Bush Tax Offensive Elevates Misstatements to Policy

When George W. Bush said "It's hard to put food on your family" some laughed it off as an example of an endearing personality trait, while others seized upon it as raw material for comedy and satire. Few would have thought that his penchant for occasionally saying the opposite of what he meant would be elevated to administration policy. But in these, the early days of promoting his tax cut initiative, a discontinuity between rhetoric and practice seems to be calculated.

Bush's speech on February 27 to a joint session of Congress, in the words of Senator John Breaux, (D-La.) "could have been given by a moderate Democrat or a moderate Republican." In practice, though, he has held to partisan right-wing positions, particularly concerning his proposed $1.6 trillion tax cut. Here his strategy is apparently to assume unanimous support of congressional Republicans, as well as defections from conservative Democrats, to carry his proposal without modification.

Some observers, including members of Congress, have expressed surprise that an administration that lost the popular vote would not try to build a consensus from the political middle. The Bush team apparently does not want to begin the tax cut debate by seeking compromise. In the words of Tom Mann of the Brookings Institution, quoted in the Washington Post, "This is not a government of national unity. This is not a center-out coalition. It's breathtaking what so fragile an electoral base is producing."

Democrats Richard Gephardt and Tom Daschle are reported to have warned Bush that trying to push through a tax bill without a full budget proposal in place would be a "huge mistake." Bush's tactics have driven Conservative Democrats, who earlier signaled a willingness to work with the administration, back into a posture of opposition. Representative Charles W. Stenholm (D.-Tex) and other conservative Democrats helped lead opposition to the Bush tax proposal in the House. Stenholm and others have been targeted with direct mail campaigns to their constituents, urging support for the Bush tax plan.

It's not yet clear to what extent the heavy-handed legislative tactics in the House are the work of the Republican congressional leadership, and to what extent the White House coordinates them. Some have suggested that Bush is in danger of making the same mistake Bill Clinton did in his first year, by yielding power to Congress. The size of the Bush tax cut could leave little money to make deals with Democrats during budget negotiations later in the year.

The Democrats' tax proposal cuts tax rates only for moderate- and lower-income families, cuts taxes for people at the lowest income levels with a credit for Social Security and Medicare taxes (the main federal taxes for people in this bracket), and adjusts rather than repeals the marriage penalty and estate taxes.
Once again, however, rhetoric and practice are not in sync. Treasury Secretary O'Neill scoffed at suggestions that the Bush tax cut distributes its proceeds inequitably, calling it "a nonsense set of statistics." The Treasury department's own calculations, however, show that two thirds of those benefiting from a cut in the estate tax are among the wealthiest one percent of Americans.

Beyond mere inequity, though, the Bush proposal seems a Reagan-style attempt to starve the federal government of funds needed to operate programs. Bush budget director, Mitchell Daniels, has been quoted as labeling the suggestion of budget cuts "laughable." Nonetheless, ten major departments are being asked to reduce their expenditures.

Social Security and Medicare, of course, are the biggest programs that would suffer under the Bush tax plan. Treasury Secretary Paul O'Neill last week, while refusing to confirm that money taken from the Social Security trust fund would be used to improve its solvency, offered instead that it would support "the Social Security concept." Whose concept, and what that means remains to be seen.

References:

Balz, Dan "President's Words Belie His Tactics, Democrats Charge" 4 Mar 2001.