Gingrich loses grip on budget revolt

As President Bill Clinton and his opponents struggle to find a formula to restart budget negotiations, the row has brought home one truth about this Congress - that the Speaker, Newt Gingrich, leader of the Republican revolution on Capitol Hill, can no longer control his most fervent revolutionaries.

Despite much to-ing and fro-ing along Pennsylvania Avenue yesterday, the deadlock seemed intact, meaning 260,000 federal workers have no idea when this second partial government shutdown in six weeks will end.

One thing is certain: they will only return to work with the acquiescence of the 70-odd first term, or freshmen, Republicans who rode to Washington on the crest of the wave which gave the party control of the House of Representatives for the first time in 40 years.

Since then, this group, accounting for almost a third of Republican strength in the House and ideologically committed to rolling back government, cutting taxes and eliminating the deficit, has been a force sustaining Mr Gingrich.

But now, as the Speaker edges towards compromise, the newcomers, whom Democrats sarcastically describe as the "Magnificent 70", are digging in their heels, adamant they will give no ground to a White House which they accuse of backtracking on every promise.

It was the freshmen who demolished the fragile understanding brought back by Mr Gingrich and Bob Dole, the Senate majority leader, from their meeting with Mr Clinton on Tuesday, insisting they would not vote for any stop-gap spending measure allowing government to re-open until a deal to balance the budget within seven years was signed and sealed.

Afterwards, a rattled Mr Gingrich played down the rebellion in his ranks. But the revolution is devouring its children. The purist newcomers are almost as suspicious of their erstwhile inspiration as they are of Mr Clinton. The prime beneficiary is the President, revelling in another opportunity to paint the Republicans as zealots, and to blame the breakdown on "extremists" who had become "the tail which wagged the dog".

Yesterday the political warfare grew even more tangled as Mr Clinton announced he would veto a Republican welfare reform bill, and the House for the first time overrode a presidential veto of a bill reforming product liability, while the White House and Congress inched towards a compromise that would keep their battle over Whitewater documents out of the federal courts.

But the budget remains the key, with prospects of a deal before the New Year diminishing every day. If an agreement emerges, it will almost certainly not be based on the hardline plan of the Republicans or the vague formulas of the White House, but on a compromise worked out by frustrated moderates in both parties.

One of these, elaborated by a bipartisan group of senators, would sharply reduce the seven-year $245bn (pounds 160bn) tax cut on which the Republican intake of 1994 is so bent. Another plan, from conservative Democrats in the House, would eliminate the cut entirely, in return for smaller reductions in the Medicare and Medicaid federal health schemes.

It is possible a bipartisan majority in both Senate and House could be put together around these schemes. That would bypass the hardliners. But it would lay bare the Republican split and deprive Mr Gingrich of much of his power base. "Why would I do anything to my freshmen?" he asked after Wednesday's insurrection. "They made us a majority."