President Reagan delivered a nationally televised appeal for his $98.3 billion tax bill last night, calling it a bipartisan compromise that is "a price worth paying for lower interest rates, economic recovery and more jobs."
In a speech carefully framed to avoid partisan attacks on the Democratic congressmen whose votes the president needs to pass the tax bill, Reagan acknowledged that it was unpopular with some members of his own Republican Party and that he had to "swallow hard" to propose the revenue increases. But Reagan said those in Congress who supported these tax increases also had compromised by accepting $280 billion worth of cuts in government spending to help reduce budget deficits.
"I am told by many that this bill is not politically popular and it may not be," Reagan said in a speech from the Oval Office. "Why then do I support it? I support it because it's right for America. I support it because it's fair. I support it because it will, when combined with our cuts in government spending, reduce interest rates and put more Americans back to work again."
House Majority Whip Thomas S. Foley (D-Wash.) described the measure in similar terms, emphasizing the unusual nature of the political coalition backing a presidential initiative which a number of Democrats support and many Republicans oppose.
"I support the revenue bill because it is fair and because it brings some long-overdue moderation to the administration's economic program," Foley said on behalf of the House Democratic leadership in a televised response to Reagan's speech.
But Sen. David L. Boren (D-Okla.), representing the Senate Democratic leadership, said the bill would not help economic recovery. He warned it will be difficult for many members of Congress to choose between its "good and bad provisions" when voting on it and a companion package of spending cuts later this week. House-Senate conferees shaped the final provisions of the tax bill early Sunday and agreed on the last of the spending cuts yesterday.
Reagan, whose support for tax reduction has been a cornerstone of his economic program, contended that the $98.3 billion in tax revenue increases "absolutely does not represent any reversal of policy or philosophy on the part of this administration or this president."
The only hint of criticism for Congress in the president's speech was a suggestion that the tax increases would not have been necessary if Congress had approved the spending cuts the administration proposed in its budget submitted last February.
Denying that his bill was, as it has been described, as "the largest single tax increase in history," Reagan said "possibly it could be called the greatest tax reform in history."
Reagan contended that more than 80 percent of the tax bill "is not new tax at all but is better collection and correcting of flaws in the system."
"This leaves $19 billion over three years of actual new taxes, which is far outweighed by the tax cuts which will benefit individuals," the president said. "There is an excise tax on cigarettes and telephones. For people who smoke one pack a day this will mean an increase of only $2.40 a month. The telephone tax increase is only about 54 cents a month for the average household.
"Right now, the tax reduction that we passed last year is saving the average family about $400 per year. Next year, even after this new tax bill is passed, the savings will almost double -- $788."
Reagan, who drafted his speech before House-Senate conferees completed work on what is now a $98.3 billion tax bill, referred to the measure throughout as "a $99 billion tax program."
The president made no mention of the estimated 5,200 increase in Internal Revenue Service agents that opponents of the bill say will be required to enforce compliance with the various provisions of the bill tightening provisions of the tax law.
In past appeals for public support directed at congressional passage of economic legislation the president has often criticized Congress and past Democratic policies. But this week the White House counts on only 80 to 90 of the 192 House Republicans for support and a majority of the House Democrats. As a result, Reagan eschewed his customary partisan appeal for a moderately toned "good government" appeal.
"You can't go slam bang against the Democrats and Congress when you're trying to win their votes," explained one administration official. "This was an effort to bring back some Republicans and leave room for the Democrats."
Administration political strategy is based in part upon a belief that many Americans are impatient both with the president and the Congress over the continued recession and the deepening unemployment and have little tolerance for partisanship from either side.
"What we need now is an end to the bickering here in the Capital," Reagan said. "We need the bipartisan comprehensive package of revenue increases and spending cuts now before the Congress to be passed."
Reagan also is sensitive about the "fairness" issue and the view of a majority of Americans, as reflected in many polls, that administration policies have been unfair to those with lower incomes. In his speech last night Reagan stressed the provisions of the package that benefit lower-income Americans.
"There is a provision in the bill for extended unemployment payments in states particularly hard hit by unemployment," Reagan said, referring to a provision that many Democrats made a condition of support. "If this provision is not enacted, two million unemployed people will use up their benefits by the end of March.
"I repeat: Much of this bill will make our tax system more fair for every American, especially those in the lower-income brackets."
At the same time he was extolling the measure, Reagan acknowledged that the bill contained both imperfections and provisions he didn't favor.
"Make no mistake about it, this whole package is a compromise," Reagan said. "I had to swallow hard to agree to any revenue increase. But there are two sides to a compromise. Those who supported the increased revenues swallowed hard to accept $280 billion in outlay cuts. Others have accepted specific provisions with regard to taxes or spending cuts which they opposed."
As he has in past televised appeals, Reagan urged viewers -- "whether you are a Republican, a Democrat or an independent" -- to urge their congressmen to support his program.
"The single most important question faced us tonight is: Do we reduce deficits and interest rates by raising revenue from those who are not now paying their fair share -- or do we accept bigger budget deficits, higher interest rates and higher unemployment simple because we disagree on certain features of a legislative package which offers hope for millions of Americans at home, on the farm and in the work place?" the president asked rhetorically.
Reagan's speech, which was responsive to Democratic insistence that the president publicly identify himself with the compromise if he wanted opposition support, was a major element of this week's White House drive to secure passage of the legislation. The president is also meeting with a variety of congressional groups -- so many, complained one skeptical administration insider, that he is "in danger of becoming a congressional relations officer."
The mood in the White House has become more optimistic than it was earlier, based largely on the belief that many Democrats will support a bill that contains provisions a number of them have advocated for many years. At the same time White House strategists are sensitive to continued opposition from many conservative Republicans who on past legislative battles have formed the core of Reagan's strength.
Reagan, who during the 1980 presidential campaign promised a much quicker economic recovery than has occurred, last night forecast a slow and steady improvement in economic conditions instead.
"The present recession is bottoming out without resorting to quick fixes," he said. "There will not be a sudden boom or upsurge. But slowly and surely we will have a sound and lasting recovery based on solid values and increased productivity and an end to deficit spending."