With a vote on a major GOP tax-cut plan looming in the Senate this week, top administration officials yesterday said President Clinton would veto a proposed compromise, viewing it as still too large a cut to allow the government to pay down the national debt and meet other priorities.
Interviewed on separate television talk shows, Treasury Secretary Lawrence Summers and National Economic Council Chairman Gene Sperling said Clinton refused to split the difference between a Republican plan for a tax cut of nearly $800 billion over 10 years and his own proposal for a $250 billion reduction.
In a vote that broke largely along party lines, the House last week passed a bill that provides for tax cuts totaling $792 billion. On Wednesday, the Senate is scheduled to take up a version that matches the size of the tax cuts in the House bill but contains some variations on how they are achieved. Some lawmakers from both parties have suggested a compromise in the range of $500 billion.
"The president will veto that $800 billion bill," Summers said on CBS's "Face the Nation." "The president will veto a $500 billion tax cut because it doesn't leave room for what's necessary."
On "Fox News Sunday," Sperling said, "A tax cut that is $800 billion or $500 billion is an irresponsible tax cut that would threaten our ability to pay down the debt, secure Medicare, Social Security and education." He said the GOP plan would leave no money to ensure the solvency of Medicare and would lead to "very serious cuts in everything from education to public safety."
Appearing on the same program, Sen. Phil Gramm (R-Tex.) said, "You guys are shameless, shameless." He denounced the White House plan as "fraudulent," telling Sperling, "It's like everything else you all do. It is totally dishonest."
The battle over the airwaves revolves around what to do with a projected budget surplus of $1 trillion over the next 10 years. The Republicans want to give the bulk of it back to taxpayers through tax cuts. The administration wants to set aside most of it to eliminate the national debt by 2015, save Social Security and Medicare and fund major domestic priorities.
Sen. John Breaux (D-La.), who has angered the White House by proposing a compromise tax cut of about $500 billion, urged both sides to take a break during the August congressional recess to "cool off," then negotiate a package in September.
"If we don't get together, we're headed for a major train wreck, which I think would be terrible for the American people," Breaux said on "Face the Nation." "Here we have a trillion-dollar surplus, and the two political parties in Washington can't figure out what to do with it. Only in Washington could you have that type of problem."