How the President's $726 Billion Plan Was Cut in Half

By DAVID FIRESTONE

WASHINGTON, March 25 — For months, the Democrats derided President Bush's tax cut, arguing that it was unfair.
Then, as the war loomed, they argued that wartime was no time to cut taxes. But only today, after the cost of the war
became evident in lives and dollars, did they successfully turn a popular president's war against him.

In a form of political jujitsu, Democrats employed the growing unease about the war's effect on a shaky economy to reduce the
president's $726 billion tax cut proposal by half. Though sentiment against the full tax cut had been building even before the
fighting began, it seemed to crest today after Mr. Bush presented Congress with a costly war bill that represented only a first
installment.

For senators who were already inclined to oppose tax cuts, the looming costs in Iraq gave a ready-made justification.

"The uncertainty of the war, the realization that we're operating with a deficit and not a surplus, are all factors that allowed us to
pass a reduction in the size of the tax cut," said Senator John B. Breaux, Democrat of Louisiana and sponsor of the amendment
that reduced the tax cut. "This is certainly a reflection of the facts of the world that we live in today."

Democrats have had few victories against the administration since losing control of Congress in November, and their goal is to
seize the momentum. Already, today, lawmakers urged that Congress double or triple the amount that the White House has
allocated for spending on domestic security, reviving an issue that worked to their advantage before the war but seemed dormant
once the fighting began.

Senator Tom Daschle, the Democratic leader, crowed of a "great victory" today, and vowed that this was only the beginning.

"We made a very irresponsible budget a little more responsible by cutting the tax cut," Mr. Daschle said. "We're now in a
position to provide the kind of resources for deficit reduction, Social Security, Medicare and education that is so very critical."

The Democrats' exuberance may be premature. The president still gets a $350 billion tax cut, which is about $350 billion more
than many Democrats would like. And that amount may grow substantially once negotiations begin with leaders of the House,
who remain solidly behind the administration.

Even so, a blow was struck today. That it came with the assistance of three Republicans made it all the sweeter for the
Democrats, who could claim bipartisan support. Those Republicans made it clear that they agreed with the concern that cruise
missiles and tax cuts do not mix.

"I think the war has given everyone a more sober look at things than perhaps before," said Senator George V. Voinovich,
Republican of Ohio, who voted with the Democrats.

Today's vote was precisely the outcome that Democrats hoped for last week when they delayed a final vote on the budget with a
long series of amendments, betting that the president would have to request money for the war once it began. The request,
formally submitted today, included no money for rebuilding Iraq after the war, and neither did the 2004 budget under debate
today.

For many senators, approving such a budget with the full set of tax cuts was the equivalent of a family's buying a new car while
ignoring the big crack in the basement. Even Republican supporters of the full tax cut, like Senator Richard G. Lugar of Indiana,
acknowledged that a huge bill was still in the mail.

"I don't know if the supplemental we got from the administration is really going to accomplish what needs to be done in Iraq,"
Mr. Lugar said of the president's request. "I know for sure that it doesn't touch the reconstruction."

Some Republicans grumbled that Democrats had exploited the war, using it as an excuse to do something they had pushed for
earlier.

"It just goes against common sense," said Senator Lincoln Chafee, Republican of Rhode Island, who supported Mr. Breaux's
amendment and whose opposition to the tax cut had been clear for weeks. "A budget is supposed to be the blueprint for the
year, but we already know we're going to get all these enormous additions from the administration. I wish we had a more solid
view of where we're going to be financially."

The war's effect on the budget process began to emerge last week, when the Senate narrowly approved a measure to cut $100
billion from the tax cut and place it in a reserve fund in next year's budget to pay for the war and the costs of reconstruction. The
measure failed when Senator Russell D. Feingold, Democrat of Wisconsin, first offered it in the budget committee, but it gained a
majority in the full Senate after the war began.

"People were starting to get sensitive about the budget not being honest about the war," Mr. Feingold said today. "And
Republicans were under a lot of pressure to acknowledge that the tax cut runs at cross-purposes with fighting this war. At every
step of the fighting, it became more painfully obvious."

Republicans are hoping that at least one of their three members who voted today to reduce the president's proposed tax cut —
particularly Senator Olympia J. Snowe of Maine — will change his or her vote. But Ms. Snowe seemed adamant about her
vote, and issued a statement about "the dark shadows" cast over the economy and the tax cuts by global events. Democrats say
they now hope that those shadows will extend over the full range of the administration's domestic agenda.