- The Washington Times - Wednesday, February 12, 2003

WASHINGTON, Feb. 12 (UPI) — President George W. Bush took his embattled 10-year, $674 billion economic growth proposal to small investors Wednesday and said accelerated tax cuts and elimination of double dividend taxation would help create jobs and strengthen its economic prospects.

Putting more money back into the hands of taxpayers and trusting them to spend and invest it wisely, he said, would lead to business expansion to meet new demand for goods and services — and that would spell jobs.

The president's remarks cheerleading his plan came in the wake of Federal Reserve Chairman Alan Greenspan's negative comments on the president's proposal during testimony before Congress on Tuesday.

Greenspan in essence said there should be no cutting of taxes until the situation of impending war with Iraq is resolved.

Bush's plan should not be passed now unless the government's loss of tax revenue — Bush estimates $50 billion would go back to taxpayers this year — is offset through other tax-garnering measures.

The White House estimates that about $50 billion would go back to taxpayers this year alone if the proposal is passed.

Bush, speaking to about 100 people at the Society of Human Resource Management in Alexandria, Va., did not comment on Greenspan's remarks.

America, Bush conceded, however, does face economic challenges.

"Here at home, we got a challenge with our economy," Bush said.

"Frankly, it's not strong enough. It is not robust enough. Any time somebody's looking for a job and can't find one means we've got to work together to create jobs.

"Now the role of government is not to create wealth," he added. "The role of government's to create an environment in which the entrepreneurial spirit can flourish, in which people are encouraged to invest and save, in which there's confidence in the future of the country. And that's what we're here to discuss today."

Bush's plan has been savaged by many economists and Democrats as growing the national budget deficit and for falling short on stimulating a sluggish economy.

They also charge that it benefits wealthier taxpayers more than average citizens.

Greenspan's cold shoulder was a blow to the president and new ammunition to Democrats.

" … There has now been a $7 trillion swing in the last 24 months between what the projected (budget) surplus was two years ago to what now the projected deficit will be if the president's plans are enacted — $7 trillion," Senate Minority Leader Tom Daschle, D-S.D., said Wednesday. "Four trillion of that are tax cuts — is tax cuts. So it is a dismaying demonstration of irresponsibility.

"Yesterday Alan Greenspan said he wouldn't support tax cuts without an offset. I would ask this president, 'Where is your offset?'"

Daschle said 300 economists were against the president's plan, which features acceleration of cuts in 2004 and 2006 to the marriage tax penalty and increased deductions for children, passed earlier, and also make them retroactive. The White House, meanwhile, has its own list of economists who favor the plan.

On Wednesday the president crossed the Potomac River into suburban Virginia as part of his strategy to sell the program to the American people: Personalize it.

"I want to personalize the issues and get away from the Ph.D.s," he told a group of small investors in a roundtable before his address. He would put the arguments into "personal terms to get a real-life connection."

The roundtable was conducted around a rectangular-shaped table in the lobby of a Charles Schwab & Co. office in Alexandria. Schwab, who was one of the 10 people seated around the president, said only one of the participants was a client.

"We're not rich, we're average Americans," housewife and mother of two Wendy Lane told Bush.

Lane said she and her husband, an engineer with an adjusted annual income of about $93,000, live below their means and put most of their spare money into paying off their mortgage faster "because we're scared, we're scared of the market."

Bush, appearing relaxed, explained how the accelerated tax cuts would help them by putting more money into their hands for investing in the market, which would see more mature-growth companies paying dividends because of the elimination of taxation on dividends.

Tim Roberts, chief musician and one of the national tour mangers for the U.S. Navy Band, told the president he works two extra jobs to augment his pay to afford living in the Washington area.

With the accelerated tax cuts, Bush said, Roberts, who is married and has one child with another on the way, would see his annual tax bill on a total annual income of $64,000 fall by $900.

Throughout the roundtable, Bush was engaged and animated, leading the discussion from one participant to another.

"All right," he said at last. "We're going to work. Pass me your nametags. I'll sign 'em if you want."

Bush delayed his departure for a few extra minutes, happily writing notes and signing autographs for the participants' children.

The president told them he enjoyed the roundtables, which he himself noted was conducted at a rectangle, because "it's a chance for me to get outside the bubble, meet my fellow Americans."

Moments later, with roundtable participants Roberts and Joan Hanover nearby, Bush spoke his prepared remarks on the economy, but with details about the participants in the roundtable, their hopes, their needs and how he sees his plan affecting them.

In his private meeting, Bush asked participants to tell fellow investors about how the plan would help them. He also asked them to encourage others to contact their senators and representatives and urging passage of the plan.

"I'll sign a bill this year," he said.

On Thursday, the president is scheduled to travel to Florida, where he again will speak on the economy.

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