In the end, voters will probably want to see both. President Clinton is framing the debate in Democratic terms with a series of poll-tested government initiatives. But the politics of prosperity may be playing out most clearly at the state level, where governors and legislatures are enjoying their own big surpluses. Most states also increased spending by more than 5 percent for this year, at a time when inflation has been minimal. The most popular form of new expenditure was for education, particularly kindergarten through 12th grade, which has increased an average of 7.1 percent annually over the past five years.
States calibrate the balance between tax cuts and public investment in different ways.
Among other things, the money would pay for expanded preschool programs, computers in classrooms, and creating three research institutes at the University of California. Unlike many other governors, Davis proposed no new tax cuts. And he emphasized education reform, including a requirement that fourth graders who haven't learned to read properly attend summer school. People want adequate surpluses, but they also want tax cuts and they want government to be more efficient and accountable. World Report Inc. All rights reserved.