Bush pushes tax cuts

President Bush says his budget is responsible

US President George W Bush has called for radical tax cuts totalling $1.6 trillion over 10 years.

Addressing a joint session of Congress for the first time, he defended his plan with a line that earned him laughter even from his opponents: "Some say my tax plan is too big, others say it is too small. I respectfully disagree. This plan is just right."

The people of America have been overcharged, and on their behalf, I am here asking for a refund

President
George W Bush

In addition to his tax proposal - a cornerstone of his election campaign - Mr Bush called for more money for health care and education.

But despite a speech that called for bipartisanship, Democrats showed little enthusiasm for Mr Bush's agenda.

"If what we heard tonight sounds too good to be true, it probably is," said House Minority leader Dick Gephardt. "President Bush's numbers simply do not add up. Ours do."

Government intervention

Mr Bush argued that the slowing US economy needed a jolt from the government.

"Tax relief is right, and tax relief is urgent. The long economic expansion that began almost 10 years ago is faltering," he said.

Mr Bush described his budget as ''reasonable and responsible''.

Mrs Bush will travel the country to promote education

But Democrats immediately announced their opposition, saying the budget favoured the wealthy at the expense of social programmes.

An intially nervous-looking Mr Bush, who was frequently interrupted by applause, told Congress he would promote private initiative and charities.

In an effort to put flesh on the bones of his notion of "compassionate conservatism", he said he would lead a government that was active but limited.

"Government has a role, and an important one. Yet too much government crowds out initiative and hard work, private charity and the private economy,'' he said.

Mr Bush will formally present to Congress his $1.9 trillion budget for the fiscal year 2002 on Wednesday.

In his speech to Congress, he outlined his plans for the $5.6 trillion in budget surpluses projected for the next decade.

'Refund'

He said he wanted more spending on education and health care while restraining the annual increase in government spending to 4%, rather than last year's 8%.

He said he intended to pay off $2 trillion of the $3.4 trillion national debt, but he gave the most time in his 50-minute speech to his plans to cut taxes radically.

If what we heard tonight sounds too good to be true, it probably is

Democratic leader Dick Gephardt

''The people of America have been overcharged, and on their behalf, I am here asking for a refund,'' he said to Republican applause.

But opinion polls say Americans have given the tax cut plan a lukewarm response, preferring instead the money be directed to needs like education and health care.

Democrats sceptical

Mr Bush said he could cut taxes and still provide money for those areas.

''To create economic growth and opportunity we must put money back into the hands of the people who buy goods and create jobs,'' he said.

Democrats listened politely

Democrats say the tax cut is too big and would benefit the wealthy and leave social programmes wanting.

"It will consume nearly all of the surplus - at the expense of prescription drug coverage, education, defence and other critical priorities," said Senate Democratic leader Tom Daschle.

Mr Bush began his speech by revisiting a central theme of his campaign: A call for Democrats and Republicans to put the country above politics.

''Let us agree to bridge old divides,'' he said. ''Bipartisanship is more than minding our manners - it is doing our duty.''