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CNN SATURDAY MORNING NEWS

Controversy Over $350 Billion Tax Cut Bill

Aired May 24, 2003 - 07:12   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

MARTIN SAVIDGE, CNN ANCHOR: Now that the Senate has passed the $350 billion tax cut bill, it is off to the president's desk for his signature. But just because it's a done deal doesn't mean the controversy is over.
Our Jonathan Karl on Capitol Hill with more.

(BEGIN VIDEOTAPE)

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: The vice president votes in the affirmative...

JONATHAN KARL, CNN CAPITOL HILL CORRESPONDENT (voice-over): Not only did he cast the tie-breaking vote, Vice President Cheney also saved congressional Republicans from themselves. As the president's enforcer, he twice broke up fights among Republicans that threatened to kill the tax cut.

SEN. CHARLES GRASSLEY (R), CHAIRMAN, FINANCE COMMITTEE: He's kind of like a pastor coming in and settling a family dispute within the congregation.

KARL (on camera): And that's what he did.

GRASSLEY: The Republicans are a unified congregation because of Vice President Cheney.

KARL (voice-over): But Republicans are not completely unified. Senator Olympia Snowe denounced what she called gimmicks to make the tax cut look smaller than it really is, saying, "This is a trillion- dollar tax cut masquerading as $350 billion." And Speaker of the House Dennis Hastert agrees the tax cut could be much bigger. "It could end up being a trillion-dollar bill," he said, "because this stuff is extendable."

The stuff, temporary tax cuts Republicans are already saying they would like to make permanent.

(on camera): Do you expect these tax cuts to be renewed?

GRASSLEY: I do expect them to be renewed. In fact, even within the next year or so.

KARL (voice-over): If the tax cuts are renewed, the total cost skyrockets, and, Democrats charge, already bad budget problems get worse.

Whatever the ultimate cost, Democrats say it will directly increase the national debt.

REP. CHARLES STENHOLM (D), TEXAS: Is or is not the $350 billion tax cut that you have raved on all night going to be paid for by borrowed money? Yes or no.

UNIDENTIFIED MALE: We're going to pay for it by giving it back to the American people.

STENHOLM: All right...

UNIDENTIFIED MALE: Will there be deficits (UNINTELLIGIBLE)...

STENHOLM: ... I take back my time, I take back my time. I've heard that rhetoric all night. That dog won't hunt.

KARL (on camera): Within hours of the tax vote, the Senate voted to allow the government to add nearly $1 trillion more to the national debt, a reminder that even as Congress passes tax cuts, it is anticipating record budget deficits in the coming years.

Jonathan Karl, CNN, Capitol Hill.

(END VIDEOTAPE)

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