The brave new element, of course, was the $300 billion elimination of the tax on corporate dividends. This one, the White House says, is for the stock market and the old folks, and also, Bush stressed, because "double taxation is wrong." (The application of morality to fiscal policy is a relatively recent entry into the field of economics, but Bush seems to have a pretty steady moral compass for this sort of thing.) There was some other stuff, too: help for the jobless through unemployment-benefits extensions and funding state "re-employment" accounts, and some small-business breaks those folks have been after for a while.
But Bush didn't go to the Midwest to break news or dissect market dynamics or find common ground with Democrats he went to take his new Congress for a spin. From his speech it was clear that the true centerpiece of his plan was in fact quite familiar. Remember those 10-year income tax rate reductions he got passed in 2001? Bush wants them all this year, retroactive to January 1. "Speeding up the income tax cuts, we will speed up the pace of economic recovery and job creation," Bush said. "If tax relief is good enough for Americans three years from now, it's good enough for Americans now." Tough to argue with that.
The House Democrats, meanwhile, have an actual short-term economic stimulus plan: a fast-acting, temporary, perfectly reasonable combination of rebate checks, fiscal relief for states and short-term investment inducements with a net 10-year cost, they say, of about $36 billion. It would provide a measurable short-term boost to the economy. It won't break the budget. But as the Republicans gird for the spring's big battle, the White House seems to betting on two things besides Bill Frist and his slight numerical edge in the Senate. One, that people will overlook the costs when the budget's already busted. Two, that whether or not these tax cuts bring back the boom times or just sit there while the business cycle does the work, it'll all look the same to voters in, say, November 2004.
And by January 2005 he'll be a flat-taxer for sure.