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Jewish World Review August 1, 2000 /29 Tamuz, 5760

Morton Kondracke

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GOP Readies 'Debt Lockbox' As 2000 Strategy


http://www.jewishworldreview.com -- IF HOUSE REPUBLICANS can't get President Clinton to agree to new tax cuts -- as seems likely -- they are preparing a new "lockbox" or "debt wall" strategy to convince voters this is not a "do-nothing" Congress.

Under the strategy, if Republicans can't go into the election saying they've eliminated the marriage penalty and inheritance taxes, they would say they blocked Clinton's spending plans and trumped him in paying down the national debt.

The strategy involves allocating to debt reduction the amount of whatever tax cuts Clinton vetoes, creating a third "lockbox" to follow on those already instituted for Social Security surpluses and Medicare revenues.

Republicans think they have already escaped the "do-nothing" label that Democrats were eager to pin on them by adopting an "offensive agenda" of lockboxes, tax cuts and alternatives to Democratic proposals on patients' rights, education, prescription drugs and the minimum wage.

Moreover, Republicans think -- with some justice -- that they hit upon a shrewd tactic this year in splitting their tax cut wish list into its popular component parts and forcing Democrats to vote with them.

This ploy has been so successful that Clinton signed a bill lifting the earnings limit for Social Security recipients and is bucking public opinion in vetoing other measures.

In a rare example of cooperative bipartisanism, the House on Tuesday passed tax cuts worth $21 billion over 10 years as part of a broad effort to aid poverty communities. The vote was 394-27.

Of course, Democrats haven't given up on the "do nothing" charge, arguing that failure to enact laws on patients' rights, prescription drugs and many other issues constitutes failure on the part of the GOP Congress.

But Vice President Al Gore has been forced to modify Harry S Truman's 1948 "do nothing" attack into "do nothing for people," implicitly acknowledging that Congress has been active, but in aid of the privileged and special interests, not ordinary folks.

To regain the initiative for his party, Clinton has launched an all-out offensive against "the fiscally irresponsible, poorly targeted and regressive Republican tax plan."

In a radio address, Clinton charged that "Congressional Republicans are treating the budget surplus as if they'd won it in the lottery," planning to give it all away in tax cuts that would provide more relief to the top 1 percent of taxpayers rather than to the bottom 80 percent.

By White House calculations, Republicans so far this year have passed tax cuts worth $712 billion over 10 years -- $913 billion when you count lost interest savings -- and over the past two years, a total of $1.8 trillion.

Clinton is set to veto a just-passed $293 billion marriage penalty relief bill when it reaches his desk and a $105 billion estate tax repeal and has indicated he also opposes raising IRA and 401(k) contribution limits and reduction of taxes on Social Security benefits.

In a reversal of the GOP tactic of passing token measures on patients' rights and prescription drugs, Clinton has is offering a series of "targeted" tax cuts worth $263 billion over 10 years.

Clinton claims that by rejecting major tax cuts, his budget reserves enough of anticipated budget surpluses to pay off the $1.5 trillion federal debt by the year 2012, while also providing a prescription drug benefit for all seniors and increasing funds for health and education programs.

Republicans haven't definitely decided to give up on their tax cuts. First, they'll try to override Clinton's vetoes. If that's unsuccessful, leadership aides say, they may attach some tax relief measures onto legislation that Clinton wants, such as the minimum wage increase.

They may also repackage some cuts into a September budget reconciliation bill -- which would not be subject to a Democratic filibuster in the Senate -- and hope to negotiate a compromise with Clinton. But the President might veto that, too.

"What Clinton hopes," said one top GOP leadership aide, "is to dangle a few [tax cut] scraps in hopes that we'll suck up to a whole bunch of big spending programs" when Members are anxious to leave town in October to campaign.

"Last year, we waged the fight against new spending on the basis of preventing a raid on the Social Security Trust Fund," said the aide. "The fight this year will be, 'Are we going to take the money from these vetoed tax cuts and use them to pay down the debt, or are we going to spend them on new programs?' This will take us into the election. We'll be on the side of debt reduction."

Polls indicate that the public wants to use the budget surplus for debt reduction ahead of both spending and tax cuts. Gridlock in Washington might give the public what it wants. With both parties claiming credit -- and fighting to a draw -- the public just may decide that divided government is good.



JWR contributor Morton Kondracke is executive editor of Roll Call, the newspaper of Capitol Hill. Send your comments to him by clicking here.

Up

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