Extension of Benefits For Jobless Is at Risk

House Democrats Modify War Funding Bill

House Democrats are likely to drop a 13-week extension of unemployment insurance benefits from a major spending package that includes continued funding for the wars in Iraq and Afghanistan and that would create a new education benefit for military veterans returning from the battlefields.

House Majority Leader Steny H. Hoyer (D-Md.) said yesterday that the unemployment insurance provision would "probably not" be part of the final package of war and domestic spending, which has become the most important legislative battle this spring between congressional Democrats and President Bush.

After huddling in the offices of House Speaker Nancy Pelosi (D-Calif.) for more than two hours yesterday, House Democrats emerged to say they were still undecided about how to pare down the overall cost of the supplemental spending bill.

"I'll do what I do when I do it, but I don't telegraph it ahead of time," said House Appropriations Chairman David R. Obey (D-Wis.), after a meeting of the Democratic leadership of both chambers.

The version of the bill approved by the Senate on May 22 would cost more than $250 billion over 10 years, a price tag that the fiscally conservative caucus of "Blue Dog" House Democrats opposes. The bill would provide $165 billion to fund the two wars into the next presidency, along with billions of dollars more for domestic programs.

The unemployment insurance provision is one of several measures likely to be cut in an effort to win the support of the Blue Dogs and to increase the opposition to a veto that President Bush has threatened over several aspects of the bill.

Aides and lawmakers said there is general agreement on a final version of the bill that would give the Pentagon about $165 billion in war funds and the new education benefit.

But the veterans provision is the most costly domestic add-on to the bill, at about $52 billion over 10 years. Bush and Sen. John McCain (Ariz.), the presumptive GOP presidential nominee, oppose the measure, saying it is too costly and could encourage troops to leave military service at a time when personnel already are stretched thin.

When the House passed its first version of the bill in mid-May, Pelosi gave in to Blue Dogs' demands and funded the new veterans education program with tax increases on the wealthy. But the tax increases did not pass the Senate.

House Democrats now hope that eliminating the unemployment insurance and other spending from the bill will mollify Blue Dog concerns on spending for the new "G.I. Bill."

Senate Democrats have pushed to include unemployment insurance, which they say is the quickest way to pump money into the slowed economy. Asked whether the Senate would approve a bill without extended unemployment benefits, Senate Majority Whip Richard J. Durbin (D-Ill.) said: "I don't know. We're waiting to see what the final package is."

In a vote last month, 75 senators approved the domestic spending portion of the supplemental legislation, including the veterans education plan and the extended unemployment insurance benefits.

Hoyer said the final version of the bill most likely would not come to the House floor until next week, as part of a process in which each chamber continues to pass versions of the bill that it hopes the other will accept.