Bush Signs Debt-Limit Hike

President Bush signed legislation on Friday raising the government's debt limit by $800 billion and clearing the way for Congress to send him an overdue $388 billion spending bill to finance most federal agencies.

The new federal borrowing cap is $8.18 trillion; that's 70 percent the size of the entire U.S. economy, and more than $2.4 trillion higher than the debt Mr. Bush inherited upon taking office in 2001.

The House approved the debt-limit measure Thursday by a near party line 208-204 vote. Its passage was not in doubt because the alternative was a jarring federal default, but it was nonetheless a battlefield for partisan fingerpointing.

Meanwhile, White House and bipartisan congressional bargainers moved to the verge of agreement on the year-end spending package expected to total $388 billion.

The giant spending measure, which leaders hoped to pass by Saturday, bears extra money for priorities like veterans, the wartorn Darfur region of Sudan, biohazard detection equipment for the post office, and likely thousands of projects for lawmakers' home districts.

The legislation was largely defined by Mr. Bush's demands for curbs on domestic spending, with only modest increases for favorites like education and cuts for some of the president's own initiatives.

"Everybody took hits," said House Appropriations Committee Chairman Bill Young, R-Fla., a chief author of the measure. "There will be members who aren't totally satisfied, but we we're committed to stay within the budget number."

Young said the bill would have been $20 billion larger had he accommodated all of his colleagues' requests for more projects.

Late problems included staunch White House opposition to an effort by some legislators to curb Mr. Bush's plan to contract out federal jobs to private businesses, as well as a plan to pay for some of the bill's increases by cutting unspent defense funds.

Democrats said GOP tax cuts were the problem and that the measure should have been accompanied by a revival of a requirement that the budget be cut to pay for any tax cuts or spending increases.

"I understand there's been an election, I understand you won and I commend you for it," said Rep. Charles Stenholm, D-Texas, who was defeated last month after a 26-year career as one his party's most stalwart deficit hawks. "But that also means you have the responsibility for your actions" because the GOP controls the White House and Capitol Hill, he said.

Republicans said Democratic cries for fiscal responsibility contrasted with their frequent calls for higher spending.

"There's nothing like a reformed lady of the evening," said Rep. Dan Burton, R-Ind.

In a written statement aimed at reassuring the financial markets that federal borrowing would be unimpeded, the White House said Mr. Bush would sign the legislation by Monday.

"The president commends the Congress for passing the debt limit increase. Passage of this legislation was important to protect the full faith and credit of the United States," the statement said.

The spending bill contains $14.8 billion for programs for low-income students, 2.5 percent more than last year. Biomedical research by the National Institutes of Health would grow 2 percent to $28.4 billion, well below the robust boosts it won in recent years.

Veterans' health care would grow to $30.3 billion, $1.9 billion over last year but less than veterans groups wanted. Aid for refugees in Sudan would be $404 million. A plan to draw $93 million of the Sudan aid from a slow-spending fund for rebuilding Iraq was dropped in deference to administration demands.

But the bill would cut grants for local water improvements and research supported by the National Science Foundation, and hold the federal subsidy for Amtrak to $1.2 billion, the same as this year.

Ending one lingering dispute, lawmakers agreed to $577 million, the same as last year, to continue developing a nuclear waste storage site at Yucca Mountain in Nevada, one lawmaker said.

Spending-bill bargainers also sorted through a stack of policy changes that lawmakers and lobbyists were trying to shove into one of the last measures Congress will approve this year.

Congressional aides said they believed a milk subsidy extension sought by Midwesterners and an effort to repeal required country-of-origin labels for meat would not make the final bill. Also thwarted was a drive to ease rules designed to protect endangered species from pesticides, the aides said.

The spending measure, covering the government budget year that started Oct. 1, is an amalgamation of nine separate bills financing all federal agencies except the Pentagon and the Homeland Security Department.