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Friday, 14 February, 2003, 19:04 GMT
US budget battle ends
President Bush with businessman Joseph Dagher at a forum for small businesses
President Bush has been trying to reassure business

After months of wrangling, the US Congress has finally agreed how much money the US government will be able to spend on its key domestic programmes.

There is more pork with one vote than they have ever passed in their lives

Tom Schatz, Citizens Against Government Waste.

The spending bill, which covers all discretionary spending except defence, will come to $397.4bn (246.7bn), $13bn more than the Bush administration wanted.

The long and difficult budget process gave plenty of scope for individual Congressmen to add wasteful - or "pork-barrel" - projects that would help their own districts, threatening to hold up the passage of the entire bill.

Despite the extra cost, President Bush has pledged to sign the budget bill.

He now faces an even more prolonged battle over the next year's request for funds because to the budget deficit is expected to swell to $300bn.

Cowgirl Home of Fame

Fears that Congress would not be able to keep spending in bounds were behind the remarks of Federal Reserve chairman Alan Greenspan earlier in the week that he could not wholeheartedly endorse Mr Bush's budget and tax plans.

George W Bush
Mr Bush is facing a big budget deficit
And the spending bill provides plenty of examples, including $90,000 for a Cowgirl Home of Fame, $1.5m to repair an historic hotel in Glacier National Park, and $5m for an information campaign featuring McGruff the crime dog.

There were especially big projects for Alaska and South Carolina, the home states of the key Republican and Democratic Senators on the Appropriations Committee.

"All the money in this bill is the result of a backroom deal," said Representative David Obey, one of the Democratic negotiators.

Congress had previously been bound by a budget law which said that any new spending would have to be balanced by a cut in spending somewhere else, but that provision partly expired in November and has not been renewed.

Negotiators did defeat a proposal for an extra $2.5bn in farm aid, fearing it would anger developing countries that are the middle of crucial trade talks with the United States.

Critics call the wasteful projects pork.

"There is more pork with one vote than they have ever passed in their lives," said Tom Schatz of Citizens Against Government Waste.

Terrorism fears

Despite the increase of $10bn in spending on terrorist-related activities, Democrats said that the states and cities were not receiving enough funds to prepare properly for emergencies.

They had proposed an additional $2.5bn to help states and cities prepare for a possible attack.

"There are many egregious items in this bill, especially the lack of funding for critical homeland security needs," said House Democratic Minority Leader Nancy Pelosi.

Many of the Democrats who are running for President also plan to make the matter of protecting the civilian population one the key issues of their campaign.

The spending bill also severely restricts a controversial Pentagon programme to counter terrorism by mining the internet for information about individuals.

The Total Information Awareness Programme, headed by Admiral John Poindexter was intended to spot terrorist activities by monitoring e-mails and commercial databases for suspicious activities.

Paying for the elderly

It was much criticised by civilian libertarians, and now Congress has banned the US military from spying on US citizens or accessing their records.

The tortured US budget process is likely to become even more difficult next year.

The Bush administration has proposed big new spending initiatives for the military and wants to reform Medicare, while asking for a $692bn tax cut on dividend payments.

Meanwhile, other domestic programmes will be squeezed, with those aimed at poor people especially vulnerable.

And, in the long run, the looming problem of funding the social security system, which provides state pensions for the elderly, will create its own budget difficulties.

But the highly partisan nature of this Congress, with its narrow Republican majority, will make it extremely difficult to pass the next budget in time.

Key stories


Looming war




See also:

03 Feb 03 | Americas
02 Aug 02 | Americas
04 Feb 03 | Americas
11 Feb 03 | Business
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