Senate approves emergency war funding; larger aid bill stalls in House

By Shailagh Murray and Lori Montgomery
Washington Post Staff Writer
Friday, May 28, 2010

The Senate approved emergency war funding and disaster relief Thursday but a larger bill, packed with jobless aid, business tax breaks and other economic incentives, stalled in the House amid rising deficit concerns.

The Senate bill, approved 67 to 28, carries a total price tag of $58.8 billion and includes $33.5 billion in Pentagon funding to send 30,000 more U.S. troops to Afghanistan. The balance will fund State Department activities, Haitian earthquake relief, and Tennessee flood cleanup. The bill awaits House action after the Memorial Day recess.

As part of the war funding debate, Senate Democrats defeated a series of Republican amendments aimed at tightening security on the Mexican border, including a proposal by Sen. John McCain (R-Ariz.) to dispatch an additional 6,000 security troops.

The McCain measure needed 60 votes to pass but got only 51. It did win support from 12 Democrats, including some up for reelection in November: Sens. Michael Bennet (Colo.), Barbara Boxer (Calif.) and Blanche Lincoln (Ark.).

Late Thursday, House leaders were frantically disassembling the jobless package in hopes of winning over a large bloc of moderate Democrats for a scaled-down version. Talks were focused on removing about $24 billion in emergency aid to state governments, sought by governors in both parties, and paring back an extension of federal assistance to jobless workers who pay COBRA health insurance premiums.

Both of those provisions are likely to be considered after the Memorial Day break, aides said. Meanwhile, House leaders also planned to remove a $23 billion provision that would postpone, until 2012, a 20 percent pay cut for doctors who see Medicare patients. The fee reduction is scheduled to take effect next week.

The Senate adjourned Thursday without passing any portion of the jobless package, amid a growing concern among Democrats that government spending is out of control. Majority Leader Harry M. Reid (D-Nev.) said the Senate would attempt at least to extend unemployment benefits after the recess. The fate of the other provisions is less certain.

The latest House version would include about $40 billion to extend jobless benefits and about $56 billion to extend expiring tax breaks and fund other measures. Only the jobless benefits would add to the nation's budget deficit, aides said; the cost of the rest of the package would be covered by raising taxes on investment fund managers and closing loopholes that Democrats say encourage multinational corporations to send jobs overseas.

The expiring tax breaks include scores of special-interest provisions that expired as of Jan. 1, including perks for the oil, cotton and coal industries, and subsidies for NASCAR tracks and Puerto Rican rum.

Rep. Chris Van Hollen (Md.), a member of House Democratic leadership, said lawmakers debated dropping some of the business tax breaks but decided not to risk the potential harm to companies still recovering from the recession.

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