President Bush scored a major domestic political victory this week when he signed a tax cut bill into law that he hopes will stimulate growth in the U.S. economy. While economists are divided over the wisdom of this latest round of tax cuts, White House advisors are expecting that they will pay some major political dividends in next year's presidential campaign.
The measure signed into law by the president will cut taxes by $330 billion over the next 10 years. It is the third tax cut enacted by the Bush administration in a bid to jump-start the stagnant U.S. economy and create new jobs.
"By ensuring that Americans have more to spend, to save and to invest, this legislation is adding fuel to an economic recovery," Mr. Bush said.
President Bush is counting on the tax cuts to jump-start the economy. But even if they do not, administration officials are hoping that voters will remember the tax refund checks they will receive shortly during next year's presidential election campaign.
"No incumbent president has ever been re-elected in the midst of an election year recession," commented Allan Lichtman, a presidential historian at the American University in Washington. "George Bush knows that and is pumping as much stimulus into the economy as he can to make sure he gets through 2004."
With the president still riding high in public-opinion polls on foreign policy and national security issues, opposition Democrats have focused on the weak economy as their best and perhaps only hope of defeating Mr. Bush in 2004.
Connecticut Senator Joe Lieberman, one of nine Democrats seeking his party's presidential nomination, told Fox News that the short term gains from the president's tax cuts will eventually be undermined by the long-term budget problems they will create.
"The problem is they are betting our money," said Sen. Lieberman. "We are going into the greatest debt in the history of our country. It is coming out of the Medicare [older age health care subsidy] and Social Security [pension program] Trust funds. Our kids and we are going to have to pay it back."
Most political experts expect the Democrats to try and re-run the 1992 presidential campaign in which Democrat Bill Clinton emphasized economic issues in defeating the president's father, George Herbert Walker Bush.
"Yeah, I think they are going to try do a repeat of '92 [the 1992 election]," said Stuart Rothenberg, an independent political analyst in Washington. "They are going to acknowledge the president's successes in foreign policy, but they are going to go to the American public and say, 'It is the economy, stupid,' and George W. Bush has failed just like his father did."
The president's father faced criticism from both the right and left in 1992. Some conservative activists felt betrayed when Mr. Bush violated his pledge not to raise taxes as part of a 1990 budget agreement with the Congress.
Democrats and many political independents turned against him because they felt he was not doing enough to revive a weak economy.
The current President Bush worked in his father's White House at the time and saw firsthand the perils of ignoring public concern about economic issues.
Analyst Stuart Rothenberg doubts President George W. Bush will make the same political mistakes his father did.
"But this George W. Bush learned from his father; that it is important not to be a Pollyanna, not to say that everything is improving, everything is fine, but to acknowledge people's economic pains, to acknowledge the role of the government in stimulating the economy," he explained. "And so I think it may be harder for the Democrats to paint this President Bush in the corner the way they did with his father."
Mr. Rothenberg and other analysts say that the president will remain somewhat politically vulnerable as long as the economy remains weak. That is why the president and his Republican allies in Congress have so much riding on the success of the tax cuts enacted this week.