- The Washington Times - Monday, October 15, 2001

Majority Leader Dick Armey predicted yesterday that the Republicans' $100 billion tax-cut bill to pull the economy out of a deepening slump will win strong bipartisan approval when it comes up for action in the House later this week.
Mr. Armey said that despite Democratic grousing over the size and shape of the bill that was approved by the Ways and Means Committee Friday on a party-line vote, many Democrats "are going to find it very difficult to vote against a tax-cut bill to put people back to work," especially at a time when the economy is sliding into a recession.
"I expect to have the bill on the floor on Thursday, and I expect it to pass with a large bipartisan vote," the Texas Republican said in an interview.
"I've seen this happen again and again since 1995 [when Republicans took majority control of the House]. Democrats complain about the process at every juncture until the bill gets to the floor and then they vote for it," he said.
But Mr. Armey said he fears that a much different stimulus bill will emerge from the Senate where he expects "the Democrats will write an income-redistribution bill. They're saying we've got to have more government spending programs that keep unemployed workers more comfortably unemployed for a longer period of time.
"We're saying we need to stimulate more business investment to create more jobs and get the unemployed back to work," he said.
Crafted by House Ways and Means Chairman Bill Thomas, California Republican, the stimulus bill is about $25 billion bigger than what President Bush proposed. It contains all of the tax-incentive proposals the administration wants to jump-start the economy, plus a few others that House Republicans added, and some items that the Democrats wanted as well.
Among its provisions, the bill would give tax rebates to those who did not qualify for income tax rebates sent out this summer and fall because they did not earn enough. It would accelerate the income-tax rate reductions passed earlier this year, let businesses write off new equipment purchases faster and repeal the minimum income tax.
It also would eliminate the five-year holding period for capital gains, which effectively lowers the tax rate to 18 percent, and offers aid to states to pay for rising unemployment costs and health insurance for the unemployed.
The House bill is expected to be significantly altered by Senate Finance Committee Chairman Max Baucus, Montana Democrat, who wants a bill somewhere between the $60 billion and $75 billion range that Mr. Bush proposed more than a week ago.
Mr. Baucus has been meeting frequently with Treasury Secretary Paul H. O'Neill, the president's point man in the stimulus debate, and with Sen. Charles E. Grassley of Iowa, the committee's ranking Republican. A top aide said yesterday that talks have been "continuing through the weekend."
"Chairman Baucus is very hopeful that we can maintain a constructive debate and move forward on the Senate side to produce a package that is short-term and fiscally responsible that will help people laid off and out of work," said Mike Siegel, the committee's spokesman.
Mr. Baucus and Democratic leaders are seeking three basic provisions in the bill: tax rebates for workers who did not get them earlier this year, temporary tax-cut incentives for business purchases and expansion, and a larger extension of unemployment benefits than Mr. Bush has thus far proposed.
Despite differences over unemployment spending and the capital gains provisions that Mr. Bush did not propose, the competing plans generally track the proposals that the president made to congressional leaders last week.
"Ultimately, the package that the Congress adopts will be along the lines that the president proposed," said White House economic adviser Lawrence Lindsey.
"There are some elements in the president's package that represented a good start. There is definitely a feeling that we want to produce a package in concert with leadership on both sides of the aisle," Mr. Siegel said.
Meantime, both sides agree on at least one thing: that Congress needs to act on a stimulus package sooner rather than later. "We need to get this passed as expeditiously as possible," Mr. Lindsey said.

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times is switching its third-party commenting system from Disqus to Spot.IM. You will need to either create an account with Spot.im or if you wish to use your Disqus account look under the Conversation for the link "Have a Disqus Account?". Please read our Comment Policy before commenting.

 

Click to Read More

Click to Hide