Scumbria,
You're going to love this one.....
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Bush Says Economy Is 'Winded' But Strong
President Presses for Immediate Tax Cut
By RON FOURNIER
.c The Associated Press
KALAMAZOO, Mich. (March 27) - Rejecting criticism he's been too gloomy, President Bush told Midwesterners who endured the Rust Belt recession a decade ago that tax cuts are vital to reversing recent layoffs and the stock market slump. ``The need for action is urgent,'' he declared Tuesday.
Bush made his case in a city that took an economic beating on his father's watch. He called the economy ``winded but fundamentally strong'' and predicted it would ``come roaring out of its doldrums'' if taxes are cut by at least $1.6 trillion over 10 years, as he has proposed.
Bush, in what aides billed as a major economic address, dismissed a new Democratic alternative for a one-time $300 tax rebate as a mere ``pick-me-up.'' He embraced Republican lawmakers' plans of backdating tax cuts so Americans would get an injection of spending money this year.
And he traced the roots of the sputtering economy and energy shortages to President Clinton, hoping to pass the blame in one of the more partisan speeches of his brief tenure.
Edit. Oh no, the gloves are off....we're in for it now.
``I strongly believe that meaningful, real tax relief can ignite another generation of growth,'' Bush said.
He broke no new policy ground in his 30-minute speech, but addressed Democratic criticism that his dour assessments have helped lower consumer confidence and weaken the economy.
``It's the president's job to look for warnings of economic trouble ahead and to heed them,'' Bush said.
A CNN-Time poll suggests that 60 percent of Americans believe Bush's talk about the country heading into tough times may have hurt the economy. By the same percentage, they said they believe the economy is heading into a recession.
Still, the New York-based Conference Board reported Tuesday that consumer confidence made a forceful comeback in March, with its index climbing 117 points.
The president planned to express his own confidence in the high-tech industry, aides said, in a speech Wednesday to some 200 technology company executives invited to the East Room.
Bush raised the possibility of a recession when he spoke to the Kalamazoo Chamber of Commerce, saying that even if the economy slips to the point it did during 1990 and 1991 - the heart of his father's term as president - the federal surplus would shrink by just 2 percent.
He also spoke bluntly about energy shortages - ``The lights are dimming in California'' - and he blamed ``years of neglect'' under Clinton for lack of a national energy strategy. Bush reaffirmed his opposition to price controls, saying they would bring the return of ``the gas lines of the '70s.''
With such talk, Bush seems determined not to repeat the mistake of his father, who lost the 1992 presidential race to Clinton in part because Americans felt he was out of touch with their economic hardships.
Ticking off a list of sagging economic indicators, all of which peaked before he took office, Bush said, ``Almost every week brings us reports of layoffs, especially in manufacturing. ... Some regions of America, and some industries are doing better, but the trend is clear, and the need for action is urgent.''
White House Press Secretary Ari Fleischer, using a new formulation to strike back at Democratic critics, told reporters lawmakers who stand in the way of Bush's economic plan ``risk being out of touch'' with Americans.
The message has particular resonance in Michigan, where thousands of automobile workers are being laid off and memories of the 1990-91 recession linger. The unemployment rate here was a relatively low 4.5 percent in February, slightly higher than the national average but up from 3.3 percent the same month last year.
Bush lost Michigan to Sen. John McCain of Arizona in the GOP primaries and again in November to Democrat Al Gore.
Democrats have seized on Bush's talking down of the economy to propose smaller plans for tax cuts or rebates, jeopardizing the president's more aggressive approach.
As Bush addressed business leaders here, Senate Democrats proposed a $300 tax rebate this year for every American taxpayer to quickly inject $60 billion into the sluggish economy.
Senate Minority Leader Tom Daschle, D-S.D., said a second part of the Democratic plan to lower the bottom 15 percent income tax rate to 10 percent has broad support among Democrats and Republicans and shouldn't await passage of Bush's broader package.
``We can act now to take these two widely agreed-upon proposals off of the table, and get them to the president's desk,'' Daschle said. ``Let's get this done now.''
Bush rejected the plan, saying the economy needs both short- and long-term cures.
``The economy needs more than a pick-me-up, more than a one-time boost,'' Bush said. ``Our economic health depends on people feeling comfort and confidence about long-term decisions - to start a new business, to invest in a new idea, to buy a new home. And the people who make those decisions don't care only about this year's tax rate; they care about next year's rate, and the year after that.''
Bush's advisers have sounded out Democrats about linking a short-term multibillion stimulus tax cut with his 10-year package, but they have found few allies in the evenly divided Senate. Some moderates Republicans also worry about the political impact of backing a Bush plan that gives most of the tax cut revenue to the wealthy.
The administration has sent signals that Bush is open to compromise, including extending the phase-out dates on the estate tax.
AP-NY-03-27-01 1842EST
Copyright 2001 The Associated Press |
