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Bush takes budget to nation

In his first address to Congress, the president continues to promote his proposed $1.6-trillion tax cut.

Washington Bureau Chieffritz
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© St. Petersburg Times, published February 28, 2001

WASHINGTON -- In his first speech to Congress, President Bush tried Tuesday night to dispel growing fears that his proposed $1.6-trillion tax cut would gobble up the entire federal revenue surplus, leaving no money for other things.

Bush insisted he intends to pay down the federal deficit by a record $2-trillion over the next 10 years and invest in many new programs -- education, health care, retirement benefits, the environment and defense -- before he cuts taxes. He also promised to set aside $1-trillion as a contingency fund to guard against an unexpected shortfall in revenues.

The speech was the biggest event so far in Bush's fledgling presidency and his best opportunity to persuade Congress and the American people of the wisdom of his controversial legislative agenda. It was also the first time since 1954 that a Republican president has addressed a Republican-controlled Congress.

Although he was interrupted many times by applause, the president's presentation was shorter and more concise than any comparable speech delivered to Congress by his predecessor, former President Bill Clinton.

Instead of outlining a lengthy laundry list of large and small initiatives, as Clinton always did, Bush mentioned a limited number of major legislative items. He said he wanted to create a government that was "active but limited, engaged, but not overbearing."

Bush also sought to set himself apart from his predecessors by noting that he had tried to set a new tone of "civility and respect" in Washington. "I hope America is noticing the difference," he said.

But more than anything else, Bush was striving in his speech to answer directly the Democratic criticism that his plan would squander a rare historical opportunity to use surplus revenue for necessary reforms in Medicare and Social Security, among other things.

He said that unless the Congress trims taxes substantially this year, it would be tempted to go on a spending spree with money that rightfully belongs to American taxpayers. Spending, not tax cuts, is the cause for government budget deficits, according to Bush.

"Unrestrained government spending is a dangerous road to deficits, so we must take a different path," he said. "The other choice is to let the American people spend their own money to meet their own needs, to fund their own priorities and pay down their own debts. I hope you'll join me and stand firmly on the side of the people."

Bush estimated his tax cut plan would put $1,600 a year into the pockets of a typical American couple with two children. He described it as "a refund" owed to taxpayers who had been overcharged in recent years.

"Sixteen hundred dollars may not sound like a lot to some, but it means a lot to many families," he said. "Sixteen-hundred dollars buys gas for two cars for an entire year, it pays tuition for a year at a community college, it pays the average family grocery bill for three months. That is real money."

The proposed tax plan would lower all five current income tax rates, instead creating four levels: 10 percent, 15 percent, 25 percent and 33 percent. It would also abolish the estate tax, eliminate the so-called marriage penalty for two-wage-earner couples and double the child credit to $1,000 for each offspring.

As in the past, Bush also defended the size of his proposal as "just right." He added: "I did not throw darts at a board to come up with a number for tax relief. I did not take a poll, or develop an arbitrary formula that might sound good. I looked at problems in the tax code and calculated the cost to fix them."

In the tradition of presidents John F. Kennedy and Ronald Reagan, Bush argued that his tax cut must be enacted soon to help stimulate a slowing economy. If Congress enacts it quickly, he said, there will be sufficient time remaining in the year for the lawmakers to tackle long-term reforms in the Social Security and Medicare programs.

Bush said his budget for the next fiscal year -- which will be sent formally to Congress today -- will propose an increase in spending for Social Security, Medicare and entitlement programs by $81-billion. It will also increase discretionary spending by another $26-billion -- an increase of 4 percent, less than in recent years.

To satisfy Democrats calling for elimination of the national debt, Bush said the budget promises to pay down the national debt by $2-trillion over the next 10 years. "That is more debt repaid more quickly than has ever been repaid by any nation at any time in history," he said.

He said education would be his highest priority, getting the biggest percentage of the increase. It will include $5-billion to help every American child to read. He defended the idea of mandatory testing for children, arguing that even when schools are "teaching to the test" they are teaching the essentials: math and reading.

Bush's budget will dedicate $238-billion for Medicare next year, including enough to begin a prescription drug benefit for low-income seniors. He also proposed refundable tax credits for uninsured Americans to help them buy health insurance.

He promised to preserve the $2.6-trillion Social Security surplus exclusively for Social Security. He said he would appoint a commission soon to forge a compromise for reforming Social Security. In addition, Bush said he was asking Congress to provide $5.7-billion next year for increased military pay and benefits and $4.9-billion over the next five years to preserve national parks.

Like every president since Reagan, Bush invited some special guests to sit with his wife in the House gallery to watch the speech. In a bow to first lady Laura Bush, he also disclosed she intends to dedicate the next four years to recruiting Americans to become teachers.

Billed by the White House as "real Americans," Bush's guests included a teacher from Hyattsville, Md.; a preacher from Houston; an educational leader from New York; a newly naturalized Vietnamese-American from Northridge, Calif.; a nun from New York; a teacher from Washington, D.C.; a military officer from Alexandria, Va.; a couple from West Chester, Pa.; a teacher from Accokeek, Md.; a sufferer of Down's syndrome from Knoxville, Tenn.; and the mayors of Philadelphia and Washington, D.C.

In honoring Philadelphia Mayor John F. Street, Bush noted he is a Democrat. "Let the record show I lost his city -- big time," the president said. "Some things are bigger than politics."

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