Clinton holds budget aces

The President may turn the tables on his foes as the day of reckoning looms, writes Rupert Cornwell

Washington - President Bill Clinton yesterday vowed he would veto Congressional tax and health-care reform plans, presenting himself as the last line of defence against an extremist Republican party. It is a strategy which has already given him the initiative in the looming showdown with Congress over the federal budget, and could become a winning formula for his 1996 re-election campaign.

Technically, the moment of budgetary reckoning is still three weeks off. But after a brief flirtation with compromise, the Democratic White House and the Republican majority on Capitol Hill are back on collision course, playing a game of financial chicken which, if neither side yields, could shut down the government and even lead the US into a debt default.

The battle is unfolding on two fronts: the clutch of spending bills for the year 1995-96 which began on 1 October, and a mammoth overall "reconciliation" bill laying out the detailed tax and spending cuts to meet the Republicans' goal of balancing the budget by 2002. All must be on Mr Clinton's desk by 13 November, when the current stop-gap bill authorising government spending expires.

But internal Republican disputes, the leisurely procedures of the Senate and the sheer number of bills to be passed make it unlikely that deadline any longer can be met. Increasingly the Republicans are bogged down in legislative detail, and yesterday Mr Clinton said only three of the 13 spending bills had been finished.

But the real budget wars are over taxes and Medicare, the federal health- care scheme for the elderly, which the Republicans want to cut back by $270bn (pounds 168bn) over the next seven years. The plan was expected to be approved by the House last night, but its fate in the Senate is unclear. The same goes for the $245bn (pounds 150bn) tax-cut package, which Mr Clinton says conceals a $43bn (pounds 27bn) tax increase for poorer Americans.

A year ago Mr Clinton met crushing defeat over his health care reform plan, as Republicans scared voters into believing a bureaucratic government takeover of the country's health system was at hand. This time, roles are exactly reversed.

By taking the axe to Medicare and Medicaid, the separate government scheme for the poor, it is the Republicans who are the reformers - accused by Mr Clinton of mounting a callous and ideologically driven attack on the US social-safety net, all in the name of unneeded tax cuts for the rich. "There's a right way to balance the budget and a wrong way. This is the wrong one," Mr Clinton declared.

And scaremongering is working again. Any honeymoon of ordinary voters with the Republicans after the party's historic sweep of Congress last year is long over, with 55 per cent of respondents in a recent survey saying that the more they heard what Congress was up to, the less they liked it. Asked to choose between tax cuts and "saving Medicare", voters by far prefer the latter.

By contrast Mr Clinton, preacher of change in 1992 but now champion of the status quo, is enjoying his highest approval ratings in months, and in a presidential match-up easily beats the Senate majority leader, Bob Dole, the current leading Republican candidate.

So far the Republican leadership betrays few signs of nervousness. Dismissing Mr Clinton's protestations as "a joke", and insisting that no President would dare veto a balanced budget, Speaker Newt Gingrich says he will deliver the bills at the appointed hour.

Mr Gingrich also seems determined to make congressional approval needed for an increase in the US government's $4,900bn (pounds 3,060bn) debt ceiling conditional on Mr Clinton's acceptance of the reconciliation bill in its entirety. This week the Treasury announced it was scaling back some future borrowings, but the ceiling will still be hit in mid-November. At that point, if impasse continues, the US will default on some bond redemptions, possibly throwing financial markets into turmoil.

But as endgame approaches, Mr Clinton holds the better cards. For one thing Republicans are divided, not least Messrs Gingrich and Dole themselves. Faced with a Clinton veto, the instinct of Republican moderates like Mr Dole would be to cut a deal.

Mr Gingrich, though, is increasingly prisoner of the radical young Republicans who entered Congress last year. He is also learning the lesson of any would-be budget balancer. As the Republican landslide last year showed, everyone wants to get rid of the deficit. As the waning popularity of the Republican Congress now proves, no one wants to pay for it.

News
The surrealist comedian at the Q Awards in 2010
people
Life and Style
Six of the 76 Goats' cheese samples contained a significant amount of sheep's cheese
food + drink
News
Russell Brand arriving for the book launch in East London
peopleRussell Brand cancels his book launch debate due to concerns about the make-up of the panel
Arts and Entertainment
Contestants during this summer's Celebrity Big Brother grand finale
tvBroadcaster attempts to change its image following sale to US
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Julianne Moore and Ellen Page are starring together in civil rights drama Freeheld
film
Arts and Entertainment
Sarah Dales attempts to sell British Breeze in the luxury scent task
tvReview: 'Apprentice' candidates on the verge of tears as they were ejected from the boardroom
Voices
New look: Zellweger at Elle's Women in Hollywood awards on Monday
voicesRenée Zellweger's real crime has been to age in an industry that prizes women's youth over humanity, says Amanda Hess
Arts and Entertainment
film

Marvel has released the first teaser trailer a week early after it leaked online

Extras
indybest
Life and Style
CHARGE BOOSTER: Aeroplane mode doesn't sound very exciting, but it can be a (phone) hacker's friend. Turning on the option while charging your mobile will increase the speed at which your phone battery charges
techNew book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone
Sport
Christiano Ronaldo enjoys his opening goal
champions leagueLiverpool 0 Real Madrid 3: Ronaldo and Benzema run Reds ragged to avenge thrashing from their last visit to Anfield
Arts and Entertainment
Awesome foursome: Sam Smith shows off his awards
music22-year-old confirms he is 2014’s breakout British music success
Arts and Entertainment
Sir Nicholas Serota has been a feature in the Power 100 top ten since its 2002 launch
art
News
Call me Superman: one of many unusual names chosen by Chinese students
newsChinese state TV offers advice for citizens picking a Western moniker
News
Wilko Johnson is currently on his farewell tour
people
News
Let’s pretend: KidZania in Tokyo
educationKidZania lets children try their hands at being a firefighter, doctor or factory worker for the day
News
i100
Voices
'Irritatingly Disneyfied': fashion vlogger Zoella
voicesVicky Chandler: Zoella shows us that feminism can come in all forms
Life and Style
health
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

General Cover Teacher

£120 - £125 per day: Randstad Education Luton: The Job:TEACHERS REQUIREDWe are...

Year 6 Teacher

£100 - £120 per day: Randstad Education Hull: Randstad Education are currently...

SEN Teaching Assistant

£60 - £70 per day: Randstad Education Leeds: Special Needs Teaching Assistant ...

Year 4 Teacher

Negotiable: Randstad Education Hull: Randstad Education is urgently recruiting...

Day In a Page

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker
Renée Zellweger's real crime has been to age in an industry that prizes women's youth over humanity

'Renée Zellweger's real crime was to age'

The actress's altered appearance raised eyebrows at Elle's Women in Hollywood awards on Monday
From Cinderella to The Jungle Book, Disney plans live-action remakes of animated classics

Disney plans live-action remakes of animated classics

From Cinderella to The Jungle Book, Patrick Grafton-Green wonders if they can ever recapture the old magic
Thousands of teenagers to visit battlefields of the First World War in new Government scheme

Pupils to visit First World War battlefields

A new Government scheme aims to bring the the horrors of the conflict to life over the next five years
The 10 best smartphone accessories

Make the most of your mobile: 10 best smartphone accessories

Try these add-ons for everything from secret charging to making sure you never lose your keys again
Mario Balotelli substituted at half-time against Real Madrid: Was this shirt swapping the real reason?

Liverpool v Real Madrid

Mario Balotelli substituted at half-time. Was shirt swapping the real reason?
West Indies tour of India: Hurricane set to sweep Windies into the shadows

Hurricane set to sweep Windies into the shadows

Decision to pull out of India tour leaves the WICB fighting for its existence with an off-field storm building
Indiana serial killer? Man arrested for murdering teenage prostitute confesses to six other murders - and police fear there could be many more

A new American serial killer?

Police fear man arrested for murder of teen prostitute could be responsible for killing spree dating back 20 years
Sweetie, the fake 10-year-old girl designed to catch online predators, claims her first scalp

Sting to trap paedophiles may not carry weight in UK courts

Computer image of ‘Sweetie’ represented entrapment, experts say
Fukushima nuclear crisis: Evacuees still stuck in cramped emergency housing three years on - and may never return home

Return to Fukushima – a land they will never call home again

Evacuees still stuck in cramped emergency housing three years on from nuclear disaster
Wildlife Photographer of the Year: Intimate image of resting lions claims top prize

Wildlife Photographer of the Year

Intimate image of resting lions claims top prize
Online petitions: Sign here to change the world

Want to change the world? Just sign here

The proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?