Congress's sham savings The New York Times TUESDAY, NOVEMBER 8, 2005 That rare creature, the moderate Republican lawmaker, is suddenly in sight, forcefully objecting to the U.S. House of Representatives leadership's abominable package of budget cuts for the poor and environmental licentiousness for the energy industry. The five-year, $54 billion proposal is headed for a floor vote this week disguised as an overdue act of fiscal responsibility and government savings. In truth, it is so over-the-top in its inequities and giveaways that embarrassed moderates are actually rebelling, withholding support unless some of the more outrageous measures - like despoiling the Alaska wildlife refuge with oil drilling - are killed. The Republican-led Senate has already approved its own $35 billion budget-cutting measure that seems a model of moderation compared with the House's proposed mayhem. It is important to understand, however, that neither approach delivers the net savings being grandly claimed. An additional $70 billion worth of upper-bracket tax cuts heavily backed by the White House are waiting in the wings and will drive the deficit even deeper across generations of taxpayers. The administration and congressional leaders arranged separate votes on the two halves of the budget to obscure the full picture. The tax-cut madness mocks the budget-hawk posture the congressional Republicans will be claiming in the next elections. Taxpayers once wooed with promises of compassionate conservatism should pay close attention to details of the rival budget plans. Chief among them is the House's mean-spirited cut of $12 billion in Medicaid access and benefits for the poor. It would invite budget-stressed states to levy health care co-payments and pass tougher workfare rules while crimping child care, food stamps and other anti-poverty programs. The far saner Senate approach is to largely spare Medicaid but squeeze bloat from Medicare in the form of a notorious $10 billion "stabilization fund" for providers that Congress's own advisory panel has warned is a windfall gimmick. President George W. Bush is threatening to veto the entire bill over this, but the Senate should stand fast. The conservative bloc has used the unexpected costs of Hurricane Katrina to justify its sudden clamor for budget slashing. But that doesn't hold up to its actions. The Senate began the budget process with estimates that $9 billion was needed for emergency Medicaid for thousands of hurricane victims and refugees. But the White House forced the Senate to cut that to $1.8 billion in the actual budget bill. And for all the post-Katrina vows to boost emergency winter heating subsidies as oil prices spiked, the Senate approved only the $2.2 billion that was planned before the hurricane hit. The Senate deserves credit for eliminating a major cotton support program, one of the many agricultural subsidies that allow American corporate farmers to sell products overseas at well below the cost of production and squeeze the living out of farmers in the poorest countries on earth. But its approval of the Alaska oil-drilling foray is a grave misstep. It will be made worse by the House's destructive plan to revive off-shore oil drilling and allow an environmental rip-off through the sale of public lands to developers at bargain prices. Once the House passes its version of the spending bill, an even wilier form of budget politics will follow - the final, closed bargaining of conferees from the House and Senate. House leaders might easily jettison Alaska drilling to appease moderates this week, while counting on the Senate bargainers to keep it in final compromise. It will be a test, too, of the Senate's more responsible budgeting to see if its negotiators allow the House to prevail on things like food stamps and Medicaid. There was not much comfort in the vote in the Senate last week to defeat a proposal to restore the pay-as-you go discipline - spending balanced with adequate revenue flow - that produced surpluses in the 1990s. This Congress helped kill off those surpluses, but even Alan Greenspan, chairman of the Federal Reserve, has come round to warning lawmakers against cutting taxes by increasing the already damaging budget deficit.