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WASHINGTON — Vice President Dick Cheney fulfilled one of his Constitutional duties Wednesday, breaking a 50-50 tie in the Senate to pass a budget-reduction package that repeals the Byrd Amendment and does away with a cotton-subsidy program.

The bill has to be approved again by the House, which passed the measure 212 to 206 on Monday, because the Senate removed a few small health care-related provisions. It is unclear if the House will take up the bill again before the New Year.

Both the Byrd Amendment and the cotton-subsidy program were found to violate World Trade Organization rules. The Byrd Amendment, which is set to be phased out by Oct. 1, 2007, compensates U.S. companies hurt by undervalued and subsidized imports. During the last five years, $1 billion has been doled out based on the provision.

Importers supported the repeal of the amendment, arguing that it raised consumer prices by promoting additional unfair-trade cases. Textile groups were on the other side of the debate and maintained that the Byrd Amendment protected U.S. firms.

Also folded into the almost $40 billion package of spending cuts was the elimination of the so-called Step 2 cotton-subsidy program as of Aug. 1. It supported cotton farmers, textile mills and exporters to the tune of $2.4 billion between 1995 and 2004, according to the Environmental Working Group.

This story first appeared in the December 22, 2005 issue of WWD.  Subscribe Today.