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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: JakeStraw who wrote (404232)	5/8/2003 2:36:27 PM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 769670

Good and bad tax cuts By 0, 5/8/2003 IF PRESIDENT Bush were really so eager to stimulate the economy with tax cuts, he would do the sensible thing and put the money in the hands of those who will spend it, and spend it quickly. Who would doubt that working adults, the unemployed, and hard pressed city and state governments reeling from their worst financial crisis since World War II would spend the money as soon as the check arrived? These would be the beneficiaries of a tax cut package offered this week by Democrats as a counterpoint to the president's tax cut proposal, which would fail to help the states and would actually reduce revenue for many of them even as it delivered most of its benefits to the wealthy. Republicans and Democrats are expected to join those issues today when the Senate Finance Committee begins debating taxes. In truth, it is shocking that Congress is this far down the road to any tax cut at all at a time when it is being forced to raise the national debt ceiling by nearly $1 trillion more. Members should know that large deficits threaten the national economy in the long run and are bad politics, too. Still, if there is to be a tax cut, it should be a modest one targeted to benefit the people who need it most and would be likely to spend it right away. The Democratic plan for a $152 billion tax cut over 10 years is a small fraction of the $415 billion tax cut plan Republicans are proposing in the Senate and the $550 billion plan offered by House Republicans. Besides including $72 billion for a wage tax credit for every working adult and $12.7 billion to extend unemployment benefits, the Democrats provide immediate relief for local and state governments, which would get $32 billion in aid in 2003 and $8 billion more spread over the next 10 years. By contrast, the Bush-backed plan offered by Senator Charles Grassley of Iowa would deprive states of nearly $8 billion in revenue from tax years 2003 through 2005, according to an analysis done by Iris J. Lav, deputy director of the Center on Budget and Policy Priorities in Washington. The Massachusetts share of that $8 billion reduction would be $350 million. The Republicans insist on cutting taxes on dividends as a centerpiece of their proposal, but this would also reduce state revenues because 37 states and the District of Columbia use federal definitions of income in their own tax systems and with few exceptions would therefore automatically exclude dividends from state taxable income, Lav said. So if Bush and his Republicans friends have their way, Massachusetts will continue reducing the number of police and firefighters, Missouri will keep unscrewing every third light bulb, teachers in Oklahoma will keep doubling as janitors, and teachers in Oregon will have to keep working those two weeks without pay. This story ran on page A19 of the Boston Globe on 5/8/2003. © Copyright 2003 Globe Newspaper Company.