- The Washington Times - Saturday, January 11, 2003

Senate Democrats again criticized President Bush's $647 billion tax-cut plan yesterday, saying it would lead to "fiscal Armageddon," is not conducive to economic growth, and suggested Federal Reserve Chairman Alan Greenspan should resign his post if he doesn't agree.

Mr. Greenspan, whose management of the monetary system and economic opinions have been praised by Democrats and Republicans alike for more than a decade, was challenged by Sen. Mark Dayton, Minnesota Democrat, to "tell the American people the truth" about what he sees as the harmful effects of Mr. Bush's stimulus package.

"I've seen [Mr. Greenspan] for the last two years dancing around the head of a pin while the [Bush] administration violates every admonition he made to Congress under the previous administration," Mr. Dayton said. "And I think if we're going to get another spate of that kind of mealy-mouth equivocation with him, he ought to have the integrity to resign, because we need to tell the American people the truth about these policies."

Mr. Bush's tax plan includes an acceleration of his 2001 tax cuts, allowing 92 million taxpayers to keep an average of $1,083 more of their income this year. It also raises the child tax credit to $1,000 from $600 and eliminates the so-called "marriage penalty" by increasing the standard deduction for couples to twice that for single filers.

The president said that under his new tax plan, a family of four making $40,000 annually would see their federal income taxes drop from $1,178 a year to $45 a year. But Mr. Dayton said such examples don't tell the whole truth about who really benefits from the president's tax policies.

"Combine those two tax proposals, the 2001 and the 2003, that's $144,600 average tax cut per year to the wealthiest 1 percent of the people in this country," Mr. Dayton said.

Rep. Patrick J. Toomey, Pennsylvania Republican and an investment banker before entering politics, said the Democratic opponents of the president's tax proposal have two goals: "increasing government spending and income redistribution, and neither of these are going to stimulate economic growth."

Sen. Charles E. Grassley, Iowa Republican and incoming chairman of the Senate Finance Committee, has said he expects a scaled-back version of Mr. Bush's tax plan to be approved this year, though it might not happen until the end of the year when it can be folded into a filibuster-proof budget-reconciliation bill.

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