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Last Updated: Wednesday, 19 January, 2005, 17:42 GMT
Bush's domestic agenda: Key plans
George W Bush talks a lot about tort reform and Social Security - but what exactly are they? BBC News's John Shields explains five of the most important domestic projects the president is likely to focus on in his second term.

SOCIAL SECURITY

George W Bush speaks to his Panel on Tax Reform
Social Security is the name for America's state pension scheme, funded by a tax on wages.

As America's baby boomers retire, pension benefits will start flowing out of the Social Security fund faster than taxes are paid in by active workers.

Projections show a shortfall of $3.7trillion over 75 years, which future generations will have to cover.

President Bush argues that radical reform is needed to avert a pensions crisis. He wants to allow young earners to divert some of their payroll tax into private accounts.

The president's critics say that the shortfall can be covered by tweaking the existing system. They claim he is manufacturing a crisis to justify a privatisation plan.

JUDICIAL APPOINTMENTS

The so-called "culture wars" over issues like abortion and gay marriage will be fought out over the president's power to appoint judges to federal courts.

Presidential appointments must be confirmed by the Senate, giving the opposition Democrats a chance to block nominees they dislike.

The usual squabbling over appointments has been super-charged by the prospect of the first Supreme Court vacancy in over a decade.

The age of the nine incumbent justices makes it likely Bush will have to make at least one appointment in the next four years.

Moderates, liberals and conservatives divide roughly evenly in the court. Replacing one could tip the political balance of the judiciary for a generation.

TORT REFORM

Tort is a branch of law designed to punish corporate negligence and compensate accident victims.

President Bush says the $230billion spent each year on pursuing compensation lawsuits hurts the economy by driving up the cost of insurance.

Medical malpractice suits are a particular problem since they drive up health care costs and scare doctors away from high risk areas.

Mr Bush wants to limit pay-outs for medical malpractice, stop plaintiffs shopping around for courts that award the biggest pay-outs, and curb lawsuits involving asbestos firms.

Democrats, who rely on donations from trial lawyers, say compensation protects vulnerable people from greedy corporations. They blame insurance companies for driving up health care costs.

TAXES

President Bush's first-term tax cuts are set to expire in 2010. Making these permanent is a priority, despite the record budget deficit.

The success of fiscal conservatives in November's Congressional elections also raised the prospect of wholesale tax reform.

Tax reform means simplifying the tax code, which runs to 60,000 pages.

Conservative activists want a flat tax rate or to scrap income tax completely and replace it with a national sales tax.

Mr Bush will not go that far. He may continue to make the tax code more conducive to savings and investment, but by making his tax cuts permanent he will restrict his room for manoeuvre.

IMMIGRATION

There are eight million illegal immigrants living in the US and a further one million enter the country each year. Hundreds die each year trying to cross treacherous desert borders.

Businesses want immigration controls relaxed so that they can get cheap labour without breaking the law, but immigration has also become a security concern since 11 September.

The issue divides Republicans. President Bush has proposed a guest-worker programme and wants to make it easier to become a citizen.

The president's plan is a vote winner among Hispanics, but opposition among Republican hardliners means Mr Bush will need Democratic support to make it law.




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