After weeks of buildup, President Bush unveiled his "growth and jobs" package today. The $674 billion plan is designed to boost the economy by accelerating tax cuts, eliminating the dividend tax, and providing incentives for businesses to invest in new equipment.
The White House claims the proposal would provide 92 million Americans an average tax cut of $1,083 this year and create 2.1 million jobs over the next three years. Democrats have attacked the plan, saying it helps mainly the rich and is designed to boost Bush's reelection chances in 2004. They have provided a $136 billion counterproposal that would give a $300 rebate to every taxpayer, extend unemployment benefits, and offer breaks to small businesses and state governments.
The central question surrounding both proposals is how much they would actually help the economy. Many experts believe neither would have much effect in 2003. An Associated Press story suggests a slow recovery this year, with the possible war with Iraq or terrorist activities being the biggest threats to that scenario. The proposed stimulus package, on the other hand, won't help much in the short term because of the length of time it will take to work through both houses of Congress.
[Bill Mann (TMF Otter) will provide detailed analysis of the president's proposal in tomorrow's Rule Maker column.]