ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Tuesday, December 12, 1995 TAG: 9512120078
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: Associated Press
In a boost for long-stalled budget talks, Republicans in Congress and the White House were handed a $135 billion windfall Monday, newfound money available within the framework of a seven-year balanced budget.
Rep. Tom DeLay of Texas, the House Republican whip, suggested some of the money could be allocated to Medicare, agriculture, education and other programs that Democrats claim were shortchanged in legislation that President Clinton vetoed last week.
The $135 billion was identified by Congressional Budget Office analysts, who said the outlook for inflation and interest rates had improved since their last forecast, while the prediction for economic growth had worsened somewhat.
Sen. Pete V. Domenici, R-N.M., chairman of the Senate Budget Committee, said after he and other lawmakers met with CBO officials that Republicans would attempt to craft a ``more attractive'' proposal in the next several days.
White House Chief of Staff Leon Panetta said, ``This gives us an opportunity to do some hard negotiations and avoid a government shutdown by Friday.''
Spending authority for several agencies expires Friday at midnight, and House Speaker Newt Gingrich has said he won't advance legislation to restore the money unless there are serious negotiations with the White House on balancing the budget.
Optimism over the $135 billion was tempered by a CBO finding that most of the impact on the deficit would be felt in the next five years; only $12 billion in the sixth year and a negligible amount in the seventh. As a result, any changes must be crafted to avoid throwing the entire plan out of balance in the critical seventh year.
Democrats said that would complicate efforts to reach a budget compromise in the next 10 days.
``We've got a long, long way to go,'' said Sen. James Exon, D-Neb., who cautioned against believing that the CBO report was the economic equivalent of ``sugar plums'' at Christmas time.
Republicans had vowed to use CBO's estimates in deriving their figures for balancing the budget and had eagerly awaited the new forecast. GOP lawmakers said they were hoping to resume negotiations with the White House and Democrats today.
Democrats said with satisfaction that the CBO had moved closer to the administration's generally more optimistic assumptions. The White House had claimed the budget could be balanced at a cost of $400 billion less than the last GOP plan.
LENGTH: Medium: 56 linesby CNB