Clinton: Plan To Scrap Tax Code Reckless, Irresponsible
By John King/CNN
WASHINGTON (March 2) -- President Bill Clinton delivered a warning to congressional Republicans Monday that "an irresponsible scheme" to scrap the income tax code would undermine the nation's strong economic growth.
"The scheme to abolish the tax code could threaten nearly every American family's best laid plans for the future," Clinton told the Mortgage Bankers Association.
"We have to continue to be open to changes in the tax law and in the way the IRS operates and in all these systematic things that we have to continue to modernize. Of course we must. But we mustn't buy a pig in a poke. We have to continue to proceed with discipline," the president said.
Republicans pushing the legislation, led by Senate Majority Leader Trent Lott (R-Miss.) want to sunset the current IRS code by 2001, arguing such a drastic move would force lawmakers to make decisions on a replacement. The GOP is divided over whether the new system should be flat tax, a national sales tax and other proposals.
Clinton admitted that on the surface the idea seemed "almost irresistible. But so was the Siren's song." A replacement code must first be in place and explained in detail to the American people, Clinton argued.
Because people would not know what tax incentives would be included under a new system, "Scrapping the home mortgage deduction, scrapping other middle class tax cuts, without presenting a clear alternative, is simply reckless for the economy, reckless for businesses, reckless for families' budgets." the president said.
Clinton said he would veto any such legislation if it passed: "I will not permit it if I can stop it, but it shouldn't pass in the first place."
A key supporter of the GOP plan, Lott said it would be a "forcing event."
"It would force the Congress and White House to act, to replace the tax code. If we don't create a deadline, it will be much harder to make tax reform happen. Clearly, the president needs to be forced to consider fundamental reform, just like he needed to be forced to fix the IRS," Lott said in a written statement released Monday afternoon.
Clinton's speech was designed to frame the 1998 midterm election year debate over taxes just as Congress begins to consider budget, taxes and other economic issues.
Defending his policy for targeted tax cuts for education, child care and other domestic spending priorities, Clinton said, "There is a right and a wrong way to do reform. And the right way must involve our continued commitment to fiscal discipline, to investing in our people, and to making the future a
predictable and confident one in terms of our economic policy."
Clinton also touted new government figures showing personal incomes are on the rise.
CNN's John King contributed to this report.