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GOP looks to reclaim fiscal responsibility mantle

President Bush's veto of the S-CHIP bill Wednesday was the first fight over '08 spending.

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With the new fiscal year under way and no spending bills completed, President Bush and Congress are heading into a fight over fiscal responsibility that is likely to dominate politics on Capitol Hill until the end of the year.

President Bush's veto of a popular bill to provide health insurance for poor children, the S-CHIP program, on Wednesday marked a first volley.

The White House says the proposed bill is $30 billion more than what America can afford. Democrats say that the veto is a sign that Mr. Bush and Republican lawmakers who refuse to back a veto override have the wrong priorities.

"Today the president showed the nation his true priorities: $700 billion for a war in Iraq, but no health care for low-income kids," said House Democratic Caucus Chairman Rahm Emanuel (D) of Illinois, in a statement.

But the 12 pending appropriations bills for fiscal year 2008 – and a new war-funding request expected this fall – will test the credibility of both sides of the aisle.

For Republicans, battered by Bush's low approval ratings, the fall budget battles are a chance to show angry conservatives that the GOP is getting back to a concern over a restraint in spending.

"This marks the president's last chance to reassert control over the budget process that's been allowed to flail along wildly for six years now," says Pete Sepp, a vice president at the National Taxpayers Union in Alexandria, Va. "If this is an effort to reestablish credentials [with fiscal conservatives], there is a lot more reestablishment to do beyond S-CHIP. The sincerity of this effort will be judged by the number of vetoes."

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