Recession at home, war abroad to be focus of State of the Union address

January 29, 1991|By Peter Osterlundand Karen Hosler | Peter Osterlundand Karen Hosler,Washington Bureau of The Sun

WASHINGTON -- President Bush will stand before the Congress and the nation tonight, sharing his views about the state of a union gripped by recession and embroiled in war.

He is expected to dedicate most of his annual State of the Union address to a discussion of the latter, spending the rest of his time trying to ease the public's fear by minimizing the significance of the former.

Beyond that, White House officials indicated that tonight's speech would be long on generalities and short on explicit prescriptions for the nation's economic ills.

Instead, Mr. Bush is expected to share his thoughts on the country's direction during the next decade. No major new programs will be announced, although the president is expected to dust off, for example, economic growth-oriented proposals to reduce the capital gains tax rate and to establish tax-free "enterprise zones" in depressed areas.

"He will take the opportunity to demonstrate that he is in command, and in control and in charge," a White House official said.

In some respects, the president's hands are tied. The State of the Union speech traditionally kicks off Capitol Hill's budget-fashioning season; Mr. Bush's budget proposal for the next fiscal year is to be presented to Congress Feb. 4. But last year's sweeping deficit-reduction deal has sharply reduced the administration's latitude in crafting next year's budget -- and hence, Mr. Bush's ability to unveil bold, new programs in his nationally televised address, set to start at 9 p.m.

Nevertheless, administration officials insist that the president's speech will not be entirely void of specifics, and that he will echo several themes present in his forthcoming budget proposal. One of those themes -- the redirection of federal spending from upper-income to poor er Americans -- is intended to combat a Democratic contention that the Bush White House kowtows to the rich.

The president's budget, for example, is expected to include a bevy of proposals aimed at benefiting the less well-off. Administration and congressional officials say that it will propose increased spending on a variety of poverty programs, including the Agriculture Department's food program for low-income women, infants and children, and that it will include $200 million for a pilot program aimed at reducing infant mortality in cities where the problem is serious. It also will propose new limits on the eligibility of high-income people for certain farm and education programs.

Mr. Bush is also expected to propose reforming the nation's banking laws to make outdated regulations more practical and to try to improve the international competitiveness of U.S. banks by streamlining the regulation of foreign transactions.

What the president's speech is not expected to do is provide much enlightenment on the impact of the Iraqi war on the federal government's bottom line. His new budget is expected to include a $30 billion down payment on the Persian Gulf conflict. Administration officials say they will come forward with a request for an additional, presently unspecified, amount later, probably next month.

Nor is the president expected to share any drastic revelations about the war. Instead, he is expected to give a progress report and to review his reasons for initiating the conflict.

Speech coverage

The State of the Union address will be broadcast by ABC, CBS, NBC, CNN and C-SPAN at 9 p.m. All will carry the Democrats' response afterward, and CBS plans a special program, "The State of the War," at 10 p.m.

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