Bush Holds Out on SCHIP

Source from:  worldtobacco.co.uk 08 November 2007 11/09/2007

The US Congress and President George Bush remained at an impasse at the beginning of November over a proposed law that would vastly increase the number of poor children who would be eligible for federal health insurance. It would at the same time substantially increase the federal excise tax on tobacco products. In October, both chambers of the American Congress had passed a form of this legislation, which was aimed at re-authorizing an existing program called SCHIP (State Children's Health Insurance Program). But the president vetoed it, and Congress was unable to achieve the two thirds majority needed to override the veto. After considerable compromise, the Congressional leadership drafted a revised version of the legislation, and it was passed by both Houses by November 1. But the President was not assuaged, saying the second bill was no more acceptable than the first one. "If Congress sends this bill back to me, I'm going to veto it again," he said before the Senate vote. At this writing, he had not formally vetoed the legislation, but that step was considered imminent. The likelihood of override seemed remote: In US history through 2004, only 106 of 1,484 regular presidential vetoes have ever been overridden by Congress. The US tobacco industry no doubt will cheer mightily if the President's veto is sustained. An analyst for the Wall Street firm J.P. Morgan predicted that the volume of tobacco product sales would have declined 5% to 6% if the first proposal had gone into effect, since it would have increased retail product prices approximately 15%. The second proposal was not measurably less draconian. Bush ensured the permanent affections of everyone involved in tobacco when he revealed that he would veto any measure that would raise tobacco taxes. But this probably reflected only his opposition to new taxes on anything. "Federal revenues are at an all-time high, and no tax increase of any kind is needed to finance S-CHIP reauthorization," a White House position statement said. He also objected to parts of the bill which would: --allow individual states to avoid covering poor children first, --subsidize middle class families and --allows federal funds to be used for coverage of ineligible individuals by which the president clearly meant illegal aliens. Enditem