Bush Is Sounding Like a Candidate

President Bush carried his message of military victory and economic challenge to the job-blighted Silicon Valley on Friday, thanking defense workers for their contributions to the war with Iraq and pressing his tax cut plan as the cure for the region’s -- and nation’s -- economic ills.

“We’ve come through some hard times,” Bush told engineers and technicians at United Defense Industries, which makes combat fighting vehicles. “Remember, we’ve overcome a recession. We’ve overcome an attack on our soil. We have been in two major battles in the war against terror, one in Afghanistan, one in Iraq.”

As he gears up for his 2004 reelection campaign, Bush has been formulating a message that puts the blame for the sluggish economy and rising unemployment on outside forces and national security emergencies. But to call attention to his record on national security issues, Bush has been choosing defense-related settings for speeches on the economy.

Bush on Friday acknowledged the especially difficult circumstances in Silicon Valley, which he described as “this incredibly vibrant part of the American economy over the past years [which] is not meeting its full potential.”

The president’s visit came as the Labor Department in Washington announced a jump in the unemployment rate for April, bringing it to 6%. That tied the figure for December as the highest rate in almost nine years.

Bush noted the news and called it “a clear signal to the United States Congress we need a bold economic recovery package so people can find work.”

The president then devoted much of his speech to pushing for a tax cut of at least $550 billion, which he claimed would create 1 million jobs nationwide by 2004.

“The plan I just outlined is one that will boost the economy in the Silicon Valley,” Bush said. “It’s a plan that is bold because we need a bold plan. It’s a plan that is thoughtful because we need a thoughtful plan. Most importantly, it’s a plan that will invigorate the entrepreneur spirit, which has been so strong here, and make it more likely somebody who’s looking for a job will be able to find one.”

But Bush’s plan has run into resistance in Congress. The president initially proposed a $725-billion, 11-year tax cut plan to stimulate economic growth. House Republican leaders, responding to concerns about the mounting federal budget deficit, have reduced the plan to $550 billion. In the Senate, moderate Republicans have led the push to limit it to $350 billion.

“I know you’ll hear talk about the deficit,” Bush said. “And we’ve got a deficit because we went through a recession. A recession means the economy slowed down to the extent where we’re losing revenues to the federal treasury. We got a recession because we went to war, and I said to our troops, if we’re going to commit you into harm’s way, you deserve the best equipment, the best training, the best possible pay.”

The president also reprised the theme he laid out a day earlier in a national address from the aircraft carrier Abraham Lincoln off the coast of San Diego -- that the military conflict with Iraq was “one victory” in the war on terrorism that began after the 2001 attacks on America.

“On September the 11th, 2001, America learned that the vast oceans no longer protect us from the threats of a new era,” Bush said. “On that day 19 months ago, we also began a relentless worldwide campaign against terrorists and those who hate freedom in order to secure our homeland and to make the world a more peaceful place. And we’re making great progress.”

The defense sector is a bright spot in Silicon Valley, one of the most beleaguered regions of the state. According to Bureau of Labor statistics, the San Jose area has lost almost 16% of its workforce since Bush took office in January 2001, a total of about 175,000 jobs.

Nationwide, 2.7 million jobs have been lost since March 2001, when the recession began.

“The economy is not growing fast enough, and you know it as well as anybody here,” Bush said.

Democrats responding to Bush’s remarks pointed to the job-loss figures. “There continues to be serious question in his leadership on economic security issues,” said Sen. Jon Corzine (D-N.J.).

House Minority Leader Nancy Pelosi called on Bush to extend federal unemployment benefits in response to the rising jobless rate -- “a very fast way for us to inject purchasing power into the economy,” she said.

As president, Bush has been an infrequent visitor to California, which he lost to Democratic candidate Al Gore in 2000 by 14 percentage points. Bush’s trip was the sixth in his presidency and the first since Aug. 24. In contrast, Bill Clinton had visited California 17 times at this stage in his presidency.

Silicon Valley leans Democratic politically, but the choice of a defense industry plant ensured a warm and responsive crowd. The president spoke at a division of United Defense Industries, based in Arlington, Va., which makes ground combat systems such as the Bradley Fighting Vehicle, which was integral in Iraq.

Bush noted the 750-employee Santa Clara facility also makes the Hercules Tank Recovery Vehicle, which helped topple the statue of Saddam Hussein in central Baghdad.

“The guy with the sledgehammer on the statue needed a little help,” Bush said to laughter and cheers from the audience. “Thankfully, there was a Hercules close by.”

As he left Santa Clara, Bush was joined by Australian Prime Minister John Howard and his wife, who were to ride with him on Air Force One to his ranch in Crawford, Texas. Howard, who was a strong supporter of the president’s confrontation with Iraq, was to spend a night at the ranch -- an honor that has been reserved for foreign leaders closest to Bush.

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Times staff writers Joseph Menn in San Francisco and Nick Anderson in Washington contributed to this report.