UPDATE 3-Bush meets high-tech leaders, firm on tax cut
THURSDAY, JANUARY 4, 2001 3:43:00 PM EST
01-04 0893 UPDATE 3-Bush meets high-tech leaders, firm on tax cut
(Releads with Bush quotes, end of meeting, edits)
By Patricia Wilson
AUSTIN, Texas, Jan 4 (Reuters) - President-elect George W. Bush pushed his economic and education agendas with high-tech executives on Thursday, coming away "concerned" about the U.S. economy in the short-term but "optimistic" about the future.
Bush stuck firmly to his campaign pledge to seek a $1.3 trillion tax cut he said was essential to boost the slowing economy and suggested he might ask Congress to speed up the timetable for it.
"We're concerned about the short-term economic news but in the long term I'm optimistic," Bush told reporters at the end of a two-day meeting with business leaders on the economy.
"I am thinking through my strategy right now," he said after a session with a dozen executives at the University of Texas. "I think that tax relief is necessary the question is how fast we implement it. It is possible that we may need to implement it faster."
Bush said he believed Federal Reserve Chairman Alan Greenspan had orchestrated a surprise cut in interest rates on Wednesday because he was concerned about the economy not because he wanted to make "a statement about fiscal policy."
"I think he recognized that there are warning clouds on the horizon for our economy and he took action," Bush said.
Bush, who will be sworn in on Jan. 20, kept up his busy schedule of pre-inauguration meetings, planning to discuss defense issues and military readiness with a group of congressional Republicans and Democrats in Austin on Monday and heading for Washington on Tuesday for an education forum.
Eight of Bush's Cabinet appointees visited Capitol Hill on Thursday, most of them paying courtesy calls on the senators who must confirm their nominations.
IRON TRIANGLE INTACT
With his inner circle complete, Bush turned to filling out sub-Cabinet and White House positions and still has some important jobs to fill, including director of the Central Intelligence Agency, ambassador to the United Nations and U.S. trade representative.
In naming Karl Rove, his chief strategist, to the White House post of senior adviser and Joe Allbaugh, his campaign manager, to head the Federal Emergency Management Agency on Thursday, Bush noted he had now brought all three legs of the "Iron Triangle," his cadre of trusted Texas aides, to Washington.
Longtime communications director Karen Hughes was named as a counselor to the new president last month.
"It is a wonderful pleasure to announce that the triangle has been completed," Bush said at a brief ceremony.
Rove, 50, guided Bush to victory in spite of grumbling from the Republican establishment that he lacked experience in a national political campaign.
Allbaugh, 48, a longtime behind-the-scenes political strategist, maintained his low profile during Bush's campaign, but staff credited his organizational and management skills with "making the trains run on time."
As Bush wound up the second of a two-day forum on the economy, his chief economic adviser, former Federal Reserve Board Governor Lawrence Lindsey, said the timing of a tax cut was under consideration.
The first of Bush's proposed across-the-board cuts would take effect in 2002, but Lindsey said the timetable could be compressed to use tax relief "as a way of stimulating the economy."
INSURANCE POLICY
"Gov. Bush always said during the campaign ... this also represented an insurance policy," he told ABC's "Good Morning America." "And it's very possible that, particularly cuts for moderate income people, could be made sooner than that."
Bush said the corporate leaders he met on Wednesday had "brought some pretty bad news" and that the country needed "bold action" to arrest the current economic slowdown.
The Federal Reserve stepped in to shore up the economy with a half-point cut in a key interest rate, delighting Bush, the three dozen corporate chiefs and the stock market.
Before the rate cut was announced, bipartisan momentum for a tax cut appeared to build with U.S. House of Representatives Democratic leader Richard Gephardt saying a weaker economy could necessitate a larger tax cut than previously envisioned.
Among those Bush met with on Thursday were about 12 leaders of mostly blue chip high-tech firms, including International Business Machines Corp. IBM. Chairman Louis Gerstner, Dell Computer Corp. DELL Chairman Michael Dell and Scott McNealy, chief executive of Sun Microsystems Inc. SUNW. many were contributors to his presidential campaign.
Bush said they discussed a wide range of issues including education, job training, trade and litigation reform.
"And we talked about how genuinely optimistic we are about the long term for the country, about how they're some concerns for the short term," Bush said. "All in all it was a fantastic meeting."
The high-tech sector has been battered over much of the last year by the bursting of a speculative bubble in Internet company stocks, which has dragged down stock markets and threatened to slow the U.S. economy after an unprecedented eight years of growth under outgoing President Bill Clinton.
Rtr 15:43 01-04-01 Copyright 2001, Reuters News Service www2.marketwatch.com |
