Where is Bush's tax-cut plan?

He's Been Working on It Since Beginning of Year

Some wag once said that, if every economist in the world were laid end-to-end, they would never reach a conclusion.

This appears to be what is happening to George W. Bush's large team of economic advisers, who have been delaying his longawaited tax-cut plan for the 2000 campaign because they have been unable to reach a consensus on its fiscal details.

When the Texas governor began his quest for the Republican nomination, he said lowering income-tax rates would be one of the most important proposals of his campaign. His political advisers said he would unveil his tax proposals early this fall.

But the September rollout time was pushed back to November and then to December. It could be postponed yet again if the budget fight between the Republicans and President Clinton is still being waged at year's end. In any event, Bush's economic experts say they are still tinkering with it and are in no hurry to get their job done.

"We're still working on it," said Lawrence Lindsey, the former Federal Reserve Board member who is heading Bush's team of economic advisers. "There is no disagreement. We want to be sure it's a quality proposal," he told me.

But others on the team say there has been some internal disagreement among Bush advisers over the evolving plan. At the same time, there is fear in Bush's inner circle that any tax-cut plan released now would be drowned out by the end-of-thesession budget battle in Congress.

"They wanted to make sure that the Bush tax-cut plan was unveiled after the Republicans' tax-cut bill was either enacted or defeated," said Grover Norquist, who heads Americans for Tax Reform and is one of Bush's tax-cut advisers.

"If you are Bush, you don't want to get your tax-cut message confused in the shift@ing lines of the fight between Clinton and Congress," Norquist said.

"If they're still fighting over the budget in December, it will be wiser for Bush to put the plan off until next year, because the fight will only muddy his message," he said.

'At This Point, There Is No Plan'

Bush's economic and political advisers have been working on the plan since the beginning of the year. But as of yet, insiders say the plan is still not near completion.

"At this point, there is no plan. It's still evolving," said J.D. Foster, who heads the independent Tax Foundation here and is one of Bush's tax-cut advisers.

"It's still a work in progress. There have been disagreements, but nothing major," said another member of the Bush campaign team, who did not want to be identified.

Yet there have been reports of significant internal differences over the plan's details, according to economists close to Bush advisers. Lindsey is said to be cool to the idea of further cutting the capital-gains tax rate so soon after it was cut from 28% to 20% two years ago.

Lindsey, an ardent tax-cutter, wants an across-the-board reduction in tax rates. But others on his team are said to oppose the idea, preferring more targeted changes in tax credits and other tax deductions for middle-and lower-income workers.

The marginal tax-rate cuts being considered are reportedly in the 10% range, below even the modest 15% cut proposed by Bob Dole in his unsuccessful 1996 presidential bid.

Bush has said he wants to lower tax rates to stimulate capital investment, which will boost long-term economic growth and jobs.

But he wants the plan to avoid the appearance of being heavily tilted toward upper-income people, creating a dilemma for his advisers. Across-the-board cuts by their very nature help wealthier people more because they pay the most taxes.

Bush Doesn't Have Luxury of Waiting

Another problem for Bush's team is the difficulty of projecting revenues and other economic conditions for a plan that probably would not take effect until 2002.

"Trying to design a fiscal program two years hence without knowing how much revenues we'll have this year or next is incredibly difficult," Foster told me.

"There isn't any problem as to disagreement. We're reaching conclusions. Reaching one conclusion is the problem," he said.

Ronald Reagan did not have a specific tax-cut plan until after he was nominated in the summer of 1980. The plan was Jack Kemp's 30% across-the-board tax-rate cut that changed the face of Republican politics and led to two decades of economic growth.

But Bush does not have the luxury of waiting that long. The compressed, fastmoving 2000 presidential primary schedule, which will sew up the nomination by March 7, demands that he unveil his tax-cut proposals soon.

Some of Bush's remaining rivals are beginning to say he has no plan because he doesn't know what he wants.

"The lack of a plan is due to the fact that the candidate himself doesn't know what he believes and he's seeking advice from a number of advisers who apparently have very divided views," says Steve Forbes's campaign manager Bill Dal Col.

Criticisms like that are only going to grow in intensity if Bush's plan is delayed much longer.