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After vetoing a bill expanding the state children's heath insurance program, President Bush left Washington Wednesday.
After vetoing a bill expanding the state children's heath insurance program, President Bush left Washington Wednesday.
Ron Edmonds/AP

GOP looks to reclaim fiscal responsibility mantle

President Bush's veto of the S-CHIP bill Wednesday was the first fight over '08 spending.

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Reporter Gail Chaddock discusses Capitol Hill's looming budget showdown.

With the new fiscal year under way and no spending bills completed, President Bush and Congress are heading into a fight over fiscal responsibility that is likely to dominate politics on Capitol Hill until the end of the year.

President Bush's veto of a popular bill to provide health insurance for poor children, the S-CHIP program, on Wednesday marked a first volley.

The White House says the proposed bill is $30 billion more than what America can afford. Democrats say that the veto is a sign that Mr. Bush and Republican lawmakers who refuse to back a veto override have the wrong priorities.

"Today the president showed the nation his true priorities: $700 billion for a war in Iraq, but no health care for low-income kids," said House Democratic Caucus Chairman Rahm Emanuel (D) of Illinois, in a statement.

But the 12 pending appropriations bills for fiscal year 2008 – and a new war-funding request expected this fall – will test the credibility of both sides of the aisle.

For Republicans, battered by Bush's low approval ratings, the fall budget battles are a chance to show angry conservatives that the GOP is getting back to a concern over a restraint in spending.

"This marks the president's last chance to reassert control over the budget process that's been allowed to flail along wildly for six years now," says Pete Sepp, a vice president at the National Taxpayers Union in Alexandria, Va. "If this is an effort to reestablish credentials [with fiscal conservatives], there is a lot more reestablishment to do beyond S-CHIP. The sincerity of this effort will be judged by the number of vetoes."

The 12 spending bills passed by the House are already some $23 billion more than the $933 billion that Bush requested in his FY 2008 budget in February. Bush says the increases are irresponsible and he has threatened to veto nine of the 12 bills. The overall federal budget for FY 2008 is $2.7 trillion.

But conservative activists say the cost over the next 10 years of programs set in motion this year will be hundreds of billions of dollars.

"Iraq is not forever. Any newly initiated spending project is," says Grover Norquist, president of Americans for Tax Reform, an antitax group. A big fight over spending will help the GOP rebuild bridges with the conservative movement, he says. "If the president spends the last year-and-a-half of his presidency in a knock-down, drag-out fight on spending, this will be remembered. The modern Republican Party will be regaining its brand with his leadership. The country needs an antispending party, and we lost it for a while."

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