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Final Deals Taking Shape

As Members of Congress continue to seek an exit strategy that will allow them to leave town before Christmas — if not this week — Democrats are weighing a series of compromises that they hope will yield breakthroughs on energy, a farm bill, the alternative minimum tax and a massive omnibus spending package that seems destined to include significant war funding.

The appropriations endgame is starting to coalesce around a plan to trade funding for the war for domestic spending, although the plan still faces significant obstacles and remains far from a sure thing.

Senate Democratic leaders appear most optimistic about their ability to broker a deal on the energy bill and to finish the farm bill.

Senate Democrats also hope this week to squeeze in debate of a bill to overhaul the Consumer Product Safety Commission in the wake of a rash of recalls involving Chinese-made toys that contain unsafe levels of lead paint.

“We will try to have them address consumer protections,” a Senate Democratic leadership aide said. “I can’t understand why two weeks before Christmas Republicans would balk at toy safety.”

All of that likely will take place prior to expected House passage next week of an omnibus spending bill that only includes perhaps $30 billion in war funding for troops in Afghanistan. Once it comes over to the Senate, a knowledgeable Democratic source said, an amendment will be offered — perhaps by a Republican or conservative Democrat — to add as much as $30 billion for the Iraq War.

While that Senate amendment is likely to pass, as is the underlying bill, the measure could still stall in the House or be vetoed. Speaker Nancy Pelosi (D-Calif.) has repeatedly said she has no plans to bring up a spending bill for Iraq this year that does not include a withdrawal timetable, and more than 90 Democrats have vowed to vote against any Iraq funding that does not support a withdrawal.

Democrats are trying to find some way to pass extra military funding without actually having the word “Iraq” attached to it in order to save face and avoid irking their base, but the money in the end would allow the war to continue for months via transfer authority. House Democrats, however, also envision two votes on the package — one on the domestic spending that would be carried largely by Democrats and a separate vote on war funding that would be expected to be carried largely by Republicans. The package then would be sent to President Bush.

House Republican leaders, meanwhile, are fuming over Senate Republican plans to cut a guns-for-butter deal. The way they see it, they have the Democrats on the ropes already.

“I adamantly oppose that,” House Minority Leader John Boehner (R-Ohio) said. “I came here to hold the line on spending, not raise it.”

A House GOP leadership aide said Democrats ultimately will have to cave on war funding and domestic spending levels if Republicans just wait them out.

“House Republican leadership feels we’ve worked really hard all year long to get to the point that we are at right now,” the aide said. “They have nothing done and virtually no leverage to get it all over the finish line, so why on earth would we be negotiating?”

But if Bush signs off on the deal, House Republicans lose their relevance.

The omnibus is expected to come in at about $11 billion over the president’s budget, but nearly $11 billion under what Democrats originally wanted to spend on domestic programs, although Republicans hope to pare that back even further.

Still, both parties in the Senate remained optimistic about the outcome for the omnibus. Senate Appropriations ranking member Thad Cochran (R-Miss.) said he has been heartened by the concessions Democrats appear ready to make.

“There’s movement, and that’s good,” Cochran said Friday. Still, he said the $30 billion for Iraq may not be enough for the White House.

“Democrats have been unwilling to come up to the level [of Iraq funding] that’s necessary to get the administration to sign off,” Cochran said.

However, other Republicans say they are frustrated by what they dub the Democrats’ inability to complete must-pass legislation, like spending bills, a terrorist surveillance measure and tax extenders, to name a few.

“This is one big old shell game,” Sen. Richard Burr (R-N.C.) said. “The big question is, does the House finally deal with reality?”

Indeed, House-passed measures, from the energy bill to the alternative minimum tax and beyond, have proved increasingly hard for the Senate to swallow.

Despite a veto threat against the energy bill because of renewable electricity standards and a series of tax-raising provisions, House leaders sent the Senate a bill with both, and a majority of Senate Republicans successfully filibustered the bill on Friday.

Senate Majority Leader Harry Reid (D-Nev.) is now looking at striking the tax provisions, at least, and sending it back to the House. Senate Democratic leaders believe they have the 60 votes needed to beat back a filibuster on the renewable electricity standards, sources said.

Still, Republicans are seeking other changes to the energy bill. House Democrats included some changes to wage laws that are highly objectionable to the GOP, Senate Energy and Natural Resources ranking member Pete Domenici (R-N.M.) said.

Domenici said his staff and that of Chairman Jeff Bingaman (D-N.M.) would work over the weekend with the goal of possibly having a re-vote on the bill Tuesday.

As for the farm bill, Sen. John Thune (R-S.D.) said farm-state Republicans pressed Senate Minority Leader Mitch McConnell (R-Ky.) to reach a deal last week with Reid on amendments. The result was an agreement in which each party would get to offer 20 proposals.

Thune said part of the nearly monthlong impasse on the bill stemmed from the fact that Republicans had been battling with a number of fellow GOP Senators “who didn’t want a farm bill.” But Thune said Senate Agriculture ranking member Saxby Chambliss (R-Ga.) told McConnell on Thursday that the patience of Republican committee members “is starting to wear thin, and we’ve got to get an agreement.”

Thune said Reid helped facilitate the agreement by dropping his opposition to non- germane amendments. That means that some GOP proposals to the farm bill could deal with unrelated issues, such as the estate tax.

Both Democrats and Republicans said they believe the farm bill could be completed by Thursday, but that schedule could change depending on deals that may be struck on other bills.

Though the Senate passed a bill last week that would ensure millions of middle-income taxpayers would not be subject to the alternative minimum tax, the House will not likely concur and is expected to offer more amendments that will send it back to the Senate.

The House-passed AMT bill was offset by raising taxes on hedge fund managers and private equity partnerships, a proposal that was filibustered in the Senate. The Senate-passed bill does not offset the cost of the one-year AMT patch.

In the meantime, infighting among Senate Democrats continues to bring uncertainty to the fate of a terrorist surveillance bill. On Friday, Senate Intelligence Chairman Jay Rockefeller (D-W.Va.) said, “Nobody quite knows when we’re going to be doing” the Foreign Intelligence Surveillance Act revisions.

Some Democrats and most Republicans support Rockefeller’s bill because it would provide immunity to telecommunications companies that participated in the Bush administration’s warrantless wiretapping program. A rival Senate Judiciary Committee bill would not provide such immunity, and Democrats are at odds over how to structure floor debate on the two bills.

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