Clinton Deficit Plan Squeaks Through House, Faces Senate : Budget: The 218-216 vote, with no support from GOP, comes after hard lobbying of wavering Democrats. The White House pledges to offer further spending cuts.

With President Clinton’s political fate hanging in the balance, the House barely mustered the votes Thursday to approve his deficit reduction plan, sending it to the Senate for another nail-biting showdown today.

The House’s approval, on a 218-216 vote, capped a day of supreme anxiety among Democrats, who had more difficulty than forecast even by Republicans--none of whom broke party ranks to support the $496-billion package of spending cuts, massive tax increases on the wealthy and an average dime-a-day hike in the gasoline tax.

Throughout the day, Democratic leaders jawed with wavering members in cloakroom, corridor and coffee shop, succeeding on occasion only to find that another member thought to be leaning toward approval was in fact hurrying the other way. By midafternoon, leadership aides conceded that they were still 9 or 10 votes short of the 218 that would guarantee passage.

Seeking to pick up last-minute support, the Administration and House Democratic leaders promised to bring up more spending cuts in September and October, before Congress adjourns for the year, to show their continued commitment to defict reduction.

“It’s time to bite the bullet on the biggest vote of the Clinton presidency,” said Rep. Bill Richardson (D-N.M.). “All of our necks are on the line.”

In the Senate, even Democratic optimists were hoping for a tie, which Vice President Al Gore would break. Gore did so when the original Senate version was approved in June, despite solid Republican opposition and defections by six Democrats.

The legislation is considered crucial to Clinton because it is a central element of his Administration’s agenda. It also has emerged as a severe test of his ability to push legislation through Congress. Its defeat would cast grave doubts on the future of two other major Administration objectives: health care reform and the North American Free Trade Agreement among the United States, Canada and Mexico.

Despite the eleventh-hour support of Sen. Dennis DeConcini (D-Ariz.), which could prove to be the decisive vote, Administration officials were reported to be worried that unpredictable Sen. Bob Kerrey (D-Neb.) might vote against the measure and possibly doom it in the closely divided chamber.

The spotlight shifted to Kerrey after Sen. Richard H. Bryan (D-Nev.) announced Thursday that he would vote against the plan.

But Thursday’s focus was on the House, where the plan had to be passed before the Senate could take it up today. Congress plans a monthlong summer recess after the votes.

The President cleared his schedule and spent hours on the telephone with Democrats in an effort to pin down votes for his plan, but he generally kept a low profile as the House continued its marathon debate.

The arguments were familiar. Democrats said it was a critical first step to gain control of the budget deficit--trimming it by nearly $500 billion over five years--and to preserve low interest rates that would spark an economic revival.

Rep. Martin Olav Sabo (D-Minn.), chairman of the House Budget Committee and a conference committee negotiator of the final version of the bill, said it was time for Democrats to act.

“This package represents the opportunity of a lifetime to turn this country around,” Sabo said. “There will never be a better time to do it. It will get harder, not easier, if we put it off.”

The alternative, Sabo said, would be higher deficits, increases in interest rates and a shaken economy.

But Rep. Chet Edwards (D-Tex.), one of those whom Clinton tried unsuccessfully to persuade, explained why he and many other Democrats decided to oppose the budget bill.

“The bottom line is that a bunch of us couldn’t sell our constituents on the idea that Congress was serious about deficit reduction,” Edwards told a reporter.

Bolstered by the surge of phone calls that clogged Capitol Hill switchboards, Republicans gloated that Democrats would be defeated in 1994 and Clinton would not be able to win reelection if the measure is passed.

Republicans argued that retroactive tax increases on upper-income Americans would stifle growth and kill jobs while spending cuts would not be effective until after Clinton’s four-year term is over.

“This is not taxing the wealthy--this is taxing America,” Rep. John T. Myers (R-Ind.) complained. “Quick to tax, slow to cut,” said Rep. Constance A. Morella (R-Md.), criticizing the provision for retroactive tax increases and deferred reductions in spending.

But Rep. Ike Skelton (D-Mo.), a conservative Democrat who voted against an earlier version of the measure, decided to switch and support the compromise plan. Noting that flood relief in the Midwest might cost as much as $20 billion, he said the deficit-cutting measure is even more important.

“This is a step in the right direction,” Skelton said to applause from the Democratic side of the chamber.

The 175 Republicans in the House voted solidly against the bill, which they claimed would be an economic disaster and make Clinton a one-term President. Forty-one Democrats voted against the plan.

Although the Democrats have prevailed so far, Republicans have succeeded in demonstrating that, despite Democratic control of the White House and Congress, they can influence major Clinton Administration legislation, such as health care reform and the looming North American Free Trade Agreement with Canada and Mexico.

By voting as a solid block, the Republicans have shown that they can, at a minimum, give legislation a strong yank to the political right by forcing the Democratic leadership to offer proposals palatable to the conservative wing of their own party if they are to muster enough votes for approval.

In the struggle over the budget bill, for instance, the House leadership entered into a formal agreement to present new budget enforcement legislation in September and to pursue additional spending cuts before adjourning this year.

Also, the White House promised that Clinton would seek additional reductions in spending in October that House members may accept or expand, Speaker Thomas S. Foley (D-Wash.) and House Majority Leader Richard A. Gephardt (D-Mo.) said. This list of cuts will include savings recommended by a commission reviewing government operations and efficiency.

Under a little-used power of the presidency, Clinton can ask Congress to cancel previously approved spending in a special request known as a “rescission” bill. Congress may accept his recommendations, substitute its own spending reductions instead or do nothing.

The promises apparently succeeded in winning at least one vote, from Rep. Timothy J. Penny (D-Minn.), a veteran budget-cutter.

The House also will be given an opportunity to vote on a pay-as-you-go system for financing future disaster relief bills, the leadership said.

In addition, Foley gave assurances that the House will take up a constitutional amendment requiring a balanced budget if it passes the Senate this fall.

“The vote today is the beginning, not the middle or the end of the process of increasing spending cuts,” Foley and Gephardt said in a statement outlining the steps that they agreed to take only hours before the decisive roll call.

One of the most controversial provisions in the bill would slow the growth of payments to Medicare providers--doctors, hospitals and laboratories--by $55.8 billion over the next five years. Although advocates of the cut argued that it would not affect the elderly or disabled who are covered by the program, Medicare proponents said it might affect the quality of patient care.

Similarly, outlays for the Medicaid program for the poor were reduced by $7.6 billion over the next half-decade as part of the deficit-cutting drive.

In addition, in a precedent-setting move, the bill includes a five-year freeze in spending on one-third of federal programs, paid for by annual appropriations, at the same dollar levels that exist now. Proponents of the bill estimated that this provision alone would reduce outlays by $102 billion.

The legislation also contained other, little-noticed provisions that would restrain the growth of federal outlays by more than $32.5 billion over the next five years.

It would lower spending by $11.9 billion for federal retirement programs, primarily by eliminating the option to receive lump-sum pension payments and by delaying cost-of-living raises for federal employees and members of the armed services, starting in 1994.

Sponsors of the bill estimated that it would raise $10.2 billion by auctioning parts of the radio spectrum to commercial users. Another $4.3 billion would be saved by changes in student loan programs; a total of $3 billion less would be spent on a variety of agricultural programs; veterans’ programs would be trimmed by $2.6 billion, and an additional $2.4 billion would be raised by extending custom users’ fees through 1998.

Some provisions would raise spending, including a proposed $2.5-billion increase for the food stamp program and a new $1-billion allocation for a social welfare program designed to keep families together and reduce the amount of foster care.

The compromise bill rejected a widely unpopular energy tax based on British thermal units and replaced it with a 4.3-cent-a-gallon increase in gasoline and diesel fuel.