House GOP Moves to Put New Surpluses Toward Debt

Faced with virtually no prospect of seeing large tax cuts enacted while Bill Clinton is president, House Republicans unveiled a proposal Wednesday to require that any new federal budget surplus be used to reduce the national debt.

The bill would apply only to this year’s budget, meaning that the next president--the GOP hopes that will be George W. Bush--could pursue a sweeping tax-cut plan. But the new measure demonstrates the increasing emphasis among congressional Republicans on debt reduction at a time when public pressure for their signature issue--tax cuts--seems to be on the wane.

The legislation also is designed to block any effort to funnel additional surplus money into government programs.

“Debt relief should be a top priority, not an afterthought,” House Ways and Means Chairman Bill Archer (R-Texas) said Wednesday. “This plan says it’s time for Washington to pay its bills.”

If the bill becomes law, it would mark the first time since 1917 that Congress has voted to reduce the national debt.

The bill would not prevent Republicans from continuing to push for the $150-billion, five-year tax cut included in their proposed budget--including provisions to repeal the so-called marriage penalty and abolish the estate tax, along with other forms of tax relief. It would, however, fence off and earmark for debt reduction any revenues in excess of the $24.4-billion surplus projected by the Congressional Budget Office for this year’s budget.

Analysts predicted that the CBO’s surplus estimate will grow to at least $40 billion this summer, when its projections are revised in light of changing economic conditions.

Under the bill, the add-on to the surplus would have to be deposited in a new Treasury Department account dedicated to reducing the national debt. The debt now totals about $5.7 trillion, including $3.6 trillion of publicly held debt and $2.1 trillion that the government owes to Social Security and other trust funds.

Despite their differences on spending and tax policy, Clinton and congressional Republicans generally have agreed on the goal of eliminating the national debt by 2013.

The GOP-controlled Congress approved a 10-year, $792-billion tax cut in August and then hoped a public drumbeat of support would persuade Clinton to sign it. But such backing never developed, and the president vetoed it.

In this year’s presidential campaign, a key aspect of Bush’s agenda is his call for a five-year, $483-billion tax cut. While supporting the Texas governor’s plan, congressional GOP leaders want to keep any new surplus from being spent by Clinton and members of Congress--including members of their own party--in year-end budget negotiations.