Rich Help

Rich Help

Rich Help

A summary of what's in the major U.S. newspapers.
Feb. 9 2001 7:42 AM

Rich Help

The Washington Post and Los Angeles Times lead with President Bush's forwarding to Congress yesterday his $1.6 trillion/10-year tax cut proposal. USA Today leads with President Bush's "deepest foray into Middle East diplomacy": phone calls he made yesterday to Yasser Arafat and the leader of Oman and those made by his Secretary of State Colin Powell to Arafat, the president of Tunisia, Russia's foreign minister, and the United Nation's Kofi Annan. The paper says Bush expressed to Arafat U.S. support for a just and lasting peace, in a call that transpired shortly before a car bomb exploded in an Orthodox Jewish neighborhood of Jerusalem, injuring a 65-year-old woman. Next step: Powell's visit to the region later this month. The New York Times leads with Bush's ordering up of a review of the U.S. nuclear arsenal, which would likely be used as the basis for making unilateral cuts in the number of warheads and missiles, a reduction he'd promised during the campaign. The paper says the cuts are expected to ultimately take the current 7,500 U.S. warheads down below 2,500. The Times also observes two political angles to the development: 1) It may ease anxieties about the development of a U.S. missile shield system, which the Bush administration is determined to pursue; 2) it may cause tension between Bush and the military's top officers, already "dismayed" by Bush's decision not to increase the military budget this year.

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The coverage makes it clear that the Bush tax proposal remains as was described earlier in the week: lowering marginal rates, doubling the child tax credit, reducing the tax burden on many married couples, and eliminating the estate tax. The WP lead says Bush's $1.6 trillion figure "likely underestimates the cost of the plan to the treasury" and immediately cites "some analysts" who put the price tag "above $2.5 trillion." The LAT, citing "a liberal research organization," says "$2.1 trillion." The main cause of the inflation appears to be the added costs of making the tax cut retroactive to Jan. 1, 2001, a feature which is not formally in Bush's proposal, but which he endorsed yesterday.

Both the LAT and the WP go high with Bush saying that he's making his tax cut pitch because "a warning light is flashing on the dashboard of our economy." He's also quoted describing the giveback as "urgent" and what "these uncertain times demand." But how bad can the economy be, given today's USAT front-page cover story, "PERSONAL CHEFS ARE NO LONGER JUST FOR THE RICH"?

But even if there is an emergency, the LAT emphasizes doubts about whether the cuts could work as an emergency response, saying "some analysts" challenge whether any tax cut would be fast enough, and saying "many economists" think this one isn't big enough to change people's spending habits. The paper adds that when asked to provide the economic rationale for the cuts, Bush's economic adviser Lawrence Lindsey, said, "I might refer you to your economics textbook from freshman year for the answer." The NYT reports Lindsey's similar reticence when he was asked to explain why the plan provides no relief to the working poor.

The tax cut leads point out that the Bush plan faces congressional pressure both from Democrats wanting more middle- and lower-class tax relief and from Republicans wanting more tax relief for businesses and for people who have investments. The WP has a Bush aide saying that during a recent White House meeting, when a member of the House Ways and Means Committee was making the case for adding a cut in the capital gains tax, Bush replied, "That's not what I'm going to do."

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The papers note that in making his pitch, Bush referred to the tax cuts endorsed by John F. Kennedy 40 years ago. It's the NYT off-lead that points out that those times were very different, with a top tax rate of 91 percent (as opposed to 39.6 percent now) and little in the way of government debt.

The papers love to pawn off onto others controversy or disagreement in news stories, and with tax plans, this is understandable, since they are so complicated. But this also has become too much of a reflex. For instance, the NYT notes that the Bush plan offers little to families of four making under $25,000 because they already pay little or no income tax, but feels the need nonetheless to put in the mouth of unnamed "Democrats" the obviously true assertion that therefore alleged gains for these folks in the plan are "illusory." Similarly, the WP lead says, "The richest Americans would especially gain from repeal of the estate tax, Democrats say."

Both the WP and NYT note that in a counter press event, the Senate's top Democrat, Thomas Daschle, showed up with a Lexus loaded with extras, saying that if you're a millionaire, under the Bush plan, you'll get enough money back to pay for the car. But if you're a typical working person, you'll get enough to buy a muffler, which Daschle also had on hand. Obvious follow-up the papers don't ask: Where'd the car come from? Is it Daschle's? Some other senator's or Senate staffer's?

The fronts pick over yesterday's House hearings looking into Bill Clinton's pardon of Marc Rich. The NYT emphasizes that testimony there revealed that Rich's ex-wife--who herself refused to testify, citing her right against self-incrimination--had, according to one of her lawyers, pledged money to the Clinton presidential library in Arkansas. The paper has a Democratic fund-raiser saying that her pledge was for nearly $1 million. The Times piece also reports that e-mail correspondence produced for the hearings reveal that Rich lawyers discussed approaching Sen. Hillary Clinton on the matter, but the paper says it's "unclear" whether this was ever done. (Suggestion to editors: Whatya say we get clear on that?) The Wall Street Journal daily pardon situation report also has Ms. Rich's "enormous" donation to the library, but goes higher with one pardon recipient who had only one known connection to Bill Clinton, a convicted coke dealer who said in court once that he got cocaine from Roger Clinton, also pardoned by the former president. The WP front-page effort goes high with the need for secrecy emphasized by Rich's advocates as they pursued their goal. Widely reported is a Clinton administration DOJ official's testimony: "Knowing everything that I now know, I would not recommend to the president that he grant the pardon."

The WP reports today that in new academic articles, political scientists try to explain why their mathematical models, mostly based on economic conditions and public opinion polls, mistakenly predicted that Al Gore would win the election, in many of the models by a comfortable margin. The story appears on Page 10. The story the Post ran last May when it first reported these Gore-favoring predictions ran on Page One.

Beg pardon, but back to the pardons: The WP's Al Kamen reports that e-mails reveal the most extraordinary effort yet considered by the Marc Rich team. In late December, Rich lawyer Jack Quinn apparently asked if Leah Rabin, widow of the slain Israeli prime minister, could be enlisted in the cause. The response came back to another lawyer on the team: "[H]aving Leah Rabin call is not a bad idea. The problem is how do we contact her? She died last November. ..."