Gore Casts Tie-Breaking Vote as Senate OKs Clinton Budget : Deficit: 51-50 tally ends bitter battle and gives President a major triumph. Victory was assured when Sen. Kerrey said he was reluctantly backing the plan.

President Clinton’s sweeping economic program of tax increases and spending cuts narrowly cleared its last congressional hurdle Friday night, when the Senate ended a bitter, six-month battle and approved it, 51 to 50, with Vice President Al Gore casting a tie-breaking vote.

Immediately after the outcome was announced, the normally sedate Senate erupted in cheers and was quickly chided by the vice president, who called for order.

Victory in the tortuous process was assured only in the last hour before the vote, when Sen. Bob Kerrey (D-Neb.), the final holdout, announced that he would reluctantly support the plan rather than bring down the first Democratic presidency in 12 years.

“This plan is a first step--not the only one, not the last one--but a first one,” Senate Majority Leader George J. Mitchell (D-Me.) promised the senators as they prepared to vote on the unpopular package that some feared could end their political careers. “Join me in voting yes on this bill, not for your reelection. . . . Make the decision based upon what is best for our country.”

But it was a vote that few were enthusiastic about having to cast.

In a dramatic speech that ended days of Hamlet-like public agonizing, Kerrey accused Clinton of backing away from his call for “shared sacrifice” to conquer the deficit. “The price of this proposal is too low. It’s too little to match the greatness needed from Americans now, at this critical moment in this world’s history,” he lectured Clinton, pleading: “Get back on the high road, Mr. President, where you are at your best.”

Nonetheless, Clinton’s one-time rival for the Democratic presidential nomination added: “I could not, and should not, cast a vote that brings down your presidency. . . . I do not trust (the Senate’s) 44 Republicans enough to say no to this bill.”

With Kerrey’s commitment, the Senate was evenly divided, opening the way for Gore to cast the vote that would send it to Clinton’s desk to be signed into law. Gore played the same role when the Senate stalemated over its original version of the budget bill earlier this summer.

When Kerrey made clear which way he would vote, Senate Finance Committee Chairman Daniel Patrick Moynihan (D-N.Y.) leapt to his feet in a standing ovation, and Kerrey’s Democratic colleagues rushed to congratulate the Nebraska senator. White House aides, watching on television, broke into applause.

Throughout the day, Clinton himself, along with senior Administration officials and Senate leaders, spared no effort to win Kerrey over as the final 10 hours of Senate debate were running out. The President spoke to his one-time rival for the presidency three times Friday, once in person at the White House and twice by phone.

As the wooing of Kerrey wore on, 10 hours of debate raged on the Senate floor over the highly controversial bill that is designed to reduce the soaring federal deficit by $496 billion over five years through spending cuts and tax increases. The tone of the seemingly endless oratory was marked by the same bitter partisanship that has characterized the negotiations over the budget package since Clinton introduced it in mid-Februrary.

Clearly, both sides recognized that the vote on the bill represented the most significant test faced thus far by the President and could indicate how he might fare in the major initiatives still to come, among them, health care and welfare reform.

Democrats promised that Americans would find new jobs by the millions and rarely missed an opportunity to align Republicans with the special interests of the well-to-do or to lay blame for the nation’s staggering deficit at their feet.

“The Republicans do not like our plan. This is not surprising. We do raise taxes on the wealthiest Americans,” Sen. Barbara Boxer (D-Calif.) said, adding that Republicans “never forget who brought them to the dance. I say they have had their chance and California has suffered from these policies.”

In turn, Republican after Republican rattled off cataclysmic forecasts of massive job losses and warned that the Clinton plan would devastate small businesses, the primary engine of job creation in the fragile economic recovery.

“Once you strip away the White House public relations veneer, you get to the real truth,” said Sen. Pete V. Domenici of New Mexico, the ranking Republican on the Senate Budget Committee.

On occasion, despite the momentous step they were poised to take, some senators digressed during speeches on the chamber floor to take up issues of more narrow and personal concern: Sen. John W. Warner (R-Va.) to argue for more stringent laws governing truckers and Sen. Orrin G. Hatch (R-Utah) to complain about an unfavorable television report on him.

More than one senator relied on the charts and graphs that have become standard fare since the presidential candidacy of Ross Perot to drive home economic points. But only one--the flamboyant Republican from New York, Sen. Alphonse M. D’Amato, resorted to magic.

To dramatize his dim view of the budget bill, he made a dollar disappear, prompting Senate Budget Committee Chairman Jim Sasser (D-Tenn.) to suggest that he consider a new career on the carnival circuit.

Hyperbole was the order of the day. Sen. Charles E. Grassley, (R-Iowa) compared the bill to “a blivet--five pounds of manure pounded into a four-pound sack. The point is, if you vote for this package, you’re voting for deep doo-doo.”

House and Senate negotiators have spent weeks in their efforts to produce the final package, which was a compromise drawn from plans that had narrowly passed the two houses earlier this year.

On Thursday night, the House approved the compromise package by a cliff-hanging two-vote margin. Not a single Republican supported the plan in the House and none was expected to vote for it in the Senate.

Supporters claimed that the final bill would reduce the federal deficit, which is now running at roughly $300 billion annually, by $496 billion over the next five years. Instead of rising to $361 billion in fiscal 1998, as it would under current policies, it would fall to about $213 billion.

However, all the projections are based on assumptions about the underlying performance of the economy, and as past history proves, those projections can be wrong.

After many changes by Congress, the bill retains the central elements of Clinton’s original plan. Most significantly, it changes course from the tax policies of the 1980s, shifting more of the overall burden to the wealthy.

An estimated 90% of its $241 billion in new taxes would be paid by individuals and families earning more than $100,000 a year. The legislation also imposes $255 billion in spending cuts, the largest of which will come from Medicare and are significantly deeper than Clinton proposed.

At the same time, Congress rejected Clinton’s initial proposal for a broad-based energy tax and accepted instead a far smaller 4.3-cent-a-gallon addition to the federal gasoline tax, currently 14.1 cents a gallon. The change had been necessary to win the votes of a handful of balky senators, some from oil-producing states.

Lawmakers also scaled back or eliminated some of the new spending and investment incentives that Clinton had initially sought. The final package expands by $21 billion the earned income tax credit for low-income working people, and provides relatively modest increases in social spending and investment incentives.

Overall, according to figures cited by Boxer and Sen. Dianne Feinstein (D-Calif.), roughly 300,000 of California’s 13 million federal income tax filers will pay more, while the taxes of 2 million will be lower. Virtually everyone will pay more in gasoline taxes, which the Administration estimates will average about 46 cents a week for West Coast taxpayers.

For Democrats, Boxer said, the vote was one of “political courage.” Indeed, every lawmaker voting for it was well aware that, as they adjourned for their August recess, they were going home to voters who are outraged over the bill’s tax increases and spending cuts.

Moreover, even if the plan lives up to its billing, its promised benefits are unlikely to materialize in time to allow lawmakers to take credit for them in next year’s elections, when all 435 House members and one-third of the Senate will be on the ballot.

To the contrary, in the view of many economists. They say that while the plan is better than doing nothing about the deficit, in the short run, its higher taxes and lower government spending are likely to be a drag on the economy that would only partly be offset by the more nebulous stimulus of lower interest rates.

While all these considerations made voting for the plan difficult, most Democrats believed that there was an even worse alternative: killing the package and having no deficit-reduction plan at all to offer for their efforts.

In fact, both parties have been guilty of confusing public opinion by massaging the figures to suit their own purposes.

Clinton and the Democrats, for instance, take every opportunity to tout the bill as the largest deficit-reduction package in history--which is true only if inflation is not taken into account.