Bush, McCain Tax Fight Intensifies

George W. Bush and John McCain escalated their attacks on each other’s tax plans Saturday as the Republican presidential candidates met in their final debate before the Iowa caucuses nine days from now.

Opening a new front in their intensifying argument over taxes, Bush criticized McCain for proposing to tax certain fringe benefits, such as education and meal subsidies, that companies provide their workers. “It is a $40-billion tax increase,” Bush declared.

McCain fired back that his tax cut plan would provide greater relief for middle-income families than Bush’s and accused the governor of attempting a “Texas two-step” in claiming that he was setting aside enough funds from the surplus to stabilize Social Security.

“When you run ads saying you’re going to take care of Social Security, my friend, that’s all hat and no cattle,” McCain charged.

Late in the debate, Steve Forbes jumped on the pile from the right, deriding McCain and Bush as “timid tax cutters” whose tax cut proposals are too small. Forbes also attacked Bush’s claims of cutting taxes in Texas, saying most families had not seen any reductions.

“That’s a Clinton tax cut. . . . Raise the taxes and call it a tax cut,” Forbes said.

After the debate, McCain’s campaign issued a statement accusing Bush of misrepresenting his proposal on fringe benefits--which is one of many tax “loopholes” McCain has proposed closing to fund the $237-billion, five-year tax cut he recently unveiled. McCain’s campaign acknowledged the proposal would tax certain fringe benefits companies now provide but said the total cost was not as large as Bush asserted and that education benefits would not be taxed.

Notwithstanding the sparks over taxes, the debate was surprisingly tame--especially given the stakes for the Republican candidates. Several recent polls show Bush holding a substantial lead in the caucuses, which will formally open the presidential nominating season Jan. 24; Forbes is running a distant second, with Gary Bauer, Alan Keyes and McCain, who is not formally competing here, all clumped just under 10%.

Despite the generally genteel tone, the debate did produce some sharp exchanges. Two of the most charged came between Keyes and Bush.

Keyes, a former ambassador and the sole African American in the field, pointedly asked Bush about comments last week by a South Carolina state senator, Arthur Ravenel Jr., attacking the National Assn. for the Advancement of Colored People. The NAACP has boycotted South Carolina over its practice of flying the Confederate flag at the state Capitol; Bush has repeatedly refused to express an opinion on whether the state should take down the flag.

Ravenel, a flag supporter, described the NAACP as the “National Assn. of Retarded People.” When asked about Ravenel’s comments in South Carolina last week, Bush termed them “unfortunate” but did not call on the senator to apologize.

Pressed by Keyes on Saturday, though, Bush went further in denouncing Ravenel.

“His comments are out of line and we should repudiate them,” Bush said.

A moment earlier, Keyes accused Bush of standing by while a small town in South Texas, El Cenizo, passed an ordinance requiring that all town business be conducted in Spanish. What followed was a slightly surreal exchange as the candidates competed to display their mastery of Spanish.

Bush began by denying the charge: “No es la verdad,” he said, meaning that it wasn’t true.

“Es la verdad, senor,” Keyes jumped in.

“Un momento,” Bush said, trying to halt the interruption.

Finally, jumping on the linguistic bandwagon, McCain urged the two to move on: “Vamonos.”

For the record, Bush said he opposed the town conducting official business in Spanish and, turning to the broader issue of bilingual education, supported what he called “English plus”: teaching English but allowing students to maintain their native languages.

Much of the debate saw the candidates striking similar notes on an array of domestic issues. On agriculture, they exchanged promises to help family farmers by expanding markets abroad, eliminating the inheritance tax and restructuring federal price supports for family farmers.

On health care, the candidates echoed each other in insisting that the key to reform is to provide individuals with greater choice through programs such as medical savings accounts; several called for converting Medicare and Medicaid, the major federal health care programs, into vouchers that recipients can use to buy private insurance. Bush used some of his strongest language yet in insisting that he would reform the giant Medicare program for the elderly along such lines.

“It is a plan that is inefficient, it is a plan that is antiquated, and what our government must do is empower our seniors to make choices for themselves,” Bush insisted. “Should I become the president, reforming Medicare and Social Security are going to be a primary objective of mine.”

On education, all promised to reduce Washington’s influence, to promote school vouchers and to give states federal block grants to use as they see fit. Forbes, who received endorsements earlier in the day from two conservative education activists in Texas, criticized a pillar of Bush’s education program, though strangely Forbes never explained that it was the Texas governor’s idea he was denouncing.

The candidates also unleashed some of their sharpest criticism yet of President Clinton’s record and morals. Sen. Orrin G. Hatch of Utah denounced the administration as “the most deceitful and corrupt in our nation’s history.”

Amid all of these disparate exchanges, taxes once again produced the most heated moments in the 90-minute encounter. The accusations flowed in several directions.

Conservative activist Bauer denounced the provisions in Forbes’ flat tax that would eliminate the deductions for mortgage payments and charitable donations and said it would provide excessive benefits to business. And touting his competing flat tax proposal, Bauer criticized Bush for not proposing more fundamental restructuring of the code.

Passive for most of the debate, Forbes stirred toward the end with his accusation that the Texas tax cuts Bush passed in 1997 and 1999 had not provided real relief to many families. “Most Texans have never seen those tax cuts,” Forbes insisted.