Threat of Bush veto kept Congress wary

They didn't end the Iraq war or tackle $4-a-gallon gas.

But Democrats running Congress created programs this year to educate veterans and feed and house the poor. Democrats also cut deals with the president to send voters some economic help.

Their election-year strategy was to exact a steep price from President Bush for letting him have his way in some fights, while teaming with Republicans — some nervous about re-election — to defy him on other fronts.

The time for bargains is all but over.

When Congress returns in September from its five-week break, a few routine chores will dominate the agenda: renewing some tax breaks and passing a bill to keep agencies on automatic pilot until there's a new president. A second economic aid bill is a possibility; more partisan wrangling over what to do about gas prices a certainty.

House Speaker Nancy Pelosi, D-Calif., called Congress' failure to bring troops home from Iraq “probably my biggest disappointment” of the year.

Bush won $162 billion in war money — without any restrictions — well into 2009; his term ends in January. He also got expanded powers for intelligence agencies to eavesdrop, without warrants, on suspected terrorists.

Still, Pelosi said, with the help of Republican defectors and fierce negotiating with Bush, “we did find some areas where, although he initially resisted, he came around.”

That was true of an economic relief measure developed quickly by Pelosi, House Republican leader John Boehner of Ohio and Treasury Secretary Henry Paulson that sent rebates of $600 to $1,200 to most wage-earners. The checks are widely credited for having a positive effect on the economy.

The $168 billion in economic aid was in essence a tax cut that omitted many of the Democrats' priorities, including jobless benefits and heating and food aid for the poor. But it did fulfill the Democrats' goal of sending checks to low-income people.

When it came time to pass Bush's war spending measure, Democrats insisted on the jobless aid, plus a $63 billion, 10-year GI Bill, more than doubling the college aid for troops and veterans.

Bush also strongly resisted Democrats' foreclosure rescue plan. But with foreclosures soaring and markets terrified about the financial health of the big mortgage companies Fannie Mae and Freddie Mac, he relented in exchange for the power to rescue them and tighten oversight.

The resulting compromise is projected to help 400,000 homeowners avoid foreclosures beginning on Oct. 1. In the bargain, Bush had to swallow some $4 billion in grants for devastated neighborhoods and a new affordable housing fund financed by the companies, which Democrats long had sought.

Bush showed that even an unpopular, lame-duck president still has sway on national security issues, plus the negotiating leverage that comes with the power to veto legislation.

“In the eighth year of the presidency and in this environment, Bush's veto was pretty strong,” said Candi Wolff, his former top legislative aide.

The prospect of losing veto showdowns with Bush limited the Democrats' ability to win as much domestic spending as they wanted and stopped them from restricting his ability to wage war or spy on suspected terrorists.

Partisan gridlock over energy blocked any relief on gas prices. Renewing Bush's No Child Left Behind education law fell victim to disputes over money and flexibility.

For now, Bush is not even going near the idea of another economic aid package. “Talking about a second stimulus package right now is premature,” said Dana Perino, the White House press secretary.

Democrats plan to advance a bill this fall that could include more public works spending, doubling home heating and air-conditioning subsides for the poor, increasing food stamps, and providing more aid to states.