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Soviets, S&Ls may see $49 billion bailout as cities brace for $6.7 billion in cuts.

The House of Representatives last week defeated HR 3732, which would have removed the budget firewalls preventing savings from cuts in defense or foreign aid spending from being used for reinvestment in America. The vote was 238--187.

The defeat on the firewalls bill means that Congress and the White House will have from now until October 1st to determine how to cut domestic discretionary programs in communities by $6.7 billion from current funding levels. The city and town programs most likely to be adversely affected by the vote include: Community Development Block Grants (CDBG), housing, highways and public transportation, federally mandated Clean Water programs, rural housing and community development, Head Start, and job training.

The defeat came in the same week in which President Bush proposed a large scale, taxpayer-financed bailout package to Russia and the other former Soviet Republics, and just after the Senate voted to support the White House by increasing the federal deficit to finance $25 billion more for the S&L bailout.

President bush defended his $24 billion Russian bailout proposal saying that while he recognized that America's domestic needs are important, "the cost of doing nothing [for the Russians] could be exorbitant." The President said he was unwilling to risk such a failure and urged the Congress to act promptly on his new Russian spending package.

In response, NLC President Glenda Hood urged Congress to debate and adopt initiatives to address the economic needs of taxpayers in American communities before giving any serious consideration to a new fiscal assistance package to Russia:

"At a time of serious economic distress in our communities and concerns about our ability to compete in the global marketplace, we intend to report to our leaders--as well as the citizens and U.S. taxpayers of our communities--on the priorities of this Congress and administration."

Removing the walls, described by advocates as winning the Battle of Jericho, would have cleared the way to reinvest $4.797 billion in priority municipal programs in communities across the nation.

The House vote (to see whether your Representative voted for or against cities and towns, see accompanying list), which the Democratic leadership had put off for several weeks, came on the heels of the House bank scandal and growing concerns about the impact of defense cuts in Congressional Districts prior to next November's federal elections.

Some members who voted against the bill were quoted as saying that "inaction is easier than action."

The rejection of the bill means that up to $10 billion in defense savings could be used for deficit reduction instead of economic conversion or reinvestment. The House budget resolution provides for cutting defense spending by $10 billion below the level set under the 1990 budget agreement for next year, but the president and a number of key members on the House and Senate Armed Services Committees have indicated their strong opposition to cuts of that magnitude - leaving serious questions about whether any reduction in the deficit will occur at all

Senate Roll Call Vote No. 56 The vote is on a motion to proceed to consider and vote on S 2399, the bill to drop the walls dividing defense from domestic discretionary spending. The motion required a three-fifths vote of 60 votes to pass. An aye vote supports the NLC position, a nay vote forces cuts in domestic investment.
Adams Bumpers Gore
Akaka Burdick Graham
Baucus Byrd Hatfield
Bentsen Conrad Inouye
Biden Cranston Johnston
Bingaman Daschle Kennedy
Boren DeConcini Kerrey
Bradley Ford Kerry
Breaux Fowler Kohl
Bryan Glenn Lautenberg
Leahy Pell Sasser
Levin Pryor Simon
Metzenbaum Reid Specter
Mikulski Riegle Wellstone
Mitchell Rockefeller Wirth
Moynihan Sanford Wofford
Packwood Sarbanes
Bond Gorton Murkowski
Brown Gramm Nickles
Burns Grassley Nunn
Chafee Hatch Pressler
Coats Heflin Robb
Cochran Helms Roth
Cohen Hollings Rudman
Craig Jeffords Seymour
D'Amato Kassebaum Shelby
Danforth Kasten Simpson
Dodd Lieberman Smith
Dole Lott Stevens
Domenici Lugar Symms
Durenberger Mack Thurmond
Exon McCain Wallop
Garn McConnell Warner
Dixon Harkin

Senate Roll Call Vote No. 57

The vote is on the motion by Sen. Robert Kerry (D-Neb.) to waive the point of order against his amendment to require the S&L bailout to be put on a pay-as-you-go basis instead of financed entirely through borrowing. The motion failed. An aye vote supports the NLC position.
Adams Dodd Mikulski
Akaka Exon Moynihan
Baucus Fowler Nickles
Biden Graham Nunn
Boren Harkin Pell
Bradley Heflin Pryor
Breaux Hollings Reid
Brown Inouye Robb
Bryan Kerrey Rockefeller
Bumpers Kerry Sanford
Burdick Kohl Simon
Byrd Lautenberg Smith
Conrad Leahy Wellstone
Daschle Lieberman Wirth
DeConcini Metzenbaum Wofford
Bentsen Gore Mitchell
Bingaman Gorton Murkowski
Bond Gramm Packwood
Burns Grassley Pressler
Chafee Hatch Riegle
Coats Hatfield Roth
Cohen Helms Sarbanes
Craig Jeffords Sasser
D'Amato Johnston Seymour
Danforth Kassebaum Shelby
Dole Kasten Simpson
Domenici Lott Specter
Durenberger Lugar Stevens
Ford Mack Thurmond
Garn McCain Wallop
Glenn McConnell Warner
Cochran Kennedy Symms
Cranston Levin
Dixon Rudman
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Copyright 1992 Gale, Cengage Learning. All rights reserved.

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Title Annotation:includes related information on House and Senate voting; savings and loan associations
Author:Shafroth, Frank
Publication:Nation's Cities Weekly
Date:Apr 6, 1992
Previous Article:Democratic hopefuls hear, respond to mayors: New York City event is campaign's first urban forum.
Next Article:St. Paul helps middle class with low-interest mortgages.

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