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GOP to press ahead with tax cuts, despite Clinton veto threatModerates urge both sides to do more to avoid standoff
August 1, 1999 WASHINGTON (AllPolitics, August 1) -- Republican congressional leaders hope to hammer out a tax cut bill this week before leaving for their August recess, despite President Clinton's promise to veto any measure that approaches the nearly $800 billion in cuts approved by the House and Senate. If the talk on the Sunday news shows is any indication, GOP leaders and the White House remain far apart, with moderates in both parties expressing frustration that the two sides seem more interested in a political showdown than a compromise. "It's a shame," said Sen. John Chafee (R-Rhode Island), who predicted that a presidential veto of the GOP plan would be sustained. "So in September, we'll be exactly where we are now, which seems to me to be a real pity." A member of Clinton's own party, Sen. John Breaux of Louisiana, said the president should gather together congressional leaders this week "and ask if they can seriously reach an agreement or compromise." "Both parties have taken a position of 'do it my way or don't do it at all.' Some people think that's a great political issue. I think we're arguing about failure," Breaux said on ABC's "This Week" program. "Only here in Washington can we not figure out what to do with $1 trillion in surplus."
The House and Senate have passed separate proposals that would use part of projected budget surpluses to cut taxes by $792 billion over the next 10 years. The task this week is to hammer out differences between those two plans. Last week, the Senate defeated a compromise plan pushed by Breaux that called for $500 billion in tax cuts. Clinton has vowed to veto any tax cut in excess of $300 billion, insisting that the Republican plan is fiscally irresponsible and doesn't do enough to shore up Social Security and Medicare and pay down the national debt. Gene Sperling, Clinton's chief economic adviser, said the spending figures in the Republican bill "don't add up" and are based on projections of surpluses that might not come to pass. "Let's keep our economy strong, let's keep our interest rates low. That's the smart thing to do. And, if things work out better in the future, then we'll have more money for a tax cut," Sperling said on CNN's "Late Edition." Sperling also indicated that if a compromise tax cut figure can't be reached, the White House would prefer no tax cut at all. "It would be better to do nothing and pay down $100 billion of our national debt than to sign a large and irresponsible tax cut that would signal to the world that the era of fiscal discipline in the United States is over," Sperling said on NBC's "Meet The Press."
But Republicans counter that their plan protects Social Security and Medicare while also paying down the debt and providing relief to taxpayers who created the surplus in the first place. Senate Budget Committee Chairman Pete Domenici (R-New Mexico) said White House claims that surpluses aren't large enough to adequately cover those programs and provide a tax cut are "poppycock." GOP leaders also accuse Clinton of wanting to spend the surplus on a variety of new programs that would expand Washington's power. "Does anybody think this president is not going to spend this surplus? It's almost like 'anything but tax cuts' seems to be what the motto is up here," Domenici said on "Late Edition." "I don't think that is the right way to treat the American people." Sen. Phil Gramm (R-Texas) says Republican and the White House are "much further apart than the public understands" because Clinton's tax cut doesn't provide relief to those who pay the bulk of federal taxes -- something he says the GOP plan does. "The reality is (Clinton's) so-called tax cut is basically giving money to people who largely don't pay taxes, so that it's really spending rather than a tax cut," Gramm said on "This Week."
Domenici said he sees room for a "grand compromise" on a plan to spend the budget surplus -- but only if such a plan begins with what he termed "a very major" tax cut. "If (Democrats) won't want to start with that, then we will have gridlock on their terms. It will be their fault," he said. Some political analysts are predicting that the partisan battle over tax cuts could lead to a larger train wreck this fall when it comes time to approve spending bills. That could lead to another government shutdown -- something politically risky for both parties. Reporter Kathleen Koch and The Associated Press contributed to this report, written by Richard Shumate. |
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