Wednesday, April 11, 2001
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Wednesday, April 11, 2001 |
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Tax cut gets buried; will it rise again? By DAVE HAMRICK I thought about writing an Easter column, but you've probably seen about 15 of those in our publications so far. So all I'll say on that subject is: Happy Easter, and may you be filled with the joy of abundant life and the hope of Resurrection. I'll stick with politics this week. And politically speaking, I'm beginning to wonder if there's any hope for resurrection of the president's tax cut plan. Democrats, with the help of a couple of renegade Republicans, whittled a very modest $1.6 trillion tax cut down to $1.2 trillion in the Senate. What will this watering down of the tax cut do to the nation? Much depends on the shape of the final bill. The House has approved Bush's full ten-year, $1.6 trillion cut. The Senate version is the problem. Basically, Senate Democrats have fired a shot across the White House bow. That's a mixed metaphor, but you get the drift. Democrats are hoping that, since the Senate won't pass the House version (the same as the president's version) and the House isn't likely to agree to the Senate amendment, then Bush and House leaders will have to sit down with Democrats and negotiate. In other words, they're going to try and use the leverage on the administration to keep as much money in Washington as possible, so they can spend it. Well, I was hoping for more meaningful change ... something that would move us more toward a society in which the government is not an albatross around every worker's neck. But you take what you can get. Will it ruin our chances for economic recovery? I doubt it. The economy needs a shot in the arm right now, but we're not exactly in a recession. The stock market is going a little crazy, but something the media usually fail to tell you is that the stock market is not the economy. Our economy is still growing, not as fast as it needs to, but it's growing. A smaller than originally proposed tax cut will simply provide less than originally proposed relief. Democrats will play the class envy card, as they always do, and insist that, however large the tax cut, more of it go to lower income people and less to higher income people. So when Joe Sixpack gets a $1,500 tax cut instead of the $1,100 tax cut he was going to get, he'll buy another speaker for his pickup truck, and that'll provide some boost to the economy. But when some mover and shaker gets a $100,000 tax cut instead of the $150,000 tax cut he was going to get, he'll simply invest a little less and not create as many new jobs, the difference completely wiping out any good that'll come from old Joe's extra $400. But Joe will appreciate it ... I really will. Meanwhile, Fayette County's own representative in the House, Mac Collins, is on the offensive. Regardless how this particular tax cut fight comes out, Collins is introducing new tax cuts to try and get us some immediate relief. As for the effects of this fight on the Bush legacy, it's a little early to start calling that yet. This is just the first battle, and it's not even over yet. The Bush camp is confident that the final tax cut, hammered out in conference between House and Senate, will be larger than the current Senate version. And there will be many more battles, both domestic and foreign. How Bush deals with this Chinese crisis is going to be important. If he gives in and apologizes to get our people back, he loses. If something bad happens to our people, he loses. If he can find a way to word a statement so the Chinese can play it as an apology back home, and yet Americans see it as less than that, he wins. Multiply that by several thousand, and you can see what life's going to be like for George and Barbara's boy for the next four years. I'm just glad it's him and not me.
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