Bush Chides Senate, Urges Tax Vote

President Bush pressured Senate Democrats on Saturday to back a proposed economic stimulus bill that includes a tax cut for Americans with the highest incomes, saying the delay is causing more workers to lose their jobs.

“I call on the leadership of the Senate to bring this bipartisan economy recovery plan to a vote,” the president said in his weekly radio address. “While the Senate has failed to do its work, more and more Americans have been thrown out of work.”

The White House Council of Economic Advisors released a study Saturday estimating that the economy will generate 300,000 fewer jobs in 2002 if Congress does not pass the administration’s stimulus plan.

On Capitol Hill, negotiations continued Saturday, with lawmakers in both parties saying they still hope to reach a compromise before Congress adjourns for the holidays.

In late October, the Republican-led House narrowly passed a bill that features tax breaks for businesses. Its most controversial provision would refund hundreds of millions of dollars in taxes that some corporations have paid since 1986. One of the main beneficiaries would be Enron Corp. of Houston, which has filed for bankruptcy protection.

The stimulus plan under consideration in the Democratic-led Senate is targeted more at individuals. But Democrats and Republicans continue to disagree over the details.

Each side has signaled a willingness to include rebates of $300 to $600 for workers who did not receive refunds earlier this year because they had no income tax liability. Bush has gone along with a Democratic proposal to add 13 more weeks of unemployment benefits for workers who lost their jobs since the recession began.

Senate Democrats also want to include money to subsidize health insurance for the unemployed.

“Helping laid-off workers isn’t just the right thing to do; it’s the smart thing to do,” said Senate Majority Leader Tom Daschle of South Dakota, who delivered the Democratic rebuttal to Bush’s radio address. Those families, he said, are almost certain to pump the money back into the economy.

“Our Republican friends have a different idea,” Daschle said. “They think the way to help the economy is to get billions of dollars in new tax cuts for wealthy individuals and profitable corporations in the hope that the money will trickle down to working families.”

The president said the accelerated tax cuts would mostly help middle-class families.

Under the tax cut bill passed earlier this year, the 27% income tax rate was scheduled to be reduced to 25% in 2004. Under the GOP plan backed by Bush, that lower rate would kick in next month.

An analysis by the accounting firm of Deloitte & Touche said such a rate reduction would benefit married couples whose income is more than $65,550 a year. The maximum tax cut would reach $1,323 for joint fliers who have a yearly income of more than $158,000.

The Congressional Budget Office described the proposed rate reduction as benefiting the top quarter of those who pay income tax.

Last week, Daschle offered an alternative that would declare a one-month holiday from Social Security and Medicare payroll taxes as part of the stimulus package. Analysts said this idea, if adopted, would provide slightly less tax relief for middle- and upper-income Americans than the GOP rate-cut plan.