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Last Updated:  Friday, 21 March, 2003, 17:46 GMT
Bush pursues guns and butter

By Steve Schifferes
BBC News Online in Washington

George Bush in Oval Office, 20 March 2002
Mr Bush: keeping an eye on home and abroad
President Bush says he wants to pursue his domestic agenda of tax cuts and health care reform even as the war begins in Iraq.

On Friday, President George W Bush called Congressional leaders to the White House to thank them for their support of the troops and the "message of unity" that they had sent after both Houses passed a resolution backing the war.

But it was not the first press statement of the day.

As we engage in action to ensure freedom and security, it is imperative that we stay focused on important domestic priorities
President George W Bush
Earlier, the White House had issued a statement praising the House of Representatives for passing Mr Bush's 2004 Budget request - a $2.2 trillion bill that includes the first instalment of his ten-year plan for $792bn in tax cuts.

"As we engage in action to ensure freedom and security, it is imperative that we stay focused on important domestic priorities, including creating jobs and strengthening economic growth at home.

"I commend the House for its timely action and look forward to working with Congress to ensure that we fund our priorities, enact policies to spur growth, and restrain spending."

Mr Bush, who is leaving for the presidential retreat of Camp David later on Friday, is leaving the operational details of the war to Defence Secretary Donald Rumsfeld.

Just as we commend our troops, it is time to do our job
Representative Jim Nussle, House Budget committee
But he is keeping close watch on the political battle in Congress as the war boosts his standing.

Pointedly, he held a full Cabinet meeting on Thursday, the first day of the war, to discuss his domestic priorities.

Fierce debate

Most Democrats, and some moderate Republicans, have been concerned that the president's tax cut proposals would create large budget deficits in future years.

And some warn that the budget vote should not come until the administration tells Congress the cost of the war.

Mr Bush, however, says that tax cuts are essential for reviving the weak US economy.

On Thursday, the House of Representatives narrowly passed the Budget resolution with Mr Bush's tax cuts intact, but a vote of 215-212.

"Just as we commend our troops, it is time to do our job," said House Budget committee chairman Jim Nussle, after intense lobbying of moderate Republicans by Vice-President Dick Cheney and White House chief of staff Andrew Card.

The budget bill will be debated on Friday in the Senate, where several Republicans have proposed reducing the size of the tax cuts by half.

"This is playing for the needs of the campaign next year. And I'm for the needs of the country," said Senator Ernest Hollings, a key moderate Democrat who might back the Republican plans.

Both houses of Congress have proposed balancing the budget by unspecified future spending cuts.

On current policies, the Congressional Budget Office says that there will be a $1.8 trillion deficit over the next ten years.

Opening of campaign

If Mr Bush succeeds in passing the budget this year, it will be a significant political victory after years of deadlock - and a sign of his increased political capital among the new Republican-controlled Congress.

It will also provide a powerful boost for his 2004 campaign by demonstrating that he is taking action to tackle the economy - still the biggest worry of many Americans.

With the budget in place, it will be hard for Democrats to oppose the big additional spending bill for the war and the reconstruction of Iraq that the president will send to Congress shortly.

The size of that bill is still unknown, but the White House has been warning the public for several days that the war could be longer and more costly than many expect.

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