- The Washington Times - Sunday, April 7, 2002

The political battle over President Bush's tax cuts is heating up again, with some Democrats calling for killing parts of his 10-year rate-reduction plan and Republicans moving to make all of it permanent.
As the April 15 taxpayer filing deadline approaches, and with elections just seven months away, both parties were gearing up for a week of political events to reach out to taxpayers in various ways. The Democratic National Committee, unions and women's rights groups were planning to hold rallies around the country for equal pay for women. Republicans were going to remind voters of the tax cuts they enacted to lift the economy out of its unusually brief recession.
Democratic leaders and outside advisers continued to attack Mr. Bush and his party over the tax cuts that they said were to blame for the deficits and the economic slump. But a DNC official said yesterday that, as much as Democrats opposed the tax cuts, party leaders had put the issue behind them and would not call for repeal.
"I don't think you'll see an orchestrated effort to repeal the tax cuts because Bush has taken the issue off the table, so we don't consider it an issue. We don't see a lot of utility in raising it," said DNC spokeswoman Jennifer Palmieri.
Nevertheless, many top Democratic advisers are still trying to turn the administration's $1.35 trillion tax-cut package into an election year issue, arguing that the lower tax rates will hurt the government's future fiscal health and should be curtailed.
At an economic forum held this week by the Democratic Leadership Council, which counts many Democratic lawmakers among its members, former White House economic adviser Gene Sperling said that Democratic leaders should call for a freeze on any further tax cuts for the top 2 percent to 3 percent of taxpayers.
"Now is the time to have that debate," said Mr. Sperling, who was President Clinton's economic adviser and has been advising Senate Majority Leader Tom Daschle and other Democratic leaders on economic policy.
DLC Chairman Al From supported Mr. Sperling's call for resuming the tax-cut debate "to lay the groundwork for this fall." Mr. From charged that the economy was not as strong as it was in the late 1990s under Mr. Clinton "because the Bush administration has diminished the amount of fiscal discipline and is turning surpluses back to deficits."
"What Sperling is proposing is a tax on America's small-businessmen and entrepreneurs," White House economic adviser Lawrence Lindsey said yesterday. "Most of the [top tax rate] returns he is talking about report small business income directly on their personal taxes.
"I don't think that would be a constructive thing to do for the economy. Economic theory says that permanent tax cuts are what people respond to. So telling America's smallbusinessmen and women that you are going to legislate a tax increase in effect over what they expected would harm the economy," Mr. Lindsey said.
Anticipating that Democrats would be criticizing the tax cuts again, House Ways and Means Chairman Bill Thomas, California Republican, sent a two-page memo to all House Republicans last week saying that the economic recovery was "largely due to the major tax cut signed into law in June 2001."
Meanwhile, Republicans are planning a number of legislative actions and events over the next two weeks to further define themselves as the party of lower taxes and the Democrats as the party of higher taxes.
House Majority Leader Dick Armey, Texas Republican, has scheduled votes on two major bills, one that will make the Bush tax cuts permanent after this decade and another, "The Taxpayer Protection And Accountability Act," aimed at eliminating penalties for minor, unintended infractions of the tax code.
On April 15, Mr. Armey will hold a "town meeting" in the Cannon House Office building, where he and other lawmakers will meet with taxpayers from around the country to promote the tax rate cuts, IRA expansion, child tax credit and other provisions in last year's law.
The DNC, meanwhile, says it is planning to hold several dozen rallies at post offices around the country to demonstrate for "equal pay for equal taxes" for women, Ms. Palmieri said in a tongue-in-cheek remark.
"The goal is to reach out to working women who have a lot of demands on them and who do not vote as much," she said.

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