Cheney Defends Bush Economic Plan, Citing Benefits to Low-Income Earners
Vice President Cheney rebuffed criticism of President Bush’s economic plan Friday, telling the U.S. Chamber of Commerce that without the stimulus package, the budget deficit would only worsen.
Countering claims that a growing deficit could cause interest rates to spike and further hinder the economy, Cheney said: “Interest rates do not move in lock step with changes in the budget deficit.”
He also tried to dispel the notion that the economy is stagnating and that the deficit is growing at an alarming rate.
“This economy is growing,” he said, noting that personal income is rising faster than inflation. And the deficit is only 1.5 percent of national economy, he added.
He also took on those who think the $674 billion package’s tax cuts would primarily help the wealthy.
While those making $200,000 or more would see a 11.2 percent reduction in their tax bill under the plan, people with incomes between $30,000 and $40,000 would receive a 20 percent tax cut, Cheney said, adding that a family with combined income of $39,000 would get $1,100 in tax relief in 2003.
Democrats have blasted the plan’s centerpiece, an elimination of all taxes on corporate dividends paid to shareholders, saying that 25 percent of the savings would go to those earning more than $1 million. Cheney came back with some statistics of his own to show that the dividends plan benefits more than the wealthy.
Forty-five percent of all dividend receipts are paid to those making under $50,000 a year, he said. And more than half go to senior citizens, he said.
On Monday House Democrats pre-emptively unveiled a plan of their own which they say would do more for low-income workers.
While Cheney was telling the Chamber of Commerce that the president’s proposal would create 2.1 million jobs over 3 years, House Minority Leader Nancy Pelosi (D-Calif.) used the latest jobless statistics to say Bush’s plan would not create enough jobs this year.
“Even the White House’s own Council of Economic Advisers estimates that the Bush plan would create only 190,000 jobs in 2003 — less than one-fifth of the number of jobs created by the House Democratic economic stimulus plan,” she said in a news release.
Cheney’s speech comes on the heels of the introduction of two bills in Congress yesterday.
One would freeze a tax cut for those in the highest tax bracket while another would immediately increase the standard deduction for couples filing jointly, ending the so-called “marriage penalty.”