WASHINGTON - Warning that the nation is already feeling the effects of an economic slowdown, President Bush sent his $1.6 trillion tax cut proposal to Congress yesterday and argued that Americans could help reignite the economy if given more money to spend and invest.
Bush's tax plan arrived on Capitol Hill already under pressure from Democrats who say it is too large and favors the rich, and from some conservatives who say it should be broader. Nevertheless, a consensus has built around the need for a major tax cut, which is now considered likely this year.
The president said he remained committed to his own blueprint, calling it a fair way to return surplus dollars to taxpayers while tending to an economy in a downturn.
"Consumer confidence has slumped," Bush said at a Rose Garden ceremony. "A warning light is flashing on the dashboard of our economy. And we just can't drive on and hope for the best. We must act without delay."
Democratic leaders countered the president's automobile analogy with one of their own yesterday, characterizing the White House tax cut as a windfall for the rich who, they contend, would reap the most money from it - enough to buy a new luxury vehicle.
"If you're a millionaire, under the Bush tax cut, you get a $46,000 tax cut, more than enough to pay for this Lexus," said Senate Minority Leader Tom Daschle, motioning toward a fully loaded car the Democrats had placed in front of the Capitol to illustrate their point.
"If you're a typical working person, you get $227," Daschle said. "That's enough to buy this muffler."
Bush's proposal is likely to trigger a prolonged debate in Congress in coming months and could test his strenuous efforts to forge a bipartisan spirit on Capitol Hill. White House officials played down such talk, instead congratulating themselves for reaching a point where even Democrats who once opposed any substantial tax cut now say they would back one - albeit a smaller, $700 billion-to-$800 billion cut that would aid moderate-income Americans most.
"There has been a powerful change," said Ari Fleischer, Bush's spokesman. "And the fundamental picture is, America is on the verge of a tax cut."
But spelling out the details of a plan that is to cover the next 10 years is no small matter, and Bush is bracing for pressure from several fronts to accept revisions to his plan that could alter the cut by hundreds of billions of dollars, higher or lower.
From within his own party, some are calling for an even bigger income tax cut and for a cut in the capital gains tax, pointing to new projections that the budget surplus will be greater than expected in coming years.
And business leaders are complaining that Bush did not include tax relief for corporations.
Meanwhile, the Democrats are warning that there would not be enough money left under Bush's plan to strengthen Social Security and Medicare and to pay for education and defense initiatives.
They also note that the Bush plan would not reduce Social Security and Medicare payroll taxes, which make up a larger share of the tax burden facing lower-income Americans than does income tax.
In addition, Democrats warn that Bush's cut would actually cost $2.6 trillion over 10 years, if calculated to include extra interest that would have to be paid on the national debt and several provisions they say the White House is not counting.
The White House disputes that price tag, but either way, Bush's cut would be the biggest since President Ronald Reagan's in 1981, which, Democrats contend, actually weakened the economy and hurt the most vulnerable Americans.
"We've already tried what President Bush is proposing," Daschle said. "We did that in 1981. The rich got richer, the poor got poorer, and working families got stuck with the entire bill. In 12 years, we quadrupled the national debt."
Daschle argued that Bush's plan "can't be a bill that says, `It's our way or no way.' It has to be a bill that recognizes if he really means what he says about bipartisanship, then it can be our way together."
Yesterday, the White House made the slowing economy its selling point, and Bush surrounded himself on a stage with Hispanic business owners. He praised them for creating jobs and expanding their interests, noting that the number of Latino-owned businesses nationwide has increased by 25 percent since 1997, when there were 1.4 million.
But Bush warned that, unless consumers and investors have more money to spend and support businesses, the economy would continue to lag and such progress by Hispanic-Americans and other small entrepreneurs could stall.
The plan he outlined yesterday was nearly identical to the one he proposed as a presidential candidate, campaigned on through the election and has been promoting this week.
It calls for an across-the-board income tax rate cut, to be accomplished by adjusting the brackets that determine what percentage of income a citizen pays as taxes.