Wednesday January 3 11:14 AM ET
Bush Huddles With Business Leaders
By SCOTT LINDLAW, Associated Press Writer
AUSTIN, Texas (AP) - After warning anew of a slowdown, President-elect Bush assembled a collection of top U.S. business leaders on Wednesday to take stock of the economy.
Bush will use the session ``to listen to their thoughts and ideas and to build support for his agenda,'' including his proposed $1.3 trillion 10-year tax cut, said Bush transition spokesman Ari Fleischer.
Nearly three-dozen executives from new and old economy ventures were gathering behind closed doors with Bush.
They included leaders of some of the companies that have been hit the hardest by the recent slump in the stock market and by falling sales.
Fleischer defended Bush's increasing emphasis about the nation's slowdown, denying that it was a political attempt to lay blame with the outgoing Clinton administration.
Still, Fleischer said in a morning conference call with reporters that recent economic reports have raised ``serious questions about the strength of the economy.''
He said Tuesday's report suggesting another decline in manufacturing ``indicated that the economy is performing at its worst pace'' since the recession in 1991.
``So there is plenty of new evidence to buttress President-elect Bush's statements and the statements issued in the private sector about the weakening in the economy, the troubles that we're inheriting,'' Fleisher said.
As the 107th Congress prepared to convene Wednesday, House Minority Leader Richard Gephardt said that, because the economy is slowing, Congress may need to pass a larger tax cut than many Democrats have favored.
However, Gephardt predicted, Democrats will continue to resist the $1.3 trillion plan proposed by Bush - a plan whose benefits would be tilted sharply in favor of those with higher incomes.
``I think we need a tax cut,'' Gephardt, D-Mo., said on NBC's ``Today'' show. ``I've felt that and Democrats have felt that way for a long time. I don't know the exact size. It may be that it has to get bigger because the recession is looming and we've got economic worries out there.''
Gephardt added, ``I think we can work out a compromise where everybody gets some of what they want'' from a tax cut.
Fleischer responded by saying that Gephardt's were ``heartening'' and appeared to represent ``more evidence that we can work together.''
Republicans tried to push a large tax cut through Congress last year but were blocked by President Clinton (news - web sites).
The president-elect reiterated his view Tuesday that tax reductions could stave off a recession: ``I'm worried about an economic slowdown, and I believe it is important for us to ensure against any economic slowdown by a responsible tax relief package.''
Bush was unlikely to hear significant disagreement from his audience Wednesday. Most of those invited were political or financial supporters, or both.
Others were leaders in his campaign last year, such as Gerry Parsky, the chairman of Bush's California effort. Parsky is also a Los Angeles venture capitalist.
Also on the list of attendees was Steve Forbes (news - web sites), one of Bush's rivals for the Republican presidential nomination last year. Forbes was sharply critical of Bush's tax cut proposals, but endorsed the Texas governor in March after dropping out of the race.
Other notable attendees included Jack Welch, chief executive of the General Electric Co.; Michael Dell, CEO of Dell Computer Corp.; and Dan Carp, chief executive of Eastman Kodak Co.
The leaders of Bush's economic team were skipping the Austin meeting so they can pay courtesy calls on key members of the Senate, which must confirm the Cabinet picks.
Treasury Secretary-designate Paul O'Neill was meeting Wednesday with Sen. Charles Grassley, R-Iowa, new chairman of the Senate Finance Committee with jurisdiction over taxes, trade, Social Security and Medicare. Meanwhile, Senate Commerce Committee Chairman John McCain (news - web sites), R-Ariz., has scheduled a hearing for Thursday on Bush's nomination of his campaign chairman, Don Evans, to be secretary of commerce.
Bush economic adviser Larry Lindsey and policy aide Josh Bolten were attending the forum, along with chief of staff pick Andrew Card, political adviser Karl Rove and counselor Karen Hughes.
A report released Tuesday showed that U.S. manufacturing fell in December to its lowest level in nearly a decade. The government reported last month that gross domestic product fell in late 2000, and that unemployment climbed.
Bush's warnings have annoyed the Clinton administration, which maintains that such gloom-and-doom talk can be self-fulfilling. White House economists believe they are leaving the economy in good shape.
Clinton also held a two-day economic forum before taking office in 1993. More than 300 economists, business and labor leaders took part. The forum was televised nationally, with members of the public asking questions by telephone.
A second Bush forum focusing on high-technology was planned for Thursday, also behind closed doors.
Bush convened the forum one day after completing nominations for his Cabinet. On Tuesday, he landed his promised Democrat, picking Clinton's commerce secretary, Norman Y. Mineta, to head the Transportation Department.
He also nominated outgoing Sen. Spence Abraham of Michigan to be energy secretary, and Linda Chavez, who served as director of the civil rights commission under President Reagan, to be labor secretary.
On the Net:
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