Spending bill reveals old and new priorities

A wide-ranging spending bill that passed the House and awaits Senate action is a milestone in the transfer of power in Washington: While attracting little public attention, it is both the last budget measure of the Bush administration and the first of Barack Obama’s presidency.

The $410-billion spending bill is meant to make up for Congress’ failure last year to approve all the basic appropriations bills needed to keep the government running.

The bill is also an object lesson in what a difference an election can make and, at the same time, how much things remain the same.

If George W. Bush were still in the White House, Congress probably would be under pressure to spend less overall -- and more for Bush priorities such as foreign policy initiatives or support for a school voucher program.

In the measure before the Senate, many of those items have been stripped out or downgraded, only to be replaced by the favored programs and priorities of the Democrats who now control Congress and the White House.

At the same time, the bill is laden with earmarks for parochial projects that candidate Obama denounced as wasteful, politicized spending, and that have slowed approval of the bill in the Senate, where Republicans have attacked earmarks even as many in the GOP have benefited from them.

Among Democrats, the bill has set off new concerns and thrown the party on the defensive about the overall level of federal spending -- the cost of this bill plus the $787-billion stimulus package and billions more to help homeowners and to revive the financial system.

Despite the last-minute problems, the Senate is expected to approve the holdover spending this week and Obama is expected to sign it despite his complaints about earmarks, including some reportedly left over from his time in the Senate.

Yet the bill has uncovered tensions over spending, not only between the White House and Republicans but between the president and many congressional Democrats.

Democratic leaders have defended their power to set spending priorities -- and the controversial earmarks as a legitimate exercise of it. Some bridled at suggestions that Obama could crack down further in the future.

“I don’t think the White House has the ability to tell us what to do,” House Majority Leader Steny H. Hoyer (D-Md.) told reporters last week. “I hope all of you got that down.”

Sen. Evan Bayh (D-Ind.) wants the president to veto the bill. In an interview, Bayh said that killing the bill would give Obama a chance to show he is serious about stamping out earmarks.

A veto would “set the tone for how we’re going to deal with our fiscal problems going forward,” Bayh said. “We’re increasing spending many times the rate of inflation at a time when many families are cutting back. That could lead to voter anger -- and rightfully so.”

Meanwhile, the $410-billion holdover spending measure has given Democrats a chance to put a modest stamp on government policy. For one thing, the overall price tag is an 8.3% increase over 2008 -- a jump that Republicans claimed was the biggest for the programs involved since 1978, except for that following the Sept. 11, 2001, attacks.

A spending bill was needed because Bush and congressional Democrats last year could not agree on funding for most domestic programs, including those in education, health and the environment.

Taking aim at one of Bush’s signature foreign policy programs, the bill slashes spending by more than 40% for the Millennium Challenge program, which Bush started to help promote democracy and development in poor nations.

It also loosens some of the strict limits the Bush administration imposed on travel and trade to Cuba.

And the bill provides no funding for a Bush proposal to develop a new generation of nuclear weapons.

On the domestic front, the bill would terminate a reading program, once funded at $1 billion a year, which had been a key part of Bush’s education plan. And it lays the groundwork for killing a Bush-era experiment with school vouchers in the District of Columbia.

On the other hand, Democrats poured in money for social programs they think got short shrift under Bush -- including some that were already given big increases in the economic stimulus bill. Big winners are education, health and scientific research.

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janet.hook@latimes.com

Peter Nicholas in our Washington bureau contributed to this report.