Bush and Taxes: The New Agenda

It didn't take long to hit me: Iraq is so over. Why else would I be seated at the table with George W. Bush in the Roosevelt Room along with nine other economic writers, at Bush's invite? Where was the White House press corps? Nowhere in sight — and that's the point. The president wants to change the subject. We weren't likely to weigh down this meeting with questions about Saddam, Sunnis or Shiites.

So for most of 45 minutes last Tuesday morning the topic was all about "the other aspect of American security," as Bush put it — jobs and the economy. As he prepared to barnstorm the country for his plan to eliminate the tax on dividends and accelerate income-tax rate cuts, the president was in no mood to go off message. "We understand capital," Bush asserted, laying the groundwork for his central argument that tax cuts spur growth and serve as a cure-all for most economic ills. "I remember in the '80s, when people said we will have deficits forever," Bush said. "The next thing I know is that in the late '90s we begin to get into surplus. We've got to generate additional growth to get additional revenues."

Bush may be gathering a bit of a tailwind. Corporate earnings last quarter beat expectations for the first time in years. The Dow is up 10% in six weeks. Consumer confidence has risen. Bush's position is that while people have cause for concern, things aren't so bad, considering. "We've been racked with inflation, scandal, war and emergency," he said. "Yet we're still growing." All of that is true — OK, except for the part about inflation, which is at a four-decade low. Such economic misspeak underscores the difficulty Bush may have preaching on a subject where even experts can be incomprehensible.