Bush Faults House GOP Spending Plan
By Terry M. Neal and Juliet Eilperin
Campaigning in California yesterday, Bush questioned a House leadership plan to save $8 billion over the next year by deferring tax credit payments for low-income people.
"I don't think they ought to balance their budget on the backs of the poor," said Bush, who has emphasized "compassionate conservatism" in his quest for the presidency. "I'm concerned for someone who is moving from near-poverty to middle class."
While Bush has generally been supportive of Republicans in Congress, including their push for a major tax cut this year, his comments yesterday signaled a new willingness to differ with the hundreds of GOP lawmakers who have enthusiastically endorsed his presidential candidacy.
Democrats clearly plan to try to tie Bush to the Republican-controlled Congress, whose popularity has suffered because of a reputation for harder-edged conservatism. Although his aides said no larger message was intended, the governor's comments yesterday underscored his intention to run a campaign supportive -- but independent -- of his allies in Congress.
Indeed, Bush's comments on the so-called earned income tax credit were strikingly similar to President Clinton's, who signed a temporary spending measure yesterday to keep the government open three more weeks while he and congressional Republicans try to work out a budget agreement for the fiscal year that begins today.
"Let me be clear: I will not sign a bill that turns its back on these hard-working families," Clinton said. "Delaying the earned income tax credit payment is more than a gimmick. It is an effective tax increase on the most hard-pressed working Americans."
At issue in the back and forth yesterday was a relatively minor part of the multibillion-dollar budget debate on Capitol Hill -- but one that carries some symbolic resonance. About 20 million low- and moderate-income working households receive annual lump sum refunds through the earned income tax credit.
As an effort to squeeze spending under tight budget restrictions, House GOP leaders want to shift $8.7 billion of the cost of the program from fiscal 2000 to 2001.
Under this approach, the Internal Revenue Service would delay the bulk of the earned income tax credit payments these families are owed, stretching the payments they would otherwise receive next spring over the following 12 months instead.
Proponents say that this move would bring the program in line with other government income support programs that make monthly installments to beneficiaries and make it easier for the government to monitor the program to cut down on waste and fraud.
However, the White House and Democratic critics warn that the change would delay getting money to families living on the edge of poverty. Moreover, the effects of inflation will erode the value of the money over time, they say.
Bush's comments on the issue caught House GOP leaders by surprise, as they were navigating the earned income tax provision through the House Appropriations Committee yesterday.
Rep. David R. Obey (Wis.), the ranking Democrat, gleefully interrupted the proceeding to read a wire service report of Bush's statement while Majority Whip Tom DeLay (R-Tex.), the leading House conservative, sat stony-faced. Obey then turned to the Republican members on the committee and said, as he pointed to DeLay: "You've got to decide who you want to follow today, that Texan or Mr. Bush."
Obey got his answer later in the day, as the Appropriations Committee voted 33 to 26 along party lines to approve the measure.
Asked for reaction to the Texas governor's decision to interject himself into the sensitive congressional deliberations, DeLay snapped, "It's obvious the governor's got a lot to learn about Congress."
Other House leaders issued more muted responses, suggesting they were simply trying to find ways to fund the government without dipping into the Social Security trust fund or raising taxes.
"It's a free country," said House Speaker J. Dennis Hastert (R-Ill.). "He is the governor of Texas. It certainly affects some of his people, and he has a right to speak out."
House Chief Deputy Whip Roy Blunt (R-Tex.), who serves as Bush's liaison to House members, noted that Bush supported the nearly $800 billion tax cut proposal passed by the House and Senate earlier this summer. "If Governor Bush was president we would have already had this budget balanced and we would have moved onto other things," he said.
Opponents of converting the earned income tax credit into monthly payments, on the other hand, seized on Bush's remarks as further evidence of why Congress should jettison the idea. They argue that spreading out the payments is essentially a punitive measure that punishes those who can least afford it, working families that earn less than $30,000 a year.
"I just don't think it's the right way to do things, and I'm glad he commented," said Senate Budget Committee Chairman Pete V. Domenici (R-N.M.). "I don't see how it can do anything but put another nail in its coffin."
Staff writer Eric Pianin and staff researcher Ben White contributed to this report.
© 1999 The Washington Post Company