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    A Times Editorial

    Republican baloney

    Congressional Republicans are promoting tax cuts for corporations and higher-income workers even though those are unlikely ways to effectively stimulate the economy.

    © St. Petersburg Times,
    published October 28, 2001


    So much for bipartisanship and the feeling that we're all in this together. The U.S. House passed a $100-billion economic stimulus package, mostly along party lines, that would give most of the benefits to corporations and higher-income workers. Now it is on to the Senate, where Democratic leaders favor more help for lower-income Americans and increased spending, rather than tax cuts, to lift the economy out of recession. Democrats should be heartened by the fact that even with serious arm-twisting by Republican leaders, the House bill barely squeaked through by a two-vote margin.

    Republicans are trying to make the case for tax cuts to get the economy going. But their arguments make little sense. It is widely acknowledged that increased consumer spending will lead the way out of our economic doldrums. Yet the House bill would give $70-billion to corporations in the form of tax cuts and rebates, money that is unlikely to create jobs or spur growth. "You can give billions of dollars to the corporate structure, but if no one's buying cars, if no one's buying washing machines, what can they invest in?" said Rep. Charles B. Rangel, D-N.Y.

    Rather than boosting the economy, it looks like Republicans have seen an opening to expand President Bush's $1.3-trillion tax cut passed earlier this year. In addition to the corporate tax giveaway, the House bill would accelerate Bush's tax-rate reductions for wealthier earners. Yet those are individuals who are more likely to save the money than spend it now. The Democratic plan would get more money into the hands of the recently unemployed and lower-income workers, which is not only more humane, but also more likely to put money into circulation quickly.

    The cynicism shown by House Republicans at a time when the government is asking for shared sacrifice is disillusioning. Several admitted that the bill was not realistic. Rep. Thomas M. Davis III, R-Va, called it "a little overreaching in the House because you know you're going to be bargained down in conference." Apparently Davis and his colleagues didn't consider writing a responsible bill that is fair to all Americans.

    Now, Senate Majority Leader Thomas A. Daschle, D-S.D., needs to bring equity and effectiveness to the plan. The closeness of the House vote (Democrats were one vote away from a deadlock on the bill) should strengthen his hand. Daschle recognizes that a temporary stimulus is more responsible than permanent tax cuts, which will eventually drain the federal budget and likely weigh it down with deep deficits. Democratic alternatives would extend unemployment payments and help those who lost jobs with health insurance. Certainly those who have suffered most in the sudden economic downturn deserve a helping hand.

    Daschle thinks a bipartisan compromise is likely. It should be if the Bush administration and congressional Republicans value a united front in the face of great challenges. That still won't excuse those Republicans who chose this time of vulnerability to promote their narrow interests.

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