The Salina Journal from Salina, Kansas on May 4, 2001 · Page 4
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The Salina Journal from Salina, Kansas · Page 4

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Friday, May 4, 2001
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M FRIDAY, MAY 4. 2001 WASHIMBTOM THE SAUNA JOURNAL • TAXES Rebate support evaporating Chairman of Senate Finance Committee tall<s about tax debate By The Associated Press WASHINGTON — Congress is unlikely to approve tax rebate checks this year, seeing less of a need to stimulate the economy, Senate Finance Committee Chairman Charles Grassley said Thursday He also said the votes aren't there to lower the highest income tax rates to 33 percent as President Bush wants. : Grassley, in an interview with Associated Press reporters and editors, said the Bush administration "is still trying to find a way" to give taxpayers some of the budget surplus through rebate checks. But he said enthusiasm for it in Congress has waned amid evidence the U.S. economy grew 2 percent in the first quarter and questions about how the program would work. "There's a feeling that maybe that is not needed now," Grassley said. "You don't even hear the Democrats talking about it." I The Finance Committee, levenly divided between Repub- !licans and Democrats, is .searching for compromise on the tax cut elements that would fit into an 11-year, $1.35 trillion package that is much lower than Bush proposed. In the interview, Grassley laid out an ambitious agenda beyond taxes for the committee this year, including action on Medicare prescription drugs and a comprehensive trade bill. "You're going to find me and my committee right in the middle of the things the president wants to accomplish," said Grassley who travels home to Iowa every weekend and still lends a hand at his family's 1,400-acre corn and soybean farm. Haggling at one-third line On income tax cuts. Bush has repeatedly insisted that no taxpayer should pay the federal government more than a third of his income. But Grassley said 12 of the 20 Finance Committee members now oppose reducing the current 39.6 percent T FOREIGN POLICY and 36 percent rates to 33 percent as part of the 11-year, $1.35 trillion tax cut compromise. "I hope we can get a consensus for something not too far above 33 percent," he said. One number suggested for the highest income tax rate is 35 percent, which would ensure all the tax brackets are reduced. It also is equal to the corporate income tax rate. Democrats and moderate Republicans want more of the tax cut to flow to lower-income people, arguing that they need a greater share of the overall tax relief. Maine GOP Sen. Olympia Snowe, for example, is pushing a plan to enable lower- income people to claim the $500 child credit — which Bush wants to raise to $1,000 — even if they don't pay income taxes. "In order to get a compromise, we may have to accept something in that area," Grassley said. Other proposals to make the tax cuts bigger for lower- and middle-income people would also give Congress a way to provide more tax relief this year and' next — even if rebate checks are not approved — by letting people keep more of their paychecks. One option, Grassley said, is to drop the bottom 15 percent rate to 10 percent more quickly than Bush proposed and widen income limits on the two bottom tax brackets so that more people are paying a greater share of their taxes at lower rates. other proposals discussed Besides the income tax cuts, Grassley said the package would probably include versions of Bush's proposals to repeal the estate tax, double the child credit and ease the marriage penalty paid by millions of two-income couples. The goal is to have a bill with broad bipartisan support on the president's desk before Memorial Day, or at least out of the Senate by then, he said. Grassley didn't rule out adding unspecified items sought by individual senators, but he said there was little support for Bush's plan to permit charitable deductions for taxpayers who don't itemize. "They're dead until we get a The Associated Press Senate Finance Committee Chairman Sen. Charles Grassley, R-lowa, gestures Thursday during an interview with the Associated Press in Washington. ... projection that says we've got a lot of money that we didn't anticipate having," Grassley said. But he added: "In ordeir to get a bipartisan agreement, we may have to include more, not less ... but not from the president's list." On other Finance Committee issues, Grassley: •, Set an Aug. 1 target for the committee to complete a bill revamping Medicare and providing a limited prescription drug benefit targeted at the neediest seniors. It would then go to the full Senate when Congress returns after Labor Day The budget compromise between Bush and Congress sets aside up to $300 billion over 10 years for a drug benefit, about double what Bush proposed but far short of what's needed to provide universal coverage. "We're going to start at the bottom of the economic ladder and work our way up until we run out of money," Grassley said. • Said the committee will try to write a comprehensive trade • bill in June renewing the president's authority to negotiate new trade agreements. He said he would try to find compromise on the divisive issue of protecting labor rights and the environment. The package also could include an agreement with Jordan and provisions establishing trade relations with Vietnam. • Said Bjash's proposal to let younger workers voluntarily invest Social Security payroll taxes in private accounts shouldn't be judged on current market volatility because the stock market will provide a better return than the current program over the long term. "The short-term issues are offset by the security of the next 75 years," he said. Administration takes tougher policy line Spokesman says Bush's stance more cautious, deliberate By The Associated Press : WASHINGTON — In his first three months in office, President Bush has hardened the American line on China, North Korea and Russia. This administration sees little to gain from business as usual overseas. As Bush put it Thursday: "We've got to review all policy that we inherited." Defense Secretary Donald H. Rumsfeld's slip this week on China policy — first suspending all military contacts, then adjusting that to require all future contacts to be approved in advance — demonstrated the difficulty of knowing how tough to get without crippling relations and undercutting U.S. interests abroad. • And yet, as the president also made clear this week in proposing to open a new strategic dialogue with Russia, the administration's tougher stance does not mean it sees no value in pursuing cooperation. "The president and his team genuinely have a different degree of skepticism" about the value of the diplomatic engagement with Russia, China and others that was emphasized by the Clinton administration, said Alton Frye, a foreign-policy expert at the Carnegie Endowment for International Peace. "Once they have recalibrated a stance, then they'll do business. So this is not an end to business, this is a resetting of the baseline from which business is done." Even on China, which Bush views as a strategic competitor rather than partner, the president struck a measured tone Thursday in explaining why Rumsfeld decided that he must review and approve in advance all future contacts and activities with the Chinese military PENTAX "We've only been in office for 104 days. We've got to review all policy that we inherited." President Bush on a case-by-case basis. "What the secretary was rightly doing was saying that we're going to review all opportunities to interface with the Chinese. And if it enhances our relationship, it might make sense. If it's a useless exercise, and it doesn't make the relationship any better, then we won't do that," Bush said. "We've only been in office for 104 days. We've got to review all policy that we inherited. But what the Chinese must understand is that we'll be firm in our philosophy consistent in our beliefs, and we want to work to have a relationship that is a positive relationship for both countries." 'More measured approach' A Rumsfeld spokesman. Rear Adm. Craig Quigley, said the defense secretary believes the United States should take "a more measured approach" to military-to-military relations with China, that U.S. military openness must be reciprocated. "This is a more cautious and prudent and deliberate step than the old way" Quigley said, adding, "This is not business as usual with the Chinese government at any level." The same could be said of the administration's approach to Russia, North Korea and Iran. Rumsfeld has accused Russia of contributing to the global spread of weapons of mass destruction, and the administration has balked at pursuing the missile-limitation talks with North Korea started by the Clinton administration. On Capitol Hill Thursday Secretary of State Colin Powell struck a sterner tone toward Iran. Powell said the United States will be ready to open official talks with Iran "when engagement makes sense." The administration has been rhostly silent on Iran since taking office, and Powell's comments seemed to mark a switch from the Clinton's policy of seeking a dialogue with Tehran without conditions. Business vs. security Dan Goure, a foreign policy expert at the private Lexington Institute, said the administration's intent is to "decouple" America's business interests from its security interests. He cited the example of Taiwan, which is the primary source of U.S. tension with China. Bush has shown he is willing to sell advanced weapons to Taiwan, over China's strong objections, even at the risk of hurting U.S- China trade. "This administration believes trade is something that is good in its own right and should be continued" independently of any security complications in the U.S.-China rela-, tionship, Goure said. In relations with the world generally "this administration is taking a stronger line — I would not say harsher line," he said. T BUSH-MIDDLE EAST found with Bush Rift between Peres and Sharon moves to tiie forefront By The Associated Pres^ WASHINGTON — Israeli Foreign Minister Shimon Peres cemented ties with President Bush Thursday but was ensnared in a long­ distance rift with Prime Minister Ariel Sharon on their assessment of Palestinian violence. Praising Bush as informed and decisive, Peres said after a White House meeting, "We see eye to eye on how to handle the peace process." Also, Peres told reporters, the United States was giving the highest priority to countering terr^orism in the Middle East. Back home in Jerusalem, Sharon's office said Palestinian leader Yasser Arafat had given a "green light" for attacks against Israel. This seemed designed to counter remarks by Peres earlier in Washington that "some dissident groups and some forces under Arafat participate in the killings without the knowledge of Arafat." Peres sought to play down any appearance of a rift. "We've never denied we come from two different schools of thought," he said. But, Peres said, the Israeli leaders agreed on stopping terror and returning to negotiations. "We are a democracy and don't get orders every morning what words to .use," Peres said. Different approaches The hawkish Sharon and the dovish Peres long have taken different approaches . on issues in the Arab-Israeli dispute. Now serving with Sharon in a unity government, Peres said, "I can assure you that whatever I say and Sharon says is coordinated." Peres also credited the prime minister with trying to improve living conditions for the Palestinians — a goal Peres has stressed during his visit to Washington, saying repeatedly he did not consider Palestinians an enemy Sharpening his rhetoric, Peres urged Arafat "to take a clear stand against terrorism." "We are not asking for miracles or things he cannot do, but to stand up against terrorism," the foreign minister told the Americaii Jewish Committee Thursday. "We would like to have a clear commitment from him. We cannot have a little bit of terrorism and a little bit of diplomacy" From there, Peres went to PERES BUSH the White House and later said he came away from the meeting with Bush "reassured and with a sense we can move ahead." 'He doesn't Impose' Peres, who urged the administration to act as a "facilitator" but not mam negotiator in peacemaking with the Arabs, said of Bush: "He doesn't want to impose; he wants to help." Bush praised Peres as "a fine' statesman" and said he left the White House "knowing full well that this administration is actively engaged in, first and foremost, trying to break the cycle of violence that grips that part of the world." "I do feel better having talked to him," Bush told reporters. Peres meets with Rice Peres also met separately with Condoleezza Rice, the president's national security adviser. White House spokesinan Ari Fleischer said the meetings "focused on efforts that are under way to end the violence, to rebuild trust and confidence and to return to a dialogue in the region." Bush has had Sharon and a handful of Arab leaders to the White House, but not Palestinian leader Yasser Arafat. That prompted criticism Thursday from Faisal Husseini, who is on the Pales- ting Liberation Organization Executive Committee in charge of Jerusalem affairs. "The Bush administration must invite Yasser Arafat and must invite him quickly" Husseini said at the National Press Club. "They can't go on listening only to the Israeli side." Meantime, Secretary of State Colin Powell said the . administration was considering asking Congtess for a supplemental appropriation to assist Israel's armed forces. Their expenses have soared because of seven months of violent conflict with Palestinians. "We have it under consideration," Powell testified at a hearing of a Senate Appropriations subcommittee. Once the level of violence in the area is reduced, tow- ell predicted, Sharon will be "very forthcoming" concerning a resumption of economic activity between "Israel and the Palestinian territories. Twenty-five years of food, fun and good times. And the best is yet to come. We've wrapped it all up neatly in a great commemorative package to let our readers remember some of the special things from previous Festivals and to introduce them to the exciting plai\s for this year's event Don't miss the opportunity to reach over 87,000 Salina Journal readers as a part of this memorable Festival Guide. DEADLINE: PUBLISHES: THURSDAY, MAY 17 SUNDAYJUNE 3 2320 Planet Galajty Center, 827-2497 3450 S. Ninth, salina, KS UNGIMRnUhB 823-2237 • 800-874-6316 Call your Salina Journal Marketing Consultant at (785) 823-6363 or 1-800-827-6363 e-mail us at sjadv@saljoumal.com '^^ Salina Journal Connecting communities with infonmtim

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