Bush touts budget plans, faces new challenge to tax cut from leading Democrat

Saturday, January 12th 2002, 12:00 am
By: News On 6

WASHINGTON (AP) _ President Bush said Saturday that his budget will increase food aid for the swelling number of recession victims. But with deficits looming, a leading Democrat was set to propose rolling back one-quarter of Bush's tax cut.

Sen. Edward Kennedy, D-Mass., would be the most prominent Democrat to call for delaying part of the $1.35 trillion, 10-year tax cut, enacted last year. His plan would put off $350 billion in cuts for the wealthy to make room for more domestic spending, according to a source familiar with Kennedy's plans.

In his weekly radio address, the president said he would ask for a 8.3 percent increase in spending on the Women, Infants and Children program, which provides food vouchers and nutrition education to low-income families. He also promised to ask for new money for a job training program when he submits his budget to Congress next month.

He said these are ``vital programs that have proven their value'' and will help those affected by the difficult economic times.

``My budget focuses on the pressing needs of our country and on the basic needs of our citizens,'' Bush said.

Facing a budget deficit and increased demand for military and counterterrorism spending, Bush's 2003 budget request is sure to include cuts in other domestic programs. But like administrations before him, the president is using the weeks before his budget is unveiled to focus on the spending increases.

Many Democrats argue that the president's $1.35 trillion, 10-year tax cut _ along with the falling economy and post-Sept. 11 spending _ is to blame for the tight budget picture. But few have been willing to call for its repeal. The White House has accused anyone who does of wanting to raise taxes.

In a speech Wednesday at the National Press Club, Kennedy plans to call for a delay in a portion of the tax cut set to take effect in 2004, the source said Saturday.

The savings, some $350 billion over about seven years, would be available for domestic spending such as adding a prescription drug benefit to Medicare and improving education, he said.

A spokesman for Kennedy said the senator would have no comment on the issue Saturday.

This is the second year that Bush is proposing a spending increase for WIC, which aids nearly half of the nation's infants and one in four American children ages 1 to 4.

Last year, advocates complained that the Bush proposal was not adequate, but Congress wound up increasing spending even more, and the White House went along.

The $364 million increase being proposed this time would bring WIC spending to $4.75 billion, enough to serve an average of 7.8 million people per month.

``This does sound like good news,'' said Robert Greenstein, president of the left-leaning Center for Budget and Policy Priorities and an expert on WIC.

The Bush proposal also includes another $150 million for a contingency fund that would allow the program to expand to serve another 250,000 people should the recession make more families eligible. To qualify, a family's income must be below 185 percent of the federal poverty level, meaning a family of three would have to have less than $25,415 per year in income in 2000 dollars.

The president is also proposing an increase of $73 million for the Job Corps program, an 5.1 percent boost that would bring the program to $1.5 billion in 2003.

The program houses at-risk young people in residential training centers where they get intensive job training.

Greenstein called Job Corps ``one of the best programs the government runs.''

But while he was pleased with budget plans for Job Corps and WIC, Greenstein said it was possible that other important programs _ such as larger job training programs _ will be slated for cuts.

``You highlight the good news in January, and you don't run around and give Saturday radio talks on the domestic programs you're cutting,'' he said. ``We need to see the whole budget.''

White House spokesman Scott Stanzel would not say whether any other job training programs will be cut.

The first spending issue when Congress returns later this month will be the stalled economic stimulus plan. Democrats are pushing for more money for health benefits for the unemployed; Republicans want more for corporate tax breaks.

In his radio address, Bush pushed his approach.

``My plan is based on the simple truth that people out of work need an unemployment check; but what they need even more is a steady paycheck,'' the president said.

Responding for his party, Rep. Mike Ross, D-Ark., said Democrats ``do not think the answer to improving the economy is to provide a welfare bill for big corporations and special interests.''