President Talks Up Tax Cuts in Iowa

After enduring days of controversy about his anti-terrorism precautions and the war in Iraq, President Bush on Thursday returned to a state he narrowly lost in 2000 and to a favorite subject that has been overshadowed recently: his support for tax cuts.

The president, keying his comments to the April 15 tax-filing deadline, told a friendly audience of dark-suited Midwestern bankers that the three years of tax reductions he championed have helped revive an economy hurt by recession, corporate scandals, the Sept. 11 terrorist attacks and the war in Iraq.

“Tax day is something most people really don’t look forward to,” Bush said. “But this year, it’s a little better because of the tax relief we delivered. And the economy is stronger for it.”

He also repeated calls for Congress to permanently extend portions of the cuts that are due to expire. “Tax relief today, and not tax relief tomorrow,” Bush said.

His comments drew a challenge from Sen. John F. Kerry, the presumed Democratic nominee for president, who said people were paying more tax under Bush’s policies because of increases in state and local taxes to fund federal mandates.

“Today, tax day, when people pay their taxes, I want them to know that they’ve been bushwhacked,” Kerry said at Howard University in Washington.

Kerry also said his own plans for tax credits for college tuition and healthcare, as well as corporate tax cuts for companies that keep their operations in the U.S., would amount to a bigger break for many Americans.

“I’m going to provide $225 billion more in tax cuts for the middle class than George Bush ever dreamed of,” the Massachusetts senator said.

The tax debate comes at a time when Americans are less angry than usual about their tax burden, according to a recent Gallup Poll.

The survey, conducted this month, found that 50% of people felt their federal income taxes were too high, a relatively small proportion. The polling group said that in nearly 60 years of surveys, it had seen only four occasions on which a smaller percentage of people said they were paying too much in taxes.

In the poll this month, 43% said their federal income tax burden was about right and 3% said it was too low.

Although Bush frequently promotes his tax cuts, a poll conducted for Associated Press last month found that most people did not think their taxes had decreased during the last three years. Twenty-five percent said their federal taxes had gone up in that period, and 43% said they had stayed the same.

In addition to highlighting his record on taxes, Bush’s trip Thursday aimed to shore up support in Iowa, a state he lost to Democrat Al Gore in 2000 by just 4,100 votes.

But Democrats are on a bit of a roll in Iowa.

The state’s marquee political figure, Tom Vilsack, became Iowa’s first Democratic governor in 30 years when he was elected in 1998. He was reelected in 2002 as part of a Democratic sweep in the state, and he is often mentioned as a potential running mate for Kerry.

Bush is lagging in polls in the state. That may be partly the result of a year of Democratic caucus campaigning by as many as 10 presidential candidates, who slammed Bush as much as they competed against one another.

Republican strategists say Bush can still find support in Iowa’s largely agricultural and small, family-oriented communities.

Bush mentioned local issues many times Thursday, using the words “rural America” at least 40 times in a 47-minute speech and speaking favorably about ethanol, a corn-based fuel.

Republicans also draw hope from the results of this year’s Iowa caucuses not because of Kerry’s victory there but because of the fourth-place finish of Rep. Dick Gephardt (D-Mo.). That is evidence, they say, of the dwindling power of organized labor in mobilizing voters and campaign workers.

Though Bush cited Iowa’s relatively low unemployment rate -- 4.1% -- as a sign of a healthy local economy, Vilsack, the Democratic governor, said later that the rate was below 3% before Bush took office.

“I don’t see it,” Vilsack said of the recovery cited by Bush. “We’ve lost lots of manufacturing jobs, and people are worried.”

In a separate effort to highlight the president’s tax cutting, the Bush campaign Thursday sent an e-mail to supporters featuring a photograph of Kerry with his Massachusetts colleague, Sen. Edward M. Kennedy. A headline on it read, “If you need a good reason to support President Bush, here it is.”

The e-mail noted that both Kerry and Kennedy voted against Bush’s tax cuts.

The Iowa speech came after a grueling week in which violence flared in Iraq and an independent commission raised new questions about the Bush administration’s anti-terrorism efforts before the Sept. 11 attacks.

Times staff writer Matea Gold in Washington contributed to this report.