Besides Pain, Clinton Seeks to Dish Out Spending, Tax Breaks With AM-Clinton-Economy Bjt
WASHINGTON (AP) _ The focus of President Clinton’s economic recovery plan is the pain of deficit reduction, but the program bears goodies as well: nearly $200 billion in spending increases and tax breaks that shed light on the new administration’s priorities.
From computer-guided cars to extra Head Start centers for pre-schoolers, Clinton wants the government to pour federal dollars into projects he believes will make the country’s economy more productive and ultimately stronger.
It all goes back to his campaign pledge to ″rebuild America.″ And like his massive deficit-reduction plan, he says that making long-term investments now will add economic muscle for America in the long run.
″The consequences of this, we hope, are to produce jobs, target public and private investment, and improve the economy,″ Leon Panetta, Clinton’s budget chief, told the House Budget Committee Thursday, a day after the president unveiled his plan to the nation.
The so-called ″investment″ proposals directly reverse a key precept of Republican economic doctrine: federal spending is the beast fueling record budget deficits, and it must be slashed. It was a point that did not go unnoticed by some GOP leaders.
″It’s nothing but pork-barrel spending,″ Rep. John Kasich of Ohio, ranking Republican on the House Budget Committee, called some of the spending.
Across the Capitol, Sen. Pete Domenici of New Mexico, ranking Republican on the Senate budget panel, asked how he would improve Clinton’s plan, said, ″Why not just start by not adding″ billions of dollars worth of new programs.
Clinton’s investment initiatives are broken into two parts.
He would use about $30 billion over the next two years for spending increases and business tax cuts to give a quick boost to the still-sluggish economy.
The major goal: to create jobs. His main targets: public works, environment and technology projects; housing and community development; and education and health programs.
Thus, he would increase spending by nearly $3 billion for road projects, by $500 million to add summer school slots for low-income children, and by $200 million for AIDS prevention efforts.
For two years, he would also grant a tax credit to large businesses investing in new equipment.
Then, from 1994 to 1997, he’d dispense another $160 billion in spending increases and tax breaks to improve the country’s work force and physical facilities. For Clinton, this means making people smarter and healthier, and modernizing old roads and equipment.
Included is money to help develop technologies for ″smart cars″ and ″smart roads″ that would use computers to give drivers warnings and information.
Also: $1.3 billion to help communities purify drinking water; $1.5 billion to help defense contractors switch to production of civilian goods; and $8 billion more for Head Start.
He would also provide $60 billion in tax reductions, mainly for business and investors, designed to encourage research and equipment purchases, to spawn new companies in inner cities, and other activities.