Bush Nudges Debate to Right, With Limits

WASHINGTON —  What a difference an election makes.

In a confidently delivered, rhetorically unadorned address to Congress on Tuesday night, President Bush touted massive tax cuts, partial privatization of Social Security, private school vouchers, new restraints on federal spending and a fundamental restructuring of Medicare. None of those ideas was on the table when President Clinton delivered his final State of the Union address last year; nor would any of them have been on the president’s agenda if Al Gore had won the White House.

It’s become increasingly clear Bush is unlikely to get exactly what he wants on any of those fronts. But his speech was a reminder of how much he has already moved the national policy debate in a conservative direction--particularly on tax cuts, the centerpiece of his domestic agenda.

This year, as their opening bid, Democrats are proposing a tax cut of about $750 billion over 10 years, a figure only about half of Bush’s $1.6-trillion proposal but larger than the Republican measures Clinton vetoed last year.

“Elections have consequences,” said GOP pollster Bill McInturff. “We are debating Republican ideas in a situation where Republicans are driving the issue agenda.”

While anchoring the speech in conservative ideas such as tax cuts, Bush also displayed his determination to envelop the Democrats. Repeatedly, he sought to claim issues Democrats usually define as their own, from protecting patients in health maintenance organizations to increasing education spending. On all these fronts, Democrats are sure to argue Bush’s plans don’t go far enough, but politically the president’s aggressive positioning may blur contrasts that have often worked to his rivals’ advantage.

Yet if the speech demonstrated Bush’s success in shifting the parameters of debate, it also exposed the limits of his progress.

With GOP congressional moderates expressing concern that Bush’s tax plan could risk tilting the federal budget back into deficit, Bush felt compelled Tuesday to pledge that he would reduce the federal debt by $2 trillion over the next decade. He also tried to dampen Democratic resistance to the tax cut by promising new spending on priorities such as education and health care.

But if Bush meets those goals while also cutting taxes, he may not have enough money left to fund the other major priority he introduced Tuesday: carving out private accounts in Social Security that workers could use to invest for their own retirement.

“The problem is if you add big debt reduction as one of your goals, something has to give, because you can’t do a big tax cut and the Social Security private accounts and eliminate the publicly held debt,” said Robert Bixby, executive director of the Concord Coalition, a nonpartisan fiscal watchdog group. “There is just not enough money to fit all those things in there.”

Administration officials insist that all of the president’s goals can fit within the projected $5.6-trillion federal budget surplus over the next decade, as long as Congress restrains the growth of spending for other federal programs.

But as Bush seeks to make that case, he faces challenges of both numbers and priorities. His first hurdle is convincing skeptics in both parties that his numbers, in fact, will keep the federal budget in the black; that was a principal focus of his speech.

But even if Bush crosses the accounting threshold, he must still make the case that his priorities represent the wisest allocation of the surplus. Polls continue to show that more Americans prefer to use the surplus on Social Security and Medicare--and even increased domestic spending--than tax cuts. Targeting that sentiment, Democrats are rapidly escalating their charges that Bush can fund his tax cut only by shortchanging other public priorities, from Social Security to prescription drugs for the elderly.

“Up until now, Bush has been discussing taxes in a vacuum,” said Democratic pollster Geoff Garin. “The Democratic imperative is to force the discussion into the broader context of the budget, and budget choices.”

Democrats hope to reprise the debate of 1995, when Clinton broke the momentum of the new GOP congressional majority by successfully portraying its proposed tax cut as a threat to Medicare, education and other popular programs.

But Bush’s speech demonstrated again that he is likely to present Democrats a much more difficult political target than former House Speaker Newt Gingrich (R-Ga.).

Bush went out of his way to avoid Gingrich’s anti-government flourishes; instead, he declared “government has a role and an important one.” Sounding a Clintonesque note, Bush argued that his plan forged a third way between “those who want more government, regardless of the cost [and] those who want less government regardless of the need.”

Bush also took pains to emphasize his new initiatives: more spending for education, tax breaks and new federal grants to encourage faith-based charities that minister to the poor, a doubling of the budget for health research, a tax credit to help the uninsured purchase health coverage, even a directive that Atty. Gen. John Ashcroft “develop specific recommendations to end racial profiling.”

Yet much as Clinton balanced his centrist notes with policies that appealed to the Democratic base, Bush offset his activist proposals with a strong pitch for limiting government, largely by shifting power from Washington to local governments and individuals.

That common theme ran through Bush’s proposals to restructure Medicare, consolidate federal education programs into block grants that would give states greater flexibility in spending the money, create the individual investment accounts under Social Security and, above all, cut taxes.

Referring to the burgeoning federal surplus, Bush said: “Even though we have already met our needs, we could spend the money on more and bigger government. . . . The other choice is to let the American people spend their own money to meet their own needs.”

Bush’s agenda--drawn together in Tuesday’s speech for the first time in his presidency--showed more ambition than for which he is often credited. Bush’s blueprint wasn’t as broad as the ones Clinton typically unfurled on such occasions.

But on the issues he did address, Bush frequently proposed bigger changes than Clinton typically offered after 1994. Among them: the largest tax cut proposal since President Reagan’s in 1981, the most fundamental changes in Social Security and Medicare since their founding, an abrupt slowdown in the growth of federal spending and the development of a national missile defense that would become the fulcrum of a historic shift in nuclear strategy.

What makes this agenda even more dramatic are the circumstances surrounding it. Bush offered it after an election that saw him win the second-narrowest Electoral College majority in American history, while losing the popular vote. He presented it to a Congress as narrowly divided between the parties as at any time in the last century--and already bridling at some of his most controversial ideas.

Yet Bush has proceeded in his first weeks as if he won a decisive mandate, and he delivered his speech in that spirit Tuesday. He was brisk, confident, witty at times, and overall far more comfortable than he appeared in his acceptance speech at the GOP convention last summer, when he sometimes seemed too nervous to breathe, much less smile.

So far, this approach has paid benefits to Bush. On education, he continues to move closer to a bipartisan compromise; he received a pre-speech boost early Tuesday when the National Governors’ Assn. backed key elements of his plan.

On taxes, Democrats have been pulled in his direction; even if Bush is forced to retrench his plan, “he has already won three quarters of the argument,” said Tom Cole, former chief of staff at the Republican National Committee. “He has moved the Democrats a lot more toward him than they have moved him toward them.”

But almost across the board, the signs are that Bush has squeezed about as much as he can out of these early gains.

Democrats, and many moderate Republicans, remain resolutely opposed to his school voucher proposal. Senate GOP moderates are wavering on the size of his tax cut, with several openly proposing to link it to progress in reducing the national debt, an idea Bush strongly opposes. Even congressional allies say his Medicare restructuring has little chance. And when the Social Security commission he said he would appoint reports this fall, it will face a daunting reality: Only one Senate Democrat (Louisiana’s John B. Breaux) now openly supports the creation of individual accounts, far too few to break the inevitable filibuster against any such proposal.

On all these fronts, the ground ahead promises to be much tougher for Bush than the ground he has gained so far. His speech offered an assured and coherent case for his agenda. But the challenge still ahead will be to build a larger public constituency for his ideas as president than he did as a candidate.

8

More Inside

No Target: The speech, short on specifics, didn’t provide Democrats with much to attack, A14