Bush touts tax cuts to improve economy

Bush adviser says unemployment peaking

Bush touts his tax cut to employees at a heavy machinery service plant.

CHARLESTON, West Virginia (CNN) -- President Bush argued against a bid to delay $1.35 trillion in income tax cuts, a package he signed into law in 2001, on a trip to this city Tuesday.

"If you have more money, it means you're going to spend more," Bush told workers at Cecil I. Walker Machinery Co.

"And if you spend more, somebody’s going to have to make more of what you're spending it on, which means it’s more likely that somebody’s going to find work. That’s how the economy works."

Some Democrats favor postponement of the cuts to pay for government services such as health care and education.

Cecil I. Walker Machinery Co. sells and services heavy machinery in the state, where coal mining is a major industry.

Over the past year, West Virginia has lost 4,400 jobs, mostly in manufacturing, trade and construction. Its unemployment rate of 4.5 percent, however, is below the national rate of 5.8 percent, according to The Associated Press.

Bush's top economic adviser said the nation "may be very, very near the peak in unemployment" and that by the fourth quarter of this year the economy could be growing at a robust rate of 3.5 percent.

Larry Lindsey told CNN he expects small but positive growth in the first quarter of 2002. He said the "preconditions" exist for recovery, but the economy would be far better off if Congress passed an economic stimulus bill early this year, as President Bush is urging it to do.

Lindsey said passage of a stimulus bill could mean the difference between 2.7 percent and 3.5 percent growth in the fourth quarter.

"That's a big difference," he said.

Bush also touted his national energy plan, which has passed the Republican-controlled House but has yet to come to a vote in the Democrat-controlled Senate. The plan calls for increased reliance on technology designed to reduce pollution from burning coal.

"We need to use coal. We've got a lot of it and we need coal," Bush said.

"This nation wants an energy policy. This nation needs an energy policy. Jobs depend on affordable energy. If there’s a price spike or a disruption in supply, people might not have work."

He also spoke critically of government regulation, saying it stifled creation of jobs.

Bush called on Congress to give him new authority to negotiate global trade agreements.

"The more markets available for U.S. products, the more likely it is that more Americans are finding work," Bush said.