- The Washington Times - Tuesday, January 7, 2003

WASHINGTON, Jan. 7 (UPI) — Incoming Finance Committee Chairman Sen. Charles Grassley, R-Iowa, said Tuesday it was unlikely that even a Republican-controlled Congress will pass President George W. Bush's economic recovery plan unchanged.

Though the initial reaction Tuesday to Bush's $674 billion, 10-year stimulus package was predictably partisan, with Senate Minority Leader Tom Daschle, D-S.D., calling it "misguided" and some Republicans lauding it, Grassley seemed to be predicting the most likely debate.

Grassley said he "will apply three tests to the president's proposal and others. One, will it be effective, creating the maximum number of jobs and getting the most bang for the buck? Two, will it work right away? And three, will it get enough bipartisan support to pass a closely divided Senate."

A well-placed Senate aide, who asked not to be identified by name or title, said the forthcoming battle over the plan "will be fought not with the leaderships, but between the Senate moderates."

Despite the fact that the Republicans control both houses of Congress, this aide said, the president's sweeping plan needs sufficient votes in the Senate to make moderates on both sides of the aisle more important than the leadership. The votes of Sens. John Breaux, D-La., and Zell Miller, D-Ga., will count more than the Democratic leadership, as will the votes of Republican moderates like Sens. John McCain, R-Ariz., and Olympia Snow, R-Maine, he said.

Grassley's statement hints at that: "The winning formula might be the president's proposal, or it might be parts of the president's plan and proposals from some of my colleagues."

In an address in Chicago, Bush offered a plan calling for ending taxation of stock dividends to shareholders, acceleration of the tax breaks in the 2001 tax reduction law, higher depreciation levels for business to write off equipment and plants, and individual tax breaks for married couples and families with children.

At the last minute, Bush added an innovative $3,000 "re-employment" account for those likely to exhaust their unemployment benefits. The money, part of a two-year, $3.6 billion program administered by the states, could be used for retraining, childcare, transportation expenses and other costs involved in job searches. Those who managed to find work within 13 weeks would be allowed to keep whatever is left over from the stipend.

The plan was added after the Democrats aired a $136 billion plan on Monday and criticized Bush's proposal for favoring the rich.

The Democrats and labor unions have attacked Bush's plan as favoring the rich over the working class, but the debate on Capitol Hill may be drawn on other issues.

The impact of Bush's plan on accelerating the federal budget deficit has made some in Congress on both sides of the aisle anxious. Rep. John Spratt, D-S.C., said the Bush plan could raise the national debt to a trillion dollars.

Another battleground is expected to emerge over how little the president provides to assist states burdened by budget deficits. Democratic New Mexico Gov. Bill Richardson said that on Thursday, the Democratic governors will present their ideas for restarting the economy and the Republican governors also have a separate plan.

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