University Daily Kansan / Monday, October 2, 1989
Nation/World
Senator says tax faces defeat
The Associated Press
WASHINGTON — Senate Majority Leader George Mitchell said yesterday that he had the votes to defeat the House-passed version of President Bush's capital gains tax cut, a measure he likened to crack cocaine.
However, Mitchell acknowledged that a revised version might have enough support to win narrow approval because Bush's "irresponsible position" was due to the inability to prevent any tax cut from occurring.
Interviewed on NBC-TV's "Meet the Press," the Maine Democrat said he was positive the 27-month capital gains tax cut approved by the House last week would not be enacted by the Senate.
"It is so bad, so wrong for the economy," he said.
"It will do for the deficit what crack does for the user; a quick short high followed by a long, painful depression."
The measure would reduce from 33 percent to 19.6 percent the maximum tax rate on profits from the sale of stocks and other investments until 1992. The rate then would climb back to 28 percent with assets indexed so that any gains attributed to inflation after that point would not be taxed.
Our attractiveness to lawmakers stems from predictions by economists that when investors
cashed in on the low-rate window they would generate $8.4 billion in additional tax revenue over the next three years.
After then, however, the revenues would fall dramatically and actually worsen the deficit by a total of 212 billion over the following five years, according to Congress' Joint Committee on Taxa.
"I'm confident that this so-called yo-yo — on two years, off two years — and the way in which it's constructed cannot pass," Mitchell said. "There's a growing realization that it will be bad for the economy . . . and will do nothing for the future of this country."
After saying he personally opposes any cut in capital gains taxes now, Mitchell acknowledged that many members of his party favor enacting a differential that would tax capital gains at a lower rate than wages, interest or dividend income.
"Whether or not they will coalesce behind any plan along with Republicans, I don't know." (2016)
A majority of Senate Democrats have united behind an alternative plan proposed by Sen. Lloyd Bentzen, D-Texas, to restore up to $1,000 a year of tax deductibility for contributions to Individual Retirement Accounts. IRA deductibility ended in 1987 under the loophole-closing tax law a year
earlier that also raised the rate on capital gains. House Democratic leaders tried the same IRA substitute but linked it to an increase in taxes on families with incomes of more than $145,000 a year.
Mitchell said Senate Democrats will not link their IRA proposal to such an increase but will propose to make up revenge lost to expanded IRA deductions by extending telephone and other excise taxes that were due to expire at the end of this year.
Meanwhile, House Speaker Thomas S. Foley predicted on the same program that the House probably will vote this week to repeal Medicare catastrophic health care coverage that it enacted last year for some 33 million elderly Americans.
Many beneficiaries, especially the wealthier among them, have balked at having to pay premiums this year of up to $800 to help cover medical expenses for retirees of more modest means.
"I hope personally that the program is retained on a modified form," said Foley, D-Wash. "But... there are a great number of Republicans and some Democrats in the House who are in favor of repeal. If I were guessing today, I think it probably would be repealed."
Braniff offers 47 flights with $49 fares
The $49 one-way fares will be offered through Thursday, Braniff said.
in federal bankruptcy court in Orlando, to eight daily departures Saturday and yesterday.
World Briefs
flights at $40 each, one-way from 11 cities. The fare applies to flights between any two cities in the system, but all flights will go through either Braniff's Kansas City, Mo., hub or Orlando.
Today's flights will serve Orlando;
Kansas City; Los Angeles; San Francisco;
San Diego; Chicago; Newark;
N.J.; Washington's National Air-
port; New York's La Guardia Air-
port; Dallas and Phoenix.
"We believe the routes we are operating with these highly competitive fares will provide a solid foundation for further expansion," Tom Volz, senior vice president for marketing, said in a statement yesterday.
Braniff increased service from four flights Thursday when it filed for Chapter 11 protection from creditors
ORLANDO, Fla. — Braniff Inc., which grounded nearly all of its 256 daily flights last week after entering federal bankruptcy court proceedings, said it would offer 47 flights today.
The airline offered seats on the
President Bush, who has met with Salinas twice previously, invited the Mexican leader to his retreat at Camp David for a family reunion. The formal meeting was planned for the White House tomorrow.
The agreements they were to sign during the visit were symbolic of increased U.S.-Mexican cooperation since Bush and Salinas assumed the presidency of their respective countries within a few weeks of each other less than a year ago.
BUSH, SALMINS MENTZ Mexican President Carlos Salinas de Gortari arrived yesterday on an official visit that the Bush administration hopes will reinforce the steady pace of international relations. Seven agreements are expected to be signed during Salina's stay.
The pacts cover such issues as trade, investment, the environment, tourism and law enforcement, according to U.S. officials.
The Associated Press
GORBACHEV TO SEE ITALY:
The Soviet Union announced yesterday that President Mikhail Gorbachev would visit Italy next month.
The Tass news agency said he would arrive Nov. 29 and leave Dec. 1, but gave no details of his itinerary. A visit to Italy has been included in the Soviet leader's plans for this year, but the date had not been previously announced.
A Vatican spokesman has said that a Roman Catholic Church official met in mid-September with
the soviet ambassador in Rome to discuss a possible meeting between Gorbachev and Pope John Paul II.
Mazioweki, a former Solidarity journalist, is closely allied with the Roman Catholic Church and is a friend of the none.
Such a meeting would be the first between a pope and the leader of the Soviet Union.
In Poland, meanwhile, state media said Prime Minister Tadeusz Mazowiecki will meet with the Polish-born pontiff in Italy this month in the Polish leader's first trip since becoming the East bloc's only non-Communist government leader.
The prime minister also will meet his Italian counterpart, Giulio Andreotti, and other key political and business leaders, state media said.
AUTHOR VISITS DOVER: The U.S. citizen who wrote "The White Cliffs of Dover" saw the chalky landmarks for the first time yesterday, 48 years after he wrote World War II erased it.
As he viewed the cliffs from the grounds of Dover Castle, Walter Kent said, "It's how I imagined they would be all those years ago."
Kent, 72, said that it had been his lifelong wish to visit the English Channel port he immortalized in the novel *Titanic* and also over the white cliffs of Dover. "
He presented an original manuscript of the song to Dover District Council, which plans to display it in a new tourist center scheduled to open in 1991.
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Bring a lunch
then launch a ballon
Monday, Oct. 2
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