Bush is promoting a $1.6 trillion tax cut proposal as a needed economic stimulus and a boon for working people. "The American family had a victory today," Bush announced to a large crowd March 8 in Fargo, North Dakota, when news came that the House of Representatives had passed the tax cut.

The tax bill, however, will allocate 43 percent of reductions to the richest 1 percent of the population, many of whom already pay few taxes due to extensive loopholes and shelters provided in federal and state tax law. For the one-third of workers and farmers in the country whose earnings are so low that they are eligible to pay no income taxes, the plan would have no effect.

The Bush tax cut proposal comes after a decade of growing earnings and shrinking tax liability for the superwealthy few. From 1989 to 1998, the incomes of the wealthiest 1 percent of the population, adjusted for inflation, grew eight times as fast as the bottom 90 percent. In addition, the share of their annual income--which averaged $816,189--that the top 1 percent paid in taxes was 27.1 percent in 1998, down from 28.9 in 1996.  
 
'Too small and too slow'
For some, however, these advances for the wealthy are not adequate in the face of the slowdown in the economy and the sharp decline in stock values on Wall Street and in other exchanges around the world. "We hate to be a spoilsport," the Wall Street Journal editors exclaimed February 8, but "someone has to point out the emerging danger that whatever passes Congress could be too small and especially too slow." Bush's plan would bring the top tax bracket down from 39.6 percent to 33 percent over five years. The Journal's editors urged immediate adoption of the rate cuts and repeal of the estate tax, also part of the Bush measures. The paper called for elimination of the "alternative minimum tax," which the editors called "onerous." This tax is applied when people with large tax deductions reach a certain low level of tax payments.

In a March 23 editorial titled "The Beltway Fiddlers," the Journal editors took a more strident tone. Pointing to the sharp fall in stock prices, they called for a more generous and immediate tax cut for the higher bracket payers. "Washington is fiddling while the economy burns," the editors fumed, and for members of Congress, "the moribund state of American manufacturing, the earnings meltdown or a Charles Schwab [stock brokerage firm] announcing 3,400 layoffs, and P&G [Proctor and Gamble] 9,600 more, is like radio signals from faraway galaxies."

House conservatives are proposing a $2.2 trillion tax-cut package that includes cuts in taxes on capital gains.  
 
Manufacturers in hard hats
Bush is not the only one trying to put a pro-working class spin on the tax cut. The National Association of Manufacturers sent out a memo encouraging members to attend a tax cut rally outside the Capitol March 8, urging people in a memo to be "DRESSED DOWN, appear to be REAL WORKER types, etc." The memo continued, "We plan to have hard hats for people to wear. Other groups are providing waiters/waitresses, and other types of workers."

The National Association of Manufacturers is one of four groups leading the Tax Relief Coalition, an association of nearly 100 trade associations and companies lobbying for tax cuts for big business. The other three leading groups in the coalition are the U.S. Chamber of Commerce, the National Association of Wholesaler-Distributors, and the National Federation of Independent Businesses.

In addition to tax reductions, Bush's budget includes proposals to increase military spending by 4.8 percent to $310.5 billion, and to cut $17.9 billion from the Department of Agriculture budget and $7.3 billion from the Environmental Protection Agency. Farmers at the March 2–5 convention of the National Farmers Union voiced concern that the proposed cuts in agriculture spending will be aimed at reducing the substantial emergency aid that farmers have fought for to compensate for below-cost prices for their commodities.

Most Democrats opposed Bush's tax cut proposals during the 2000 campaign, but many now favor most elements of the plan. Tom Daschle, the Senate's Democratic Party leader, announced support March 23 for the immediate $60 billion tax cut proposed by Republicans. Many Democrats oppose the extent of the tax rate cuts at the higher brackets, some of the budget cuts that would affect social programs and aid to farmers, and Bush's repeal of some of Clinton's last-minute regulations.

The framework of all tax cut proposals before Congress is a continuing budget surplus. But in light of a falling stock market and a gloomy economic forecast, some politicians are expressing doubts that revenues will sustain a surplus. In the Senate, where no majority exists on any tax plan, a dozen senators from both parties introduced a 10-year tax cut plan with a "safety valve" that would delay cuts in years when no budget surplus is predicted.

Bush is making other moves to ease up regulations on mining, manufacturing, and energy companies, also in the name of stimulating the economy.  
 
Looser regulations on big business
The administration is responding to energy blackouts in California by calling for massive tax breaks for the energy companies and other measures, including lifting the prohibition on oil and natural gas drilling in Alaska's Arctic National Wildlife Refuge and other federally protected lands. Energy Secretary Spencer Abraham, in a speech to the U.S. Chamber of Commerce, said failure to carry out such measures "will threaten our nation's economic prosperity, compromise out national security, and literally alter the way we live our lives."

Frank Murkowski, a Republican senator from Alaska and author of a bill to overhaul U.S. energy policy, cites U.S. national security interests in his push to open up the Arctic to drilling. "American dependence on foreign oil threatens our national security and our freedom," said Trent Lott, Senate majority leader, in supporting the bill. Murkowski's bill aims to reduce U.S. dependence on oil imports by 50 percent, particularly from Iraq and Iran, who he describes as "unstable nations." The U.S. companies buy 750,000 barrels of oil a day from Iraq.

Widespread sentiment against despoiling the environment exists in the United States, however, and Republican leaders in the House decided to withdraw the Alaska drilling proposal from the budget package.

Democrats responding to Abraham's attack on the Clinton administration's track record on energy, pointed out that Clinton permitted more leasing and exploration on public land than any previous president.

In other measures to ease up protective environmental regulations, Bush announced March 13 that he would not regulate carbon dioxide emissions, which are thought to contribute to global warming. During his campaign for president last year, Bush said he supported reduction of emissions. Christine Whitman, his Environmental Protection Agency (EPA) director, had indicated in February that the administration was moving toward regulation.

On March 20, Whitman announced the EPA was withdrawing federal standards reducing by 80 percent allowable levels of arsenic in drinking water. "I want to be sure that the conclusions about arsenic in the rule are supported by the best available science," Whitman said. The National Academy of Sciences has concluded that arsenic in drinking water causes bladder, lung, and skin cancer, and might cause liver and kidney cancer.

Bush has indicated he wants to block a new regulation requiring hard-rock mining companies to post a bond guaranteeing they will clean up the environmental damage they cause, and a recent ban on new roads and almost all logging on 58.5 million acres of national forest.  
 
 
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