Democrats Call Bush Tax Plan 'Hogwash'

Monday, 12 May 2003 04:30 by: Anonymous

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  Dems Call Bush Tax Plan 'Hogwash'

  Sunday 11 May 2003

  Treasury Secretary John Snow, promoting the administration's tax 0aplan ahead of Monday's Senate debate, called it the right fix for "a soggy 0aeconomy."

  "Hogwash," countered Senate Democrats, who say any benefits from 0athe tax cuts will not help most people.

  The debate played out on the Sunday talk shows while President 0aBush got ready to hit the road this week to campaign in three states for the 0aproposal.

  "A soggy economy is what we've got today. We're in a recovery but 0ait's not as strong and robust as it should be," Snow said in a broadcast 0ainterview. "That's why the president's pushing this jobs and growth plan."

  Democrats worried that more tax cuts would send the federal 0agovernment further into debt. The Bush plan, they said, would aid the rich but 0afail to "trickle down" to low- and middle-class Americans.

  Sen. Mary Landrieu, D-La., said plans to revive the economy 0aneeded to go another way. "I think this whole 'trickle-down' is hogwash," she 0asaid. "We in the Senate, Democrats and some Republicans, are going to do what we 0acan to get him to adjust his direction."

  The Senate on Monday was to begin debate on a GOP-backed $350 0abillion tax cut proposal, which is less than half of what Mr. Bush had sought. 0aSeveral Republicans see that bill as a starting point, although many Democrats 0asupport no more than $150 billion in tax relief.

  Snow's appearances were part of the administration's effort to 0apromote the president's plan and win congressional approval.

  Mr. Bush planned to meet with small-business owners in 0aAlbuquerque, N.M., on Monday, before heading to Omaha, Neb., to spend time at 0athe Airlite Plastics plant.

  On Tuesday, he will talk to senior citizens in Indianapolis and 0agive another speech on his economic-stimulus plan.

  The GOP-run House on Friday approved a $550 billion version of 0athe bill that would trim levies on wages, capital gains and some business 0ainvestments. It would give the president a smaller reduction than he wanted on 0acorporate dividend taxes.

  "I hope it's closer to $550 billion than $350 billion," Snow told 0ain another televised interview. "Wherever we come out, I think we are going to 0ahave major tax relief for American taxpayers and tax relief that we will create 0ajobs."

  Any more tax cuts, or an increase in spending, would likely put 0athe U.S. government deeper into debt, which is at about $6.4 trillion an 0aaverage of $70,000 per family. By current law, the debt cannot exceed $6.4 0atrillion, so Congress must vote to raise it.

  Senate Democratic Leader Tom Daschle said lawmakers had no choice 0abut to do so, but hoped Congress would vote on that measure before tackling tax 0acuts.

  "So there's no doubt that deficit and debts are matters, are 0afunctions of the economy, are matters of fiscal policy that have to be dealt 0awith," said Daschle, D-S.D. "This administration's ignored them from the 0abeginning."

  The soaring debt was the result of years of spending increases 0aand past tax cuts, Snow said.

  But the Treasury chief called the deficit more manageable than in 0aprevious years, and understandable given job losses and an economy performing "far short of its potential." Meanwhile, deficits and debt rising during a good 0aeconomy, such as during the mid-1990s, are more troublesome.

  He said consumer spending has been "pretty good" and low interest 0arates were helpful, but business spending has been hampered by the decline of 0athe stock market, corporate accounting scandals, and the aftermath of the Sept. 0a11 attacks.

  "But most importantly, we need to get the business sector 0aspending, and small business," Snow said on "Fox News Sunday."

  The Senate bill includes $20 billion in aid for state and local 0agovernments, many of which are raising taxes and facing massive budget cuts. 0aWhile the Bush proposal does not include direct aid for the states, Snow said 0athey would still benefit.

  The Bush plan is not a "real stimulus plan," said Democratic Gov. 0aEd Rendell of Pennsylvania. He has proposed increasing his state's income tax 0aand legalizing slot machines at racetracks to finance reductions in local 0aproperty taxes and increased school subsidies.

  "We need to stimulate our economy, pump money into creating new 0aroads, new railroads, fixing up our airports," he said. "Those things create 0ajobs, do good, and help American business."

  New York City Mayor Michael Bloomberg, a Republican, said federal 0atax cuts would help a city with a projected $3.8 billion budget deficit. State 0aand city lawmakers have approved a wide array of measures to close the gap, 0aincluding an increase in the sales tax and water rates.

  "But if the federal government reduces taxes, then that will ease 0athe burden on states and cities who are being forced to raise their taxes simply 0abecause they have services that they are either unwilling or unable to cut," he 0asaid.

Last modified on Monday, 21 April 2008 13:39