A year ago tax relief was said to be a political impossibility. Six months ago it was supposed to be a political liability. The bill Bush signed fell short of the reductions he wanted. It also lowered the top rate to 35 percent, not the 33 percent sought by Bush. By far the largest benefits of the tax cut will go to the wealthiest Americans, who pay a larger share of taxes.
Proponents point that the largest percentage of the tax cut goes to the middle class.
Bush said the tax cut will give middle-class families a boost in income to help pay for high energy bills and credit card debt. Amid a debate over how effective tax cuts will be toward boosting a U.S. economy in the doldrums, the White House circulated a report from the Morgan Stanley Dean Witter brokerage firm that said the tax cut will likely provide an economic stimulus. That defection tipped the balance of power to Democrats in the evenly divided Senate. Senate Democratic Leader Tom Daschle of South Dakota argued during the debate the tax cut was too large and would crowd out other budget priorities. Now as majority leader in the Senate, Daschle told reporters on Wednesday the tax cut would eventually have to be revisited but he did not see that happening any time soon.