- The Washington Times - Wednesday, February 26, 2003

New Mexico's governor warned fellow Democrats yesterday they face defeat in elections next year if party leaders do not stop bashing tax cuts and waging class warfare.
"Unless we get away from this class warfare argument, we're going to lose," said Gov. Bill Richardson yesterday as the nation's governors were wrapping up their four-day winter meeting in Washington.
"Democrats have to fashion a message of economic growth. It can't be a negative message. It has to be an optimistic message of hope and opportunity," he said.
"I believe the Democratic Party has to be open to tax cuts and economic-growth incentives," he explained later in an interview with The Washington Times. "Democrats have to stop this reflex opposition to tax cuts. We've got to be more pragmatic."
Mr. Richardson, an ambassador to the United Nations under the Clinton administration, is cutting state tax rates by up to 40 percent to spur economic growth and jobs. He concedes he is out of step with his party's leadership and its presidential contenders about tax cuts. Almost all of the party's White House aspirants are calling for repealing most or all of President Bush's tax cuts to reduce the deficit and increase spending for social welfare programs.
That was the party's message last week at the Democratic National Committee meeting, where all of its presidential candidates tore into the tax cuts as giveaways to the rich. House Minority Leader Nancy Pelosi, who gave the keynote address at the start of the meeting, said Mr. Bush's tax cuts "largely benefit the wealthy" and "will not create any jobs."
Mr. Richardson delivered the warning to his party at a breakfast meeting with reporters that was sponsored by the Christian Science Monitor. Four other Democratic governors also attended, including Janet Napolitano of Arizona, Tom Vilsack of Iowa, Edward G. Rendell of Pennsylvania and Gary Locke of Washington.
Mr. Richardson was the only Democrat at the breakfast who urged his party to abandon its rhetoric against tax cuts.
The governors, most of whom are struggling to close large deficits as a result of reduced tax revenue from the economic slump, said they had to make difficult choices in spending cuts. They called on the administration to increase aid to pay for Mr. Bush's education reforms, rising Medicaid costs and homeland security initiatives.
"There's a strong possibility that I'll have to raise taxes" to cover growing education costs, Mr. Rendell said.
The governors expressed skepticism about the administration's plan to turn over the Medicaid program to the states with block grants to run it, though they like the increased freedom they would have to innovate and reform the program without seeking federal waivers.
"The flexibility and so forth, there's some attraction there," Mrs. Napolitano said.
Several said they were faced with the politically unpalatable task of possibly cutting Medicaid health care options for the poor to balance their budgets.
"I'm not sure we'd be having this conversation [about spending cuts] if the tax cuts were not passed as they are," Mr. Vilsack said.
Mr. Locke said he would prefer to scuttle Mr. Bush's plan to eliminate the dividends tax and use the revenue for increased spending for "education, transportation and public works projects to create jobs."
Asked if they believed that Mr. Bush can be beaten next year, all said it was possible. However, "it would be an uphill climb," Mr. Richardson said.

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