Pocketbook issues fill election year

WASHINGTON -- To hear Senate Majority Leader Tom Daschle tell it, President Bush's 2001 tax cuts worsened the recession and closed out a short, happy era of budget surpluses. Republicans claim that's Democratic doublespeak for wanting to raise taxes.

Pick one side or the other. It's an argument the country will hear endlessly over the next 10 months as the parties clash over pocketbook issues in the run-up to midterm elections.

The debate got off to an early start this year, with Daschle attacking the economic policies of a president with approval ratings in the 80-percent range -- the downdraft of a recession overcome by patriotic backing for the war against terrorism.

Daschle speech

"They have one unchanging, unyielding solution that they offer for every problem," Daschle, D-S.D., said of Republicans Friday in a speech a few blocks from the Capitol, "Tax cuts that go disproportionately to the most affluent."

Those cuts "probably made the recession worse," he said, and are "the biggest reason" why the surpluses are vanishing. He also urged enactment of an economic stimulus and a longer term series of measures for economic growth, issues that have also proven to be areas of conflict between Democrats and the White House.

Other Democrats will follow Daschle's lead. House Democratic leader Dick Gephardt plans a speech for later in the month. Congress' two senior Democratic budget writers are expected to draw attention to newly revised, higher deficit projections in the coming days. And the Democratic National Committee intends to orchestrate a series of events in targeted states over the next three weeks to try and link Bush's economic policies to the forecast deficits.

For their part, Republicans have the White House, and the media coverage it commands.

Bush won't deliver his State of the Union address until Jan. 29, and his budget until several days later, the two events that customarily kick off Congress' annual clash over economics.

The president is expected to speak out on the economy over the next several days, and urge Congress to pass economic stimulus legislation when it returns to work.

"There are continuing concerns about layoffs and about further unemployment. So we feel that we need to act to make sure that we are going to recover quickly," White House counselor Karen Hughes said.

Overall, the initial response to Daschle from Bush's Texas ranch was mild, almost feigned shock that politics may be involved.

'Troubling rhetoric'

Spokesman Dan Bartlett said Daschle's speech contained "troubling rhetoric on increasing taxes and fingerpointing on the budget. ... It makes you wonder what are his ulterior motives and we hope it's not trying to start the election year too early."

Republicans in Congress, urged in strategy memos to depict Daschle as an agent of gridlock, said firmly the South Dakotan was looking for a tax increase.

"Perhaps the most important thing Congress did last year to promote economic security was to pass the president's tax relief proposal," said Speaker Dennis Hastert, R-Ill. "Senator Daschle voted against that proposal, and now he seems to indicate he wants to repeal it."

Actually, Daschle was mum on that question in his speech -- an issue that divides his caucus. Sooner or later, according to the Republican calculation, he's going to have to address it.

And sooner or later, Bush will take the opportunity to restate a position he articulated most clearly two years ago, while running for the White House.

Asked in campaign debate in New Hampshire on Jan. 7, 2000, whether he was willing to take the "no new taxes" oath his father took as a candidate and broke as a president, Bush went one step further. "This is not only no new taxes, this is tax cuts, so help me God," he said.