Bush to Back Off Some Initiatives for Budget Plan
By ROBERT PEAR and EDMUND L. ANDREWS

WASHINGTON, Jan. 31 — President Bush will propose a $2.3 trillion budget on Monday that backs away from some of the major spending and tax initiatives he supported in prior years, administration officials say.

Constrained by big budget deficits and political realities, the officials said they would retreat on some of their own ideas and oppose others favored by Republicans in Congress.

Mr. Bush will try instead to lock in some of his prior victories, by pressing Congress for a permanent extension of most of the tax cuts adopted in the last three years that were set to expire over the next seven years. He says the tax cuts foster economic growth, which helps create jobs. But many Democrats say the tax cuts are fiscally reckless and widen the gap between rich and poor.

…Under fire from Republicans alarmed at the growth of the federal budget in recent years, Mr. Bush called Saturday for new statutory limits on spending.

"To assure that Congress observes spending discipline, now and in the future, I propose making spending limits the law," Mr. Bush said in his weekly radio address. "This simple step would mean that every additional dollar the Congress wants to spend in excess of spending limits must be matched by a dollar in spending cuts elsewhere."

Mr. Bush did not say who would set the limits or how they would be enforced. Unlike similar rules that governed Congress in the 1990's, Mr. Bush's proposal would not impose restrictions on new tax cuts.

While Congress has often exceeded Mr. Bush's spending requests, fiscal conservatives have complained that he has never vetoed a spending bill.

Mr. Bush boasted that he would virtually freeze many domestic programs, with an increase of less than 1 percent for domestic discretionary spending outside of military and homeland security.

But he is proposing an increase of 7 percent for the military, including 13 percent more for missile defense systems; an increase of nearly 10 percent for heightened security against terrorist attacks; and an increase of 11 percent for the Federal Bureau of Investigation.

Those increases and Mr. Bush's determination to make his tax cuts permanent will limit his maneuvering room in other areas.