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Bush Seeks Permanent Tax Cuts


President Bush is at the presidential retreat at Camp David with White House speechwriters working on the State of the Union address. Mr. Bush used his weekly radio address to preview some of the economic themes he is expected to include in his speech to Congress later this month.

President Bush says recent gains in the U.S. economy are a result of his record tax cuts on personal income, small business equipment, dividends, and capital gains.

"Thanks to tax relief, spending restraint, and the hard work of America's entrepreneurs and workers, our economy today is strong," said Mr. Bush.

To keep the economy growing, President Bush says Congress needs to make those tax cuts permanent so Americans keep more of what they earn.

"Productivity is high, inflation is contained, consumers are confident, and more Americans now own their homes than at any time in our nation's history," said Mr. Bush. "Unfortunately, just as we are seeing how our tax cuts have created jobs and opportunity, some in Washington want to repeal the tax relief. Others want to just let it expire in a few years. Either way, they want to raise your taxes."

Opposition Democrats say Republican tax cuts unfairly favor wealthier Americans. Democrats are trying to capitalize on the president's poor public approval ratings on the economy, with one recent poll showing nearly 60 percent of Americans disapproving of the way Mr. Bush is handing the economy.

The newly-elected governor of the state of Virginia will give the Democratic response to the president's State of the Union address January 31. Democrats are trying to link the president's party with a series of scandals and ethics violations, some of which involve members of both parties.

In the Democratic radio address, the party's Senate leader Harry Reid said Republicans are to blame.

"Republicans today control the House of Representatives, the Senate, and the White House. They have absolute power and it has corrupted their party and lead to the culture of corruption that we now have in Washington, DC," said Mr. Reid.

Republicans say government corruption is a bipartisan issue and point to Democrats accused of taking bribes in a telecommunications deal.

President Bush is also expected to discuss health care in the State of the Union. He says he will ask Congress to allow people to put more money in tax-free accounts to pay medical expenses.

Senator Reid says increasing individual tax breaks for health care pulls wealthier Americans out of traditional insurance plans, thereby raising costs for the poorer people who remain.

"The State of the Union today is that we have low-income Americans begging for their prescription drugs and seniors going without any coverage," said Mr. Reid.

President Bush wants Congress to allow smaller businesses to pool their risk and buy health coverage at volume discounts enjoyed by larger firms.

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