Democrats have hinted that they'll go along with parts of the Bush plan. Congress passed bills earlier this year aimed at fixing provisions that penalize some married couples and reducing the estate tax, but Clinton vetoed the legislation. Democrats have little incentive, however, to buy into the entire Bush plan. Ideologically, the party is opposed to the massive cut. Most of its benefits would go to well-off Americans in a country where profitable corporations and the wealthiest 50 percent of the people pay 96 percent of the taxes.
Tax policy is a natural election year line in the sand.
Even House Speaker Dennis Hastert, R-Ill., has said Bush's tax package might go down easier in bits and pieces than as a single gulp. Bush claims the cuts would put money back in the private sector, increasing savings, investment and consumption. Not all tax cuts are beneficial. Entin rejects the argument that tax cuts would threaten the federal budget surplus and run up interest rates. The White House counters that a slowing economy, combined with large tax cuts, would have enough impact on the federal budget to spike interest rates, as private borrowers are forced to compete with mounting government needs for scarce capital.