said they welcomed Majority Leader Tom Daschle's proposal for renewing work on a recession relief bill that was blocked in the Democratic-controlled Senate last year.

"This is an honest and earnest effort to move this process along without finger-pointing," said Daschle, the South Dakota Democrat whom Republicans routinely depict as an obstructionist.

Even before the opening gavels fell at noon in the House and Senate, the sour economic news intruded. The Congressional Budget Office's latest forecast put the 10-year surplus at $1.6 trillion, down from $5.6 trillion in last year's prediction.

For the current fiscal year, a deficit of $21 billion was estimated, dropping to $14 billion for the 2003 fiscal year -- heralding an end to a short, happy era of surpluses.

The more pessimistic outlook will complicate any attempts to create large new government programs such as prescription drug benefits for Medicare recipients, and Democrats trumpeted the report as fresh evidence that the tax cuts President Bush won from Congress last year were irresponsible.

Bleak budget

"The president told us and told the American people that we could have it all," said Sen. Kent Conrad, D-N.D, chairman of the Senate Budget Committee. "He was wrong by a country mile."

The committee's top Republican, Sen. Pete Domenici, R-N.M., said the bleaker budget picture was mostly due to the recession as well as efforts to strengthen the economy and battle terrorists.

At the White House, spokesman Ari Fleischer said, "At the end of the day, the government, instead of having a gargantuan surplus will now have a very large surplus."

After a month away, lawmakers returned to a changed Capitol. New security barriers were visible on the grounds outside the building, while across the street, senators settled back into the Hart Office Building, office suites finally declared free of anthrax after three months of uncertainty.

Bush greeted congressional leaders at the White House and was quoted as making a pledge to Democrats not to use the war on terrorism for election-year gain. "I have no ambition whatsoever to use this as a political issue," he said, according to sources who declined to be identified by name. They quoted the president as saying, "There will be no daylight between us."

White House adviser Karl Rove caused a stir among Democrats last week when he told a gathering of Republican Party leaders they would do well to talk up the popular war in this year's midterm elections. Rove was present in the Cabinet Room when Bush made his remark.

Legislative priorities

One by one around the big table in the White House Cabinet Room, Bush and senior congressional leaders listed their legislative priorities for the year ahead: expanded trade authority for the president, a farm bill, a patients' bill of rights, energy legislation -- and an economic stimulus package to help victims of the recession and boost the sluggish economy.

Republicans and the White House have criticized Daschle vigorously in recent weeks for refusing to allow a vote on a House-passed stimulus bill on the final day of the session in 2001, even though it apparently had the support to pass.