Clinton refuses to toe Congress line

The measure, passed by the Republican-led Congress, went into effect on January 1. Like the traditional veto, the President’s line-item veto can be over-ridden by a two-thirds majority of both Houses of Congress.

Clinton, a Democrat, cut a provision that would have allowed a small group of banks and financial institutions not to pay taxes on income earned outside the US.

Another stricken measure would have exempted a Texas businessman, Harold Simmons — who happens to be a big donor to the Republican Party — from paying capital gains taxes on the sale of an agri-business cooperative linked to a sugar-beet refinery.

The White House said the final vetoed provision would have allowed New York state to pass on the federal Government part of the payments it must make as part of the Medicaid Health Care Programme that helps the poor.

Clinton’s actions were largely symbolic; the total savings from using the President’s new power total only $ 615 million over five years.

The White House said the purpose of the veto was to show the public that the President would not allow their tax money to be wasted to benefit narrow interests.

“The actions I take today…will send a signal that the Washington rules have changed for good, and for the good of the American people,” Clinton said before signing the veto.Knowing the President would think twice about vetoing a budget he largely favoured, lawmakers would often slip special provisions benefiting their constituents into spending Bills.

The Republicans, who passed the Bill last year, included the line-item veto in their “Contract with America” programme.

Entourage to shrink

The traveling entourage for the President and First Lady will shrink in size because of budget problems, the White House has said.“The President and First Lady have both expressed concern about the volume of people — not official folks from military or secret service or medical unit people that are required by law to travel with the President but more White House aide/staff type folks,” spokesman said.