Bush takes tax plan on the road to gain support

By Alex Kingsbury
U-WIRE Washington Bureau
March 5, 2001

President George W. Bush sent his $1.6 trillion budget to Congress last Wednesday and set out on the road to drum up public support for his new economic vision of the United States.

The president visited Pittsburgh before heading to Omaha, Neb., Little Rock, Ark., and Atlanta on the two-day tour intended to generate public support for his economic plan.

President Bush called for a budget that is “active but limited, engaged but not overbearing.”

Not mentioned in the president’s nationally televised address were budget proposals to axe funding to popular programs in 10 federal agencies, including farming aid and the Department of Transportation and Interior.

“A budget’s impact is counted in dollars, but measured in lives,” said Bush to a joint session of Congress last Tuesday evening. “Excellent schools, quality health care, a secure retirement, a cleaner environment, a stronger defense — these are all important needs, and we fund them. The highest percentage increase in our budget should go to our children’s education.”

The budget blueprint unveiled Wednesday includes the administration’s 10-year plan calling for the projected $5.6 trillion surplus to be allocated in three areas — $2.6 to strengthen Social Security; $1.6 trillion for tax cuts and $1.4 trillion for an auxiliary fund, also to be used to pay down the national debt. Also included in the president’s budget is $2 trillion of a projected $5.6 trillion surplus over the next 10 years allocated to reducing the $3.2 trillion publicly held debt. Bush hopes to make the tax cut retroactive to Jan. 1.

“The American people clearly favor a balanced approach to reducing taxes, where the size of the tax cut isn’t so large that it keeps us from investing in the priorities of our families,” said Senate Minority Leader Tom Daschle, (D-S.D.). “As we begin the debate over use of the surplus, we should be guided by the common sense of Americans who want fiscal prudence and sound investments as well as a tax cut.”

Echoing his campaign promises, Bush’s budget calls for increased spending in education, drug enforcement, medical research and prescription drug benefits for the elderly poor.

The president’s budget reflects a reaction to the U.S. economic slowdown in recent months. Last Wednesday, the Commerce Department released a report saying that the economy grew at an annual rate of 1.1 percent in the final three months of 2000, marking the weakest performance in more than five years.

Federal Reserve Chairman Allen Greenspan said the same day that the economic slowdown that has been plaguing the U.S. in recent months “has yet to run its full course.”

Speaking in Pennsylvania, Bush said that Greenspan’s concerns were “all the more reason to accelerate the tax cut … as soon as possible.”

In the Democratic response to the president’s address House Minority Leader Dick Gephardt (D-Mo.) and Senate Minority Leader Daschle said the president’s tax cut was dangerously large.

“We want a different kind (of tax cut). A tax cut that is part of a responsible budget, that lets us pay off the debt, and invest in America’s future. One that is fair to all Americans. President Bush’s plan doesn’t do those things,” the Democratic leaders said in their response.

Sen. Joseph Lieberman (D-Conn.) called the president’s tax cut, “the wrong medicine.”

“But the trouble with the president’s plan is not just a matter of numbers,” Lieberman said. “Bush’s tax cut threatens our prosperity.”

Bush may face problems if he is unable to convince Congress to reduce spending. In 1981 President Ronald Reagan won widespread support for his tax cut, yet failed to convince the Democratic Congress to pass suitable funding cuts. This contributed to nearly two decades of federal deficit, something some members of Congress fear could happen again.

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