Clinton's Budget To Feature Billions In Middle-Class Breaks
Money All The Talk On Weekly Talk Circuit
WASHINGTON (AllPolitics, Feb. 2) -- President Clinton will roll out a budget this week with $98 billion in tax cuts and the goal of a balanced bottom line by 2002, administration officials said today.
The tax cuts are designed to encourage education and home ownership, said Franklin Raines, director of the Office of Management and Budget.
"It's going to be a very targeted tax cut program that I think is going to make a meaningful difference for American families," Raines told NBC's "Meet the Press" program.
The proposals would include a $1,500 tax credit for college tuition and an extension of the capital gains tax exclusion on home sales to $500,000 per couple, Raines said.
Treasury Secretary Robert Rubin had the message to deliver.
"It focuses predominately on middle income tax cuts for education, and for child care and for savings," Rubin said on ABC's "This Week."
Administration officials have indicated the tax cuts would be partly offset by about $80 billion in revenues, including restoring an expired airport excise tax and closing corporate tax loopholes.
The real test of the president's fiscal 1998 budget, covering the year beginning Oct. 1, comes Thursday, when Clinton sends his proposal to Congress.
Republican leaders made accommodating noises.
"We're going to take the president's submission as a serious proposal, and we're going to see where we can go and how we can work with the White House and the Democrats," House Majority Leader Richard Armey (R-Texas) said on CNN's "Late Edition." (128K/10 sec. AIFF or WAV sound)
Sen. Pete Domenici (R-N.M.) indicated Republicans were willing to work with the White House.
"We ought to accept it as a major effort on the part of the president and say to the American people that we are willing to work from it," Domenici said after appearing on NBC.
Balanced Budget Amendment Jitters
On a related front, the proposed balanced budget amendment, an idea enjoying renewed life in Congress, still appears far from a done deal despite Republican optimism.
"I think that we have an excellent chance of passing a constitutional amendment to a balanced budget," said Senate Majority Leader Trent Lott. "I think we need it to actually get a balanced budget."
House Minority Leader Richard Gephardt was more measured.
"I think if you get an amendment that exempts those two things, Social Security and a capital budget, you have an amendment that is workable," Gephardt said. "That will not be harmful in case you get into a recession."
Raines, in turn, came out against requiring a balanced budget by law, which could limit the government's ability to respond to financial gyrations.
"We think that it's unwise to put into the constitution a mechanism that enshrines for all time a particular way of measuring the budget," Raines said.
About That Welfare Reform
Facing opposition by Republican governors to suggested adjustments to the landmark welfare reform passed last year, White House Chief of Staff Erskine Bowles defended President Clinton's position.
Bowles, after addressing the National Governors' Association, said the White House wanted to restore some welfare benefits to legal immigrants, but conceded that may be difficult.
"He was very clear when he decided there were three basic areas where felt there needed to be some change," Bowles said. "First in the area of legal immigrants, second in the area of food stamps and third to give the governors some more flexibility."
Lott argued for a wait-and-see approach.
The Democratic governors advocating reform may have their work cut out for them. Even Gephardt counseled caution.
"I think now that it's passed, we need to let it go into being and then see the problems and then try to fix them," Gephardt said.
The governors, attending their conference in Washington, have separate meetings Monday with Clinton and Lott.
Correspondent Anthony Collings contributed to this report.
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