The American Spectator

Washington Prowler

p> THE SPOILER FROM WAYS AND MEANS br> Senate Majority Leader Bill Frist and Speaker of the House Dennis Hastert , despite the wishes of some hardline conservatives, have apparently patched things up. The two men have not yet met, but they've conversed since Frist's return from China, as have their staffs. "We're all on the same page," says a Senate leadership staffer. /p>

The same cannot be said for House Ways and Means Committee Chairman Bill Thomas. It appears that when everything is said and done, Frist and Hastert -- working with the White House -- will be able to raise the tax cut to more than $500 billion. But Thomas, who continues to harbor resentment over perceived slights by the Bush administration, is attempting to take the reexamination of the tax cut plan to further his own policy agendas. Tops on his list: cutting dividend taxation more than the Bush plan would.

"We think we can get the basic tax cut closer to where we want it to be," says a House leadership staffer. "But Thomas was not part of the conversations with the White House, and now he's trying to muck things up more than they already are."

It's a certainty that Republicans in the Senate who are already opposed to a tax cut greater than $350 billion would further balk at a plan that included more tinkering with the tax code. As it stands, Bush and the Senate will have to find at least $100 billion in offsetting savings to allow for the $100-$200 billion increase in the tax cut currently on the table.

p> GUNNING FOR SACRAMENTO br> Sen. Dianne Feinstein

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