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Wednesday, January 31. 1990 / University Daily Kansan
Bush's Budget
Budget could mean higher taxes
The Associated Press
WASHINGTON — To hear some members of Congress tell it, President Bush's "no new taxes" budget may have just set the stage for a $2 billion tax increase this year.
As the administration launched a defense of its tax and spending blueprint yesterday, various influential Democrats said they viewed the Bush budget as an open invitation to raise taxes, given the fact that the Republicans have called for "revenue raisers" in his own budget.
Both House Budget Committee Chairman Leon Panetta, D-Calif., and Senate Budget Committee Chairman James Sasser, D-Tenn., said that they were willing to accept Bush's proposal to raise revenues by $21.7 billion but that Congress was likely to radically alter the mix on how that money was obtained.
"That revenue figure in total is something that we can accept." Sasser said. "Unfortunately, in the past it was not legitimately achieved."
While the president proclaimed
that his 1991 spending plan would slash the deficit in half "without raising taxes," the budget actually included a hodgepodge of increases in taxes and user fees that would bring in an additional $21.7 billion in the 1993 fiscal year, which starts next October.
The Bush budget proposes $15.7 billion in tax revenue, which is offset by $1.8 billion in tax cuts.
The president also proposes raising $5.6 billion in new user fees charged for providing government services, $1.6 billion in the sale of government assets and $600 million in other new receipts, bringing the total to $21.7 billion.
Critics of the Bush budget charge that the administration has recycled a variety of proposals, many dating back to the Reagan administration, that Congress has relected in the past.
One retread is a proposal to assess federal Social Security taxes on state and local government employees in the handful of states who are now not covered by the levy, a $3.8 billion revenue raiser that Bush unsuccessfully sought last year.
Other proposed revenue increases would extend the soon-to-expire 3 percent tax on long-distance telephone calls, increase the tax on airline tickets from 8 percent to 10 percent and pick up $2.5 billion by beefed-up enforcement at the Internal Revenue Service.
Bush's biggest revenue raiser for next year is actually a tax cut, the proposed reduction in the capital gains tax, the levy on profits made from the sale of assets such as stocks or real estate.
Bush estimates that would bring in $4.9 billion in additional money in 1991 as people rushed to sell assets to take advantage of the lower tax, but critics charge that the proposal would lose money in later years because of the lower tax bite.
Panetta suggested that Congress might consider compromising on the capital gains cut sought by Bush if the president was willing to consider tax increases in other areas, possibly a higher top tax rate for individuals or a boost in energy taxes.
Treasury Secretary Nicholas Brady told reporters yesterday
that the administration was optimistic about the chances for getting a reduction in capital gains passed this year after falling to do so in 1988.
"All of the comments I have heard by returning congressmen and senators indicate to me that they think it has even a better chance," Brady said.
Brady, speaking to reporters at the White House, said the administration would not support Moynihan's proposal as part of a bargain to get the capital gains tax cut and allow Moynihan to Moynihan's proposal as "goofy."
But complicating the tax debate is a rival plan by Sen. Daniel Moynhan, D-N.Y., to slash Social Security taxes by $62 billion in 1900 and 1981 by rolling back two scheduled rate increases.
Brady said that people in the United States have faith in the Social Security system as it now works.
"People don't talk about it. They think the money is there." Brady said, terming Moynihan's proposal to return the surplus to taxpayers as "the height of folly."
Plan to close bases attacked as partisan
The Associated Press
WASHINGTON — The chairman of the House Armed Services Committee yesterday accused the Bush administration of putting "a political gun to the head" of lawmakers with a partisan list of military base closings.
Rep. Les Aspin, D-Wis., said Defense Secretary Dick Cheney's list of more than 72 domestic bases and 14 overseas installations that would be closed or scaled back had potential. But he objected strongly to the way the administration wants Congress to deal with the list.
"This is merely a list of candidates for closure," Aspin told reporters at a news conference.
"The process is dead." Aspin said of the administration approach. He introduced legislation that would creat e more efficient new base-closing recommendations.
That panel — similar to a commission created by Congress in 1988 — would produce an all-or-nothing list of closings for approval or rejection by the defense secretary and Congress. The recommendations of the
1988 panel to close 86 bases were adopted by Congress last year.
Cheney, in presenting his $292.1 billion military spending plan for
'This puts a political gun to the head of a member with a base in his or her district.'
- Les Aspin
chairman of the House Armed Services Committee
fiscal 1991, proposed on Monday a list of bases for closing or realignment that would be considered by lawmakers on an individual basis.
"This puts a political gun to the head of a member with a base in his or her district," Aspin said. "If you've got a list of potential bases to be closed and the vote comes up on say, overriding the veto on the China thing, what you've done is create an awful lot of bargaining chips for the administration when it goes into negotiating with congressmen and senators on how they're going to vote on the veto override."
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