Business Leaders Generally Praise Bush’s Economic Plan, Some Skeptical
NEW YORK (AP) _ Business executives generally praised President Bush’s plan to revive the economy as outlined in his State of the Union address Tuesday night, but some were skeptical of whether it went far enough.
Economists, meanwhile, were surprised by Bush’s proposal to lower income tax withholding rates and said it could provide an economic stimulus.
″The president’s economic growth package is right on course. In fact, it’s a road map for recovery,″ said William A. Schreyer, chairman and chief executive officer of Merrill Lynch & Co.
AT&T Chairman Robert E. Allen called the speech ″encouraging.″
″In particular, I was pleased the president has put a hold on new regulations and asked for a high-level review of current ones,″ Allen said in a statement.
But Martin J. Holleran, a top executive of Thomson Consumer Electronics, maker of RCA and GE televisions, said the steps Bush proposed may not be enough.
″There wasn’t any astronomically new thing,″ he said. ″I don’t think it’s sufficient.″
Holleran pointed out that many of the economic changes Bush is seeking, such as a cut in the capital gains tax, require congressional approval, ″and the Democrats are against almost everything″ Bush proposed.
Economist Maury Harris of the investment firm PaineWebber Inc. said Bush’s plan to temporarily lower income tax withholding rates could provide a boost to the economy. Bush said his proposal, which would reduce the amount the government takes out of paychecks, could add $25 billion to consumers’ pockets.
The administration said that the Internal Revenue Service can make the change without congressional approval.
″That means you can get a little more kick sooner than expected,″ Harris said.
Economist Lawrence Chimerine of DRI-McGraw Hill, an economic forecasting firm, said reducing withholding rates ″is not a bad idea because as a rule, people tend to have more withheld than they really owe.″
But overall, Chimerine called Bush’s proposals a disappointment. He said they will do little to increase the nation’s savings rate or promote long-term investments.