GOP Deficit Hawks Challenge House Leaders’ Tax Cut Package

WASHINGTON —  House Republican leaders scrambled Wednesday to shore up support for their $190-billion package of tax cuts as it eroded under pressure from GOP mavericks who want the tax reductions to take effect only if substantial progress is made in cutting the deficit.

Backed by more than two dozen colleagues, Rep. Michael N. Castle (R-Del.) appealed to the House Rules Committee to let lawmakers make tax cuts contingent on achievement of future balanced-budget targets.

In a meeting of the Rules Committee on Wednesday, Castle warned against offering Americans tax cuts before making more progress in balancing the budget. “Everyone would like to skip their vegetables and go straight to dessert,” Castle said. “But, even a child will tell you, you shouldn’t do that.”

Castle’s proposal creates yet another challenge for House leaders, who already are trying to fend off an effort by more than 100 GOP lawmakers to prevent households earning more than $95,000 a year from qualifying for a proposed family tax credit.

The apparent desire of many House members to stress deficit control over tax reduction has prompted House Speaker Newt Gingrich (R-Ga.) to acknowledge that the GOP tax bill is “in some trouble.”

But Gingrich sent a group of lieutenants to determine what concessions might be offered to salvage support for the tax measure, considered the centerpiece of the GOP “contract with America.”

The wrangling forced the House Rules Committee to delay by a week a decision on how the bill will be debated and voted on on the House floor.

Gingrich appeared intent on heading off changes in the tax bill. But he has a problem: Some of his lieutenants, like Budget Committee Chairman John R. Kasich (R-Ohio) and Rules Committee Chairman Gerald B. Solomon (R-N.Y.), either are privately or openly sympathetic with efforts to amend the tax package.

While Kasich has defended the GOP tax bill, he is said by many colleagues to have personal reservations about a measure that would make balancing the budget more difficult than it is already. And Solomon, who chaired Wednesday’s hearing at which 21 amendments were proposed to the bill, was one of 10 House committee chairmen who recently signed a letter seeking to narrow eligibility for the $500-per-child tax credit.

“I suspect deep in the hearts of a number of people we’re negotiating with, they’re in agreement with us,” Castle said. At the same time, he added, Gingrich “didn’t say anything to give me any hope” that the Speaker would support Castle’s bid to place conditions on the tax package.

Rep. Greg Ganske (R-Iowa), one of the drafters of a letter seeking support for changes that would limit the per-child tax cut, said he was unaware of any efforts by Gingrich to accommodate the concerns of the 104 Republican lawmakers who signed the letter. He said that support for limiting the child tax credit to middle-income families has grown and expressed confidence that, if such a provision comes to the House floor, it would win the support of more than half the Republican members.

Castle and some other Republicans fear that an economic downturn would knock deficit reduction off the track to a balanced budget, which Gingrich has promised by 2002. If efforts to balance the budget go off track in any year, the rebels want the tax cuts automatically and permanently revoked within months.