Bush Calls for Cuts to Offset Relief Plan

Bush said he still intended to spend whatever it took to finance the massive Gulf Coast rebuilding effort he outlined in Thursday night's address to the nation. White House officials acknowledged that the government would cover most costs in the short term by running up the federal debt.

The president ruled out tax increases to reduce red ink. He said the Office of Management and Budget would help lawmakers trim federal programs to help offset reconstruction costs that independent analysts predicted would exceed $200 billion.

"You bet it's going to cost money," Bush said at a White House news conference.

"The key question is to make sure the costs are wisely spent and that we work with Congress to make sure we are able to manage our budget in a wise way," he said. "And that's going to mean cutting other programs."

GOP lawmakers and conservative activists had been expressing misgivings about what they perceived as an open-ended federal commitment to borrow and spend to rebuild New Orleans and nearby coastal communities in Louisiana, Mississippi and Alabama.

"This isn't the first time an American city has been devastated," said former Rep. Pat Toomey (R-Pa.), who heads the economically conservative Club for Growth. "We've had great disasters, and the federal government didn't always come in and rebuild these cities. We shouldn't assume the only way to do this is through Uncle Sam."

Rep. Shelley Moore Capito (R-W.Va.) expressed concern about the potential for waste in Bush's reconstruction plan. "We don't want to turn rebuilding the Big Easy into the Big Dig," she said, referring to Boston's costly underground-highway project.

Rebuilding after Katrina, Capito said, "is going to require efficiency, which is not something synonymous with the federal government."

The debate reflected a schism among conservatives pitting advocates of a limited federal government against supporters of a more expansive GOP agenda.

The president's reconstruction proposal -- expected to cost roughly twice as much as the post-World War II Marshall Plan to rebuild Europe -- intensified the anxiety of fiscal conservatives who already deplored the rapid increase in deficit spending under Bush.