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Clinton Blasts Republican Tax-Cut Plans

The Budget

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  • By George Hager and Judith Havemann
    Washington Post Staff Writers
    Thursday, February 4, 1999; Page A8

    President Clinton yesterday attacked Republican tax-cut plans, using some of his strongest language to date to paint the proposals as a boon to the wealthy and to warn that the GOP would pay for those tax cuts by reducing spending on the nation's health care plan for the elderly.

    Without naming him specifically, Clinton blasted a plan released Tuesday by House Budget Committee Chairman John R. Kasich (R-Ohio) that calls for a 10 percent across-the-board tax cut. The proposal, one of several plans to be offered by congressional Republicans this year, "would benefit, clearly, the wealthiest Americans, who have, I might add, done quite well as the stock market has virtually tripled," Clinton told a meeting of the American Association of Retired Persons here.

    "It would do this before Medicare has been secured and in a way that would prevent us from spending" a piece of the surplus on bolstering the program, Clinton added, calling the Kasich plan "the latest in a rather long series of large and risky tax proposals."

    While senior administration officials and congressional Democrats have attacked GOP tax-cut plans as tilted toward the wealthy, yesterday's speech sharpened the partisan divisions on the subject by flavoring the debate with the tough, class-warfare-style rhetoric Democrats used to derail GOP budget and tax-cut plans in 1995-96.

    In his State of the Union address last month and in the budget he released Monday, Clinton proposed that the burgeoning non-Social Security budget surplus over the next 15 years be divided among Medicare, new 401(k)-style retirement accounts and spending on defense and domestic programs. Republicans have called for using the same money for tax cuts, chiefly the big, across-the-board cuts Kasich and others have backed.

    "What you have here is two completely different, fundamental points of view," said Bruce Cuthbertson, a spokesman for Kasich. "The president believes the surplus is the government's money . . . we believe the [non-Social Security] surplus is the people's money, and the people ought to be allowed to keep it."

    In the same speech to the AARP's National Legislative Council, Clinton laid down markers for the ensuing debate on overhauling Medicare, sending a signal to the 17-member bipartisan commission at work on a reform plan about what he will and will not accept.

    Clinton reiterated his proposal to devote some of the surplus to Medicare. He also called for a "modern, competitive" Medicare system, pointedly leaving open the door to a proposal by Sen. John Breaux (D-La.) that would restructure Medicare to add a component under which beneficiaries would get a set dollar amount for premiums and health care plans would compete for their business.

    But in an apparent critique of the Breaux proposal, Clinton insisted that any new plan offer "a defined set of benefits" without imposing "excessive new costs" on low-income beneficiaries. Critics have said Breaux's plan fails to specify a core program for health plans to bid on.

    Clinton also called for adding a prescription drug benefit to Medicare, financing it with savings from unspecified reforms to the program.

    Martin Corry, AARP director of federal affairs, said Clinton's proposal "advances the debate" but did not amount to a "bold breakthrough."

    Breaux praised the president for "focusing in on Medicare" and said his proposals are "not inconsistent" with those before the commission.

    Breaux was assailed yesterday by seven of the eight Democrats on the commission for "insufficient consultation and information" and was queried in detail about how his plan would work. The group, led by Rep. John D. Dingell (D-Mich.), suggested that without further information there was little need for next week's scheduled meeting of the commission, which is to present its final report in less than a month.

    © Copyright 1999 The Washington Post Company

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