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Economy alters political weather

From tax cuts to environmental protections, an economy in flux changes the calculus of policy battles.

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After years of dealing with a blue-sky fiscal era, Washington is suddenly worried about the return of the politics of hard times. This doesn't mean the US itself is about to break out the bottles of red ink. So far, the government surplus is projected to remain strong for years to come.

But an unsettled economy is unsettling voters - and thus, inevitably, politicians too. Prospects for everything from George W. Bush's tax cut to his budget plan and beyond are changing like the weather on a blustery day, as Republicans and Democrats compete to see which party can appear to do the most to respond to recession concerns.

"In politics, you always want to get out in front of any particular problem," says Dennis Goldford, chairman of the political science department at Drake University in Des Moines, Iowa.

The clearest example of this new dynamic is the current partisan sparring over the timing of tax cuts.

Senate Democrats are almost gleeful over what they think is the cleverness of their proposal for a one-off $60 billion tax rebate for 2001. Their thinking goes like this: The Bush administration has long argued that economic weakness is a big reason why the nation needs tax relief now. That means the White House can hardly oppose the rebate - even if it siphons away support for Mr. Bush's much more expensive 10-year rate-cut plan.

Maybe so. But Democrats have gotten into trouble when trying to throw the GOP into a tax-cut briar patch before.

In 1980, Democratic counteroffers to Ronald Reagan's tax plan resulted in the final package becoming bigger. That could happen again - Bush has said he will support retroactive tax relief, even as he continues to insist that economic conditions warrant passage of his more expansive plan.


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