Campaign 2002: Once Again, it's the Economy

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Gentlemen, start your campaigns: Daschle

Goodbye, Sept. 11; hello, Nov. 5 — the 2002 electoral hunting season is officially open Friday — and it looks like it's going to be fought over last year's budget.

It really wasn't supposed to open until Saturday, when George W. Bush devotes his Saturday radio address to a discussion of the economy and flies to Oregon and California for some follow-up stumping, and the White House's economic team descends on the Sunday morning talk shows. But Senate Majority Leader and acting King of the Democrats Tom Daschle is still peeved about the $1.3 trillion tax cut that walked right over his dead body in the spring and helped bust the budget in the process — and he wasn't going to wait until Monday to start shooting. Friday afternoon, Daschle will hold his own afternoon presser on the economy and why he thinks the tax cut was a bad idea.

Of course, this shooting match isn't really about the past, it's about the midterm congressional elections that are now a scant 10 months away — and Daschle doesn't lack for ammunition. Congress' first order of business when it returns to work Monday will be to heed Treasury Secretary Paul O'Neill's plea and raise the current $5.95 trillion federal debt ceiling to $6.7 trillion, lest the U.S. government default on its paper, Argentina-style. And Friday morning Bush's own Labor Department gave Daschle a nice hook to work into his speech when it announces the unemployment numbers for December. (Up again, slightly, to 5.8 percent.)

Throw in the White House's own assessment that the budget will be in the red through at least 2004, and the battle lines are pretty clear. Democrats will tell America it needs more government spending — on unemployment benefits for the recession, and homeland security for the war — and because of Bush's tax cuts there isn't enough to go around.

Bush and the Republicans will pitch another round of tax cuts the same way they pitched last year's — by looking at the long term. Not only are tax cuts are the people's (and the corporations') money, they'll say, they represent the best way to ensure economic growth for years to come. The White House has even renamed the economic stimulus plan the "economic security plan," just to make the point. (Somebody must have held a focus group over the holidays.) Whereas Daschle's priorities are all screwed up — Washington shouldn't presume to spend the people's money itself in the first place (unless it's on defense), and if it does it sure shouldn't be wasting it by softening a recession that's about to end anyway.

The plan tends to leave congressional Republicans feeling a little nervous. Bush has until 2004 to bring the economy around (and, he'd better hope, the budget under control), which still looks like plenty of time. But House and Senate GOPers have to defend Bush's fiscal policy this summer and fall. The recovery is going to have to hurry to be noticeable by then — and the argument for tax cuts (which always seem to return more money to those who make more) has never polled well when times are tough.

Daschle lost this fight last year, when the surpluses were fat and the world was safe, but he was confident enough in it this winter to stare Bush down on the economic stimulus package and get called "obstructionist" by Dick Cheney. And now he's going to fight Bush's agenda, and eventually his budget, all the way to November. That's because Sept. 11 supposedly made Americans once again comfortable with a big, protective government.

But they may have also learned a lot about the economy since then, and not just that the downturn started on Clinton's watch. They've learned that business cycles happen, and recoveries take time, and they've noticed that Wall Street doesn't seem to worried about whether Congress passes an economic stimulus package at all, much less what kind it is. They've heard over and over that when America is hurting, the patriotic thing to do is to support their local business by going shopping, eating out, buying a house or a car or at least a DVD player.

Which means that for Bush this is not a bad time to be offering everybody a few extra bucks at tax time — if you could just forget about the budget for a few years — and not a great time for Daschle to be asking for last year's money back.