Bush assails ‘income inequality’

President Bush yesterday said there is a growing “income inequality” gap between rich and poor Americans, and told companies they should rethink the giant compensation packages they offer top executives.

The markedly populist message, a divergence from the past, in which Mr. Bush has accused critics of practicing class warfare, was all the more noteworthy given his venue — a speech at Federal Hall in New York, in the middle of Wall Street, the capital of capitalism.

But the president called for conservative market-based answers, including demanding that Congress renew trade-promotion authority, which allows him to negotiate trade agreements then present them to Congress in a take-it-or-leave-it fashion.

Mr. Bush said he expects a bruising debate before his current trade-promotion authority expires July 1.

“Bashing trade can make for good sound bites on the evening news,” Mr. Bush said. “But walling off America from world trade would be a disaster for our economy. Congress needs to reject protectionism.”

In what was billed as his update on the state of the U.S. economy, Mr. Bush took credit for the 2001 and 2003 tax cuts, promised to submit a budget next week that eliminates the deficit in 2012, and asked Congress to give him a version of line-item veto authority.

“When people across the world look at America’s economy, what they see is low inflation, low unemployment and the fastest growth of any major industrialized nation,” he said. “There is one undisputed leader in the world in terms of economy, and that’s the United States of America.”

But Democrats said Mr. Bush’s rosy picture of the overall economy was out of focus.

“If you really spend time out in middle-class America — if you descend from the president’s economic view at 30,000 feet to the real communities of Main Street America — you know that all is not well with the middle class,” said Sen. Charles E. Schumer, New York Democrat.

Mr. Bush has spoken of corporate responsibility before, most notably following the accounting scandals that ensnared companies such as Enron early in his administration.

But yesterday marked the first time he has spoken of a problem of income inequality.

“The fact is that income inequality is real; it’s been rising for more than 25 years,” he said, adding that he sees the dividing line as between those with good educations and those without.

He also challenged businesses to “step up to their responsibilities.”

“They need to pay attention to the executive-compensation packages that you approve. You need to show the world that America’s businesses are a model of transparency and good corporate governance,” he said.

After his speech, the president made an unannounced stop on the floor of the New York Stock Exchange, getting a warm reception amid the chaos of the room.

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