Clicking on banner ads enables JWR to constantly improve
Jewish World Review March 29, 2001 / 5 Nissan 5761

Morton Kondracke

JWR's Pundits
World Editorial
Cartoon Showcase

Mallard Fillmore

Michael Barone
Mona Charen
Linda Chavez
Ann Coulter
Greg Crosby
Larry Elder
Don Feder
Suzanne Fields
James Glassman
Paul Greenberg
Bob Greene
Betsy Hart
Nat Hentoff
David Horowitz
Marianne Jennings
Michael Kelly
Ch. Krauthammer
Lawrence Kudlow
Dr. Laura
John Leo
David Limbaugh
Michelle Malkin
Jackie Mason
Chris Matthews
Michael Medved
Kathleen Parker
Wes Pruden
Sam Schulman
Roger Simon
Tony Snow
Thomas Sowell
Cal Thomas
Jonathan S. Tobin
Ben Wattenberg
George Will
Bruce Williams
Walter Williams
Mort Zuckerman

Consumer Reports

As Economy Wilts, Is Bush Too Passive On Early Tax Cuts? -- IN THE END, of course, all that counts is whether the economy recovers quickly and strongly. If it does, President Bush will get the credit. If not, he'll get the blame.

Still, in the short run he's being judged on how he responds to the current bear economy and stock market, and the tag being planted on him is "passive."

Despite a plunging stock market and weak economy, until late last week Bush seemed curiously unwilling to alter his $1.6 trillion tax-cut plan or even to argue for it on the basis that it would get the economy moving again.

Finally, the White House quietly indicated that it supported - and may have helped fashion - Senate Budget Chairman Pete Domenici's (R-N.M.) proposal to return $60 billion of this year's $93 billion surplus to taxpayers.

White House aides issued a statement that Bush "believes we need to get more money into people's hands quicker, and he's committed to working with Congress to look for ways to make the tax cut retroactive" to hasten economic recovery.

Nevertheless, the President himself has not been out in front calling for action to end what surely will be dubbed "the Bush recession," even if it more justly should be named after Federal Reserve Chairman Alan Greenspan.

Up to now Bush has allowed Democrats such as Sens. Thomas Daschle (S.D.) and Kent Conrad (N.D.) to steal the march on him, recommending "smaller, fairer and faster" tax cuts designed to put money into the hands of middle-income people who will spend it.

Daschle and Conrad called for immediate enactment of a cut in the lowest tax rate from 15 to 10 percent - a $60 billion proposal that would give about $600 to every family this year.

Sens. Bob Graham (D-Fla.) and Jon Corzine (D-N.J.) recommended a plan that would apply the 10 percent rate to an individual's first $7,500 in income or a couple's first $19,000, which would give couples $950 each at a cost of $80 billion this year.

Still another Democratic plan, being crafted by Sen. Max Baucus (Mont.) with the assistance of former Treasury Secretary Robert Rubin, would cut tax rates by $200 billion over the next three years.

That's double the amount offered during that period under the House-passed version of Bush's rate-cut bill, which will cut taxes by $950 billion over a decade, but offers most of its breaks in later years.

The House GOP rate-cut bill provides a reduction of only $5.6 billion this year, and Bush's budget calls for no cuts until next year, when they would total just $30.6 billion.

Other Republicans have been arguing for tax cuts that are bigger and faster than either the Democrats' or Bush's, but so far they have no official standing.

One proposal, costing $45 billion this year, would put all of Bush's proposed rate cuts into effect immediately. But that would swell the total long-range cost of his tax package to several times the $1.6 trillion over five years.

Bush may support a speedup of tax cuts, but he seems determined to stick to $1.6 trillion as its 10-year total cost.

There may be a method to Bush's quiet approach. If both Democrats and Republicans rally around a speedup, he may get a policy through consensus without putting his brand on it and arousing partisan passions.

Conrad's reaction to Domenici's rebate proposal, for instance, was: "We're glad to see them moving in our direction."

Meantime, Republicans on the House Ways and Means panel passed an increase in the per-child tax deduction skewed more toward lower-income families than Bush's - possibly a hint that the GOP sees a need to make its cuts "fairer."

Major differences remain, though, on estate taxes, whose total elimination (favored by Republicans) would benefit the wealthy.

One possible compromise is to stop taxing assets, property, businesses and farms on the death of the owner, but rather when the asset is sold, and then at a capital-gains rate of 20 percent instead of the current top inheritance rate of 55 percent.

Democrats continue to insist that Bush's tax cuts will end up totaling around $2.5 trillion and will consume the entire non-Social Security budget surplus, which they say may shrink if the economy stays soft.

Moderates of both parties have recommended inserting a trigger into Bush's tax package so new cuts or spending couldn't take effect unless surplus targets were met.

Baucus' plan takes a different approach: Congress would enact tax cuts only for three years and revisit fiscal policy on the basis of projections available then. Republicans are unlikely to agree to this, though.

How much flexibility will Bush show on the size and distribution of tax cuts? He isn't saying. That could be seen as passivity or the kind of leadership that lets Congress play a role in policymaking.

JWR contributor Morton Kondracke is executive editor of Roll Call, the newspaper of Capitol Hill. Send your comments by clicking here.


03/27/01: Ex-Clinton Adviser Thinks Bush Needs More Upbeat 'Vision'
03/16/01: Cultural indicators improved during Clinton years. Why?
03/13/01: Nice talk aside, Bush team wants to win above all
03/08/01: Tax fight turns back to question of what's 'fair'
03/06/01: Bush and Congress should prepare for lean years
03/01/01: Bush needs group to promote ideas in Black America
02/26/01: Bush should talk about long-term budget challenges
02/22/01: AARP's agenda at odds with Bush priorities
02/20/01: When will Dems finally say Clinton is unfit leader?
02/14/01: McCain won't run against Bush again, just differ on issues
02/12/01: Is Joe Lieberman tilting left toward 2004?
02/07/01: The controversy starts: Bush orders HHS study of fetal, stem cell issues
02/05/01: Dems move toward bush on taxes, but ...
02/01/01: Bush should be open with press
01/30/01: Bush Should go for broke early on education
01/23/01: Clinton ain't going away, folks
01/19/01: Bush should try for legacy as 'Great Reconciler'
01/16/01: Left-Center Rift Re-emerges For Democratic Leaders
01/12/01: Clinton doing Bush no favors in Mideast
01/09/01: Bush and Democrats can deal
12/14/00: Will Daschle make it his business to get along with President Bush?
12/08/00: GOP is in danger of ruining record on medical research
11/27/00: Some fascinating stories about how and why people voted
11/22/00: GOP Survived health bullets, but one is left
11/20/00: Can next president and Hill deal?
11/15/00: With nation split, leaders must reach across party divide
11/07/00: The Envelope, Please:Bush Beats Gore, GOP Holds Hill
11/03/00: Parties appeal to two 'gospels'
11/01/00: Lurking in the shadows
10/26/00: What's Gore's Social Security plan?
10/18/00: While Bush, Gore debate surplus, Congress spends it
10/16/00: Two debates leave lots of questions
10/03/00: What questions should be debated?
09/28/00: Gore and Bush should prepare to lead
09/19/00: Bush let values issue slip away
08/25/00: Gore hands center to Bush
08/22/00: AlGore, look to future, not to Bubba
08/08/00: 2000 race could leave high road for low
08/03/00: Convention must point Bush to center
08/01/00: GOP Readies 'Debt Lockbox' As 2000 Strategy
07/27/00: Cheney adds heft to GOP ticket
07/25/00: Foreign, Defense Policy Deserves Full 2000 Debate
07/20/00: Truman Show: Gore Replays 1948, But Bush Isn't Dewey
07/18/00: Bush Must Fight Gore's Drug Plan As 'Bad Medicine'
07/13/00: Mexico's Election Supports U.S. Action On NAFTA, Bailout
07/10/00: Abortion is good for something --- just ask AlGore
07/06/00: Meet Steve Ricchetti, Bubba's secret weapon
06/30/00: AlGore is down, but is he out?
06/27/00: Social programs caught in election-year game of one-up
06/22/00: Congress Is Near Flunking a Test On School Reform
06/16/00: Doting on the grandparents
06/13/00: On Stem Cells, Bush Has Wrong Pro-Life Stance
06/08/00: Has Gore Caught Bush?
05/26/00: PNTR Vote Could Tell Which Party Fits 'New Economy'
05/23/00: The secret to winning the election: Economic programs
05/18/00: Gore should regroup
05/16/00: McCain's Support Is Tepid, But Lets Bush Focus on Gore
05/11/00: Voters need wonk training
05/09/00: Bush Could Score With Charge That Gore's Too Partisan
04/28/00: Reno's force aids Clinton, not Elian
04/25/00: Should Clinton be indicted?
04/24/00: Can Gore win on Bush tax cuts?
04/18/00: Levin's 'bridge' key to China trade?
04/11/00: Congress, U.S. Voters Still Aren't Ready For Campaign Reform
04/06/00: Bush, Gore Silent As Popular Culture Gets Ever Coarser
03/30/00: Is 2000 Like 1948, 1976 or 1960? Or Is This Unparalleled?
03/28/00: Will Bush, Gore Go for a Better Way To Pick Nominees?
03/23/00: Medicare cutbacks bleed hospitals
03/20/00: Chances Improve That China Trade Will Pass Congress
03/16/00: Lieberman as veep would help Gore
03/14/00: Can Bush, McCain Unite to Beat Gore?
03/09/00: Can GOP Forge Unity After Nasty McCain-Bush Race?
03/07/00: What accounts for McCain's excesses?
03/02/00: 'Debate' Proved Gore Is This Year's Best Gut-Fighter
02/29/00: Surprises! The 2000 GOP race is full of it
02/25/00: Voters want centrist in White House
02/23/00: Gore would hit McCain's record
02/15/00: Will negativity hurt McCain in S.C.?
02/10/00: How hard should Bush hit McCain?
02/08/00: Bush must retool his entire campaign
01/27/00: Could Gore beat Bush as Truman beat Dewey?
01/20/00: Big New Surplus Estimates Could Alter 2000 Politics
12/21/99: Bush improves, everyone panders
12/16/99: Prospects improve for campaign reform
12/14/99: Riots raise free trade as 2000 issue
12/10/99: Gore won GOP 'debate' in N.H.
12/07/99: Election pits Bush cuts vs. Medicare boost
12/03/99: Can race be a constructive issue in 2000?
11/19/99: White House race may be best in decades
11/16/99: Where is Bush on health care fight?
11/11/99: Will TV stop profiteering from politics?
11/09/99: Is GOP isolationist, or just partisan?
11/04/99: Gore, Bradley Run Opposite Races On Style, Substance
11/01/99: GOP, Clinton could reach deal swiftly
10/27/99: Bush to fight 'culture wars' -- positively
10/21/99: Porter, Mack: heroes on medical research
10/19/99: Gore scores among party big shots, but polls go South
10/14/99: Bush critiques could help GOP Congress
10/12/99: Congress can save health care from ruin
10/07/99: Will gun-control cause the GOP to shoot itself in the foot?
10/05/99: Gore moves: Desperate but necessary
10/01/99: Fox, Armstrong make case for NIH
09/28/99: Dems' race brightens Bush's chances
09/23/99: East Timor deflates `Clinton Doctrine'
09/21/99: Buchanan v. Bush? Yeah right
09/17/99: Candidates turn attention to poverty
09/15/99: Bush's education problem
09/09/99: Budget makes 2000 an `issues' election
09/07/99:Airport rage increases, with good reason
09/02/99: U.S. future up for grabs in 2000
08/31/99: U.S. Capitol needs visitor's center -- soon
08/24/99: Will 2000 be the year of the foreign crisis?
08/19/99: Neither party has upper hand for '99
08/17/99: Ford gets freedom medal one month early
08/12/99: There's time to catch Bush, say Gore aides
08/10/99: Rudy, Hillary try much-needed makeovers
08/09/99: GOP must launch new probe of Chinagate
08/02/99: Pols blow fiscal smoke on budget surplus
08/02/99: One campaign reform should pass: disclosure
07/27/99: Gore leads Bush in policy proposals

©1999, NEA