Republicans say Democrats want to set political trap with economic stimulus plan

By CURT ANDERSON
AP Tax Writer

WASHINGTON – Negotiations on legislation to stimulate the economy hit another snag Thursday. Republicans accused Senate Democrats of setting impossibly high political standards for a compromise.

With the talks on a one-day break, Republicans objected fiercely to a decision by Senate Majority Leader Tom Daschle, D-S.D., to require that any deal be acceptable to a solid majority of the 50-member Senate Democratic caucus. Independent Sen. James Jeffords of Vermont also caucuses with the Democrats.

Republicans said that was an unrealistic hurdle for any stimulus bill that includes significant tax relief, given opposition among many Democrats to more tax cuts on top of the 10-year, $1.35 trillion tax cut enacted earlier this year.

"If they're trying to prevent a stimulus deal, this is the way to do it," said Sen. Charles Grassley of Iowa, ranking Republican on the Senate Finance Committee and the Senate GOP's negotiator on the bill. "This litmus test is designed to limit any agreement to a Democrats-only deal."

Daschle has said several times that any bill produced by the bipartisan House-Senate negotiations should satisfy demands of most in his Democratic caucus. Republicans erupted Thursday after Roll Call, a Capitol Hill newspaper, reported that the threshold was roughly two-thirds of the Senate Democrats.

"This is a hurdle that can only be meant to undermine the conference," said Michele Davis, spokeswoman for Treasury Secretary Paul O'Neill.

Some Republicans suggested that Daschle's decision could even delay the negotiations, which were scheduled to continue Friday and Saturday.

"It virtually guarantees that no deal could be struck," said Terry Holt, spokesman for House Majority Leader Dick Armey of Texas, a House negotiator. "We would be committing ourselves to a process that would be bound to fail."

Daschle, for his part, did not mention the Democratic caucus threshold when he met with reporters Thursday morning. Instead, Daschle said House GOP concessions on unemployment benefits and aid on health insurance for the jobless were not a bad start but still have "a lot of shortcomings that we're going to have to address."

"I'm hopeful that we can keep negotiating," he said.

The Republicans have offered a 13-week extension of unemployment benefits, which Democrats have demanded, as well as a tax credit and voucher for laid-off people to afford health insurance. Previous GOP plans offered grants to states to tackle these problems. Democrats are seeking even broader relief.

President Bush and the Republicans also want to accelerate income tax cuts now set to take effect in the future, approve another batch of rebate checks, boost expensing and depreciation write-offs for business and provide corporate alternative minimum tax relief.

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APNP-12-06-01 1610CST