House Approves Arctic Drilling

End-Of-Session Vote Opens Way For Oil Exploration In Alaska Wilderness

(AP) 
GOP conservatives, disturbed that their party has overseen a surge in government spending and massive federal deficits, applauded a provision in the defense bill that would cut all discretionary federal programs, except those affecting veterans, by 1 percent in fiscal 2006, producing savings of $8.5 billion.

They also hoped to take home news of the $40 billion deficit-cutting bill, which will hardly make a dent in the nation's $8 trillion debt but would be the first time since 1997 that Congress has reined in the growth in spending on federal benefits programs.

"Tonight the Congress will renew our commitment to the principles of fiscal discipline and limited government that minted this majority," said Rep. Mike Pence, R-Ind., who leads a group of House conservatives.

Republicans originally put the savings at $41.6 billion, but that figure was later reduced to $39.7 billion with restoration of Medicare payments for oxygen patients, a late concession to lawmakers with interests in the durable medical equipment industry.

Planned spending on Medicare was estimated to fall by $6.4 billion and Medicaid by $4.8 billion. Another $13 billion would be saved from student loan programs, in part by establishing a fixed 6.8 percent interest rate instead of maintaining lower variable rates.

The largest single savings in Medicare would reduce anticipated federal funding for the private HMOs established under 2003 Medicare legislation.

Officials said the changes to Medicaid include an attempt to make it harder for the elderly to transfer their assets to children or others in order to qualify for federal nursing home benefits.

Lawmakers had to abandon other measures that would have expanded the deficit-cutting package. They agreed, at a cost of $7.3 billion, to eliminate a scheduled 4.6 percent cut in physician payments under Medicare.

The House early Monday passed, on a 374-41 vote, a separate defense bill that sets Pentagon policy and authorizes military programs. Action on the bill was held up by resistance to an attempt by Republican leaders to attach language, eventually removed, to limit individual political donations to independent organizations, a source of financing that proved especially valuable to Democratic candidates in 2004.

The bill contains a 3.1 percent pay raise for military personnel, an increase in the death gratuity for the families of active duty personnel to $100,000 and an increase in the enlistment bonuses for active duty to $40,000.