Bush's fraudulent economic plan

By Robert Kuttner, 1/31/2002

AIT-AND-SWITCH is almost too kind a description for the economic portion of President Bush's State of the Union address Tuesday night. Much as he did in the 2000 presidential campaign, Bush put forth an economic message that sounded like the work of a liberal Democrat.


The centerpiece of his program, he declared, would be good jobs. But look at the fine print and hardly anything in it provides jobs, let alone good ones. Meanwhile, unemployment is nearly 6 percent and rising.

Bush's misnamed ''stimulus'' package is mostly a tax giveaway to large corporations, on the premise that corporate tax cuts encourage companies to build new factories. But as most economists will tell you, companies expand when they see customers, not when people are losing jobs in a recession.

The so-called stimulus is mainly a deferred political reward to corporate allies who loyally supported Bush's previous cut in high-bracket personal taxes last year. It has little to do with getting us out of this recession, much less with creating jobs.

Bush also talked about health security, prescription drug benefits, and patients' rights - all popular issues put forward by liberals and Democrats. The poll-tested speech rhetoric was great. But the actual proposals insult the rhetoric.

Bush's proposed ''drug benefit under Medicare'' would be limited to the poor and near-poor elderly, with a maximum of $17,000 income for a couple. Although final details of the Bush proposal have not been released, a previous draft required people to spend $6,000 on drugs out of pocket first. So very few would actually qualify for benefits.

His proposed health insurance benefit is a tax credit that would cover only part of the cost of a stripped-down HMO plan - the kind of coverage that denies people medically necessary treatments.

And his proposed patients' rights bill is the version that the HMO industry supports, not the one that gives patients the right to sue if an HMO wrongfully overrides the medical judgment of a doctor.

Bush also talked about early-childhood development. But the administration opposes more funding for daycare, much less universal pre-kindergarten and childhood enrichment programs. All these have been sacrificed on the altar of last year's tax cut and the resulting fiscal alarm. But you wouldn't know that from the rhetoric either.

Bush emphasized jobs and health security and children for the simple reason that voters are concerned about them. He tried to steal the Democrats' clothes because Democrats' position on all these issues is far closer to what voters want. But his program does little for any of these concerns.

You might think that Democrats would be screaming from the rafters at this deception and partisan larceny.

But Democrats in general are intimidated by opinion polls, confused about deficits, and reluctant to criticize a president who is popular on the war. Democrats also have other fish to fry.

House Democratic leader Dick Gephardt plans to run for president. His speech blandly declared, ''Now is not the time for finger-pointing or politics as usual'' (as if Bush's address were anything else). Gephardt spoke mainly about ''values'' and trod very carefully around criticisms of the Bush economic program.

In the Senate, leader Tom Daschle, making the best of difficult circumstances, is hobbled by a caucus that is split three ways. Some Democrats, like Ted Kennedy, actually challenge Bush's priorities and offer alternatives. Kennedy works with Bush on selective areas of common ground like education, but is quite prepared to do battle elsewhere.

Other Democrats are still obsessed with the idea of fiscal virtue. So it falls to a Republican, George Bush, to defend deficit spending in a recession, while many Democrats make the deficit, rather than the government's priorities, the main issue.

Still other Democrats are de facto Republicans on most tax and budget issues.

In other wars, the opposition party has rallied behind the wartime commander in chief - while fiercely debating domestic and economic issues. Why not now?

In fact, there is a tacit opposition program that a great many voters value - defer tax cuts for the rich, use deficits in a recession, spend the money on things people need, and produce an economic recovery this year. All that the program lacks is fewer pollsters and more leaders.

Robert Kuttner is co-editor of The American Prospect. His column appears regularly in the Globe.