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Congress Seeks Economic Plan

By Janet Hook

As a nervous Congress groped for a remedy for the ailing economy, Senate Republican Leader Trent Lott, R-Miss., proposed Monday linking tax cuts for investors -- a GOP favorite -- with some form of payroll tax relief that has been endorsed by Democrats.

Although Democrats reacted coolly to the suggestion, the fact that Lott was open to such an idea provided a measure of how feverish the Republicans’ search for an economic stimulus plan has become.

A new round of tax cuts was just one of many ideas being kicked around as lawmakers -- particularly President Bush’s Republican allies -- grappled with their twin fiscal problems: an economic downturn and the dwindling budget surplus.

“Ideas are bouncing off the wall and ceiling,” said Doug Hattaway, spokesman for Senate Majority Leader Tom Daschle, D-S.D.

It was not clear which ideas -- if any -- would become law, but it was clear that the worsening economic and budget outlook is coloring almost every issue before Congress.

This week, for example, House GOP leaders may postpone a planned debate of a costly farm bill because they worry the bill will be cast as a budget buster -- and possibly go down to defeat.

Fear of a return to deficit spending hung over negotiations between the parties over appropriations for education and defense. House Appropriations Committee aides said negotiators from the administration and both parties in Congress were trying to agree on a way to write remaining appropriations bills to allow increases for education and defense without using surplus Social Security revenues. But aides from both parties conceded that some accounting gimmickry would probably be necessary.

What’s more, the Bush administration was negotiating with lawmakers pushing for another guarantee that Social Security surpluses not be used for other programs. Their bill would require across-the-board spending cuts if Congress overspends the surplus. Authors of the bill -- Zell Miller, D-Ga., and George Voinovich, R-Ohio -- postponed a scheduled news conference Monday to continue talks with the administration, in hopes of winning the president’s support.

The jockeying reflects a growing sense of urgency among members of Congress about the need to take some action on the economy. Republicans especially fear the wrath of voters in the 2002 elections if conditions do not improve soon.