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Jonny Dymond in Washington
"George Bush will hope to stir up a little heat"
 real 28k

Thursday, 1 March, 2001, 00:48 GMT
Democrats declare war on Bush cuts
George W Bush
On his way: Bush sets off to sell his plan the country
Democrats in Congress said on Wednesday they will fight President George W. Bush's budget $1.6 trillion tax cut plan.

Mr Bush, who is on a five-state tour to win support for his plan, has sent Congress his proposals for the coming fiscal year, which will lay the ground for the 10-year tax reduction programme.
Key budget points
Spending growth cut by half to 4%
More money for education, defence, housing and foreign affairs
Less money for agriculture, energy and transport

But with the Senate equally split between Republicans and Democrats, Mr Bush will need to win bipartisan support if his budget is to be passed.

Democrats say the budget devotes too much to tax cuts and too little to debt payment and national needs.

House Democratic Leader Dick Gephardt, said. "This budget decides that the tax cut is more important than any other priority or need that the nation has."

Spending halved

Mr Bush has not won universal support from his party either, with two Republican senators already saying that his proposed tax cut is too large for them to support.

Mr Bush will begin his tour in Pennsylvania, before continuing to Nebraska, Iowa, Arkansas and Georgia.

These are all states with moderate and conservative Democrats whose votes Mr Bush hopes to gain in the House and Senate.

President Bush's budget for fiscal 2002, the year beginning on 1 October, would limit spending growth to 4%, rather than last year's 8% rise.
George W Bush
Bush has worked on the plan with his budget team - now he has to convince the public

It provides for increases in expenditure on education, defence, housing and foreign affairs, while cutting back on agriculture, energy and transport.

The budget would be the first stage of a planned $1.62 trillion tax cut over 10 years, while reducing the national debt to its lowest level for almost a century.

Government intervention

In his speech to Congress, 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''.

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

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

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See also:

27 Feb 01 | Business
US tech stocks tumble
12 Feb 01 | Business
President Bush's tax cure
08 Feb 01 | Business
Can Bush avert recession?
04 Jan 01 | Business
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14 Dec 00 | Business
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27 Oct 00 | Business
How to spend the surplus
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