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Clinton: 'This tax cut will not become law'
August 7, 1999 WASHINGTON (AllPolitics, August 7) -- President Bill Clinton says he will veto the Republicans' $792 billion tax cut plan, because it fails to protect Social Security, Medicare, and other national programs.
Members of Congress were heading home for summer recess Saturday; the respite gives Republicans a month to strategize before returning to the hill, and facing the president's opposition. "Because this tax cut will not save and strengthen Medicare, because it will not add a day to the Social Security trust fund, because it will not pay down the debt and pay it off for the first time in 150 years, this tax cut will not become law," Clinton said on Friday. The massive tax cut would damage the nation's economic future, Clinton said before departing for a weekend in Arkansas. The Republican-controlled Congress approved the 10-year tax-cut proposal late Thursday. The House passed the plan 221-206, while it barely passed in the Senate by a 50-49 vote. 'Marriage penalty' relief proposed"When you go through the list of things that are achieved in this tax relief package, it does an awful lot for the American dream. It means that every working American that pays taxes will be able to keep a little bit more of their money in their pocket and decide how they will use it," said.Senate Majority Leader Trent Lott (R-Mississippi). The bill would trim the bottom 15 percent income tax rate to 14 percent in 2003 and reduce the other rates by 1 percentage point in 2005. Relief from the "marriage penalty" that affects millions of two-income couples would begin in 2001. The estate tax would be repealed gradually starting in 2003, and capital gains taxes would be cut from 20 percent to 18 percent for most investors retroactive to January 1, 1999. There are breaks for education and health care, expanded IRAs and pensions, and a legion of breaks for businesses large and small. Clinton said the Republican plan could be costly if it leads to higher inflation and interest rates. "If you get a tax cut today and the tax cut causes higher home mortgage rates, higher car payment rates, higher credit card rates, higher college loan rates and a weaker economy, then it won't take long for that tax cut to disappear in the flash of an eye," the president said. Willing to negotiateHe favors a $250 billion tax cut made up primarily of subsidies to retirement savings accounts. On Friday Clinton said he would be willing to negotiate the form of any tax cut, as long as it was affordable. "The amount should be determined not by politics, but by arithmetic," he said During the Congressional recess, which began Thursday night, Republicans are hoping to build support for the measure in their home states, to put pressure on the president. Lott said public support for the measure might encourage the president to change his mind. "Individuals and families are due a refund, and that is exactly what we do with this legislation," said Sen. William Roth (R-Delaware) chairman of the Senate Finance Committee. "Government is not automatically entitled to the surplus." Democrats, however, claimed that Republicans are motivated by a desire to curry favor with business and conservative political supporters. The Associated Press and Reuters contributed to this report. |
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