Return to Transcripts main page

Live From...

Stimulus Plans Coming Out Today, Tomorrow

Aired January 06, 2003 - 14:04   ET

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

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


KYRA PHILLIPS, CNN ANCHOR: Now off to Washington for the war of the tax cuts part two. President Bush is about to propose another economic stimulus plan, this one cutting various taxes and killing one tax entirely at a cost of some $600 billion over ten years.
He'll spell out the details in a speech tomorrow in Chicago, but CNN's Suzanne Malveaux can give us the highlights right now -- hi, Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Hello, Kyra. Absolutely right. President Bush will formally unveil that economic stimulus package tomorrow in Chicago, but this afternoon he's going to be talking about details of that package, at least with his cabinet members. But what we understand, it's going to be a $600 billion plan over the next ten years.

A senior administration official tells us that the centerpiece of this plan is really the elimination of the tax on stock dividends. That official telling us that it is a double tax, that dividends are taxed twice. They believe it's an issue of fairness. It's taxed the first time as corporate profits, and then taxed as income to shareholders.

The whole idea behind this, if you eliminate that tax, then shareholders will spend more, they'll invest more, and the stock market will get a boost. But critics already coming out saying, Look, this is not going to work, that this is only going to benefit the wealthiest Americans, the top 5 percent. But White House spokesperson Ari Fleischer earlier today defending the president's plan while not addressing any of the details of it, saying that there is something for everyone.

(BEGIN VIDEO CLIP)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: Under the president's proposal to provide tax relief, 92 million taxpayers will receive on average a tax cut of $1,083 in 2003. Forty-six million married couples would receive average tax cuts of $1,716. Thirty-four million families with children would benefit from an average tax cut of $1,473, and 13 million elderly taxpayers would receive an average tax cut of $1,384.

Final statistic I'm happy to give you, is a typical family of four with two earners making $39,000 in income would receive a total of $1,100 in tax relief under the plan.

(END VIDEO CLIP) MALVEAUX: Well, Kyra, you can bet that in the days to come, the analysts and economists will all be trying to analyze those numbers and figure out just who is getting what, but we are also understanding that in this package, he'll include an increase in the child tax credit. Also an extension of unemployment benefits as well as a decrease in the marriage penalty tax as well as federal dollars for needy states.

The administration is certainly hoping to push this through the House. They think they have a pretty decent chance of that, but it is going to be a lot more difficult in the Senate. They really need to get some Democrats on board. But again, the administration very much aware of how important this is to Americans and also for Election 2004 -- Kyra.

PHILLIPS: All right. Live from the White House, Suzanne Malveaux -- thank you.

Congressional Democrats, meanwhile, believe if you can't join them, upstage them. They'll unveil their stimulus package supposedly focused more on the poor and middle class just minutes from now.

CNN's Jonathan Karl can tell us about that -- Jon.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Well, Kyra, a much different idea coming from the House Democrats now led by Nancy Pelosi. First of all, their tax cut, their proposal for economic stimulus is much smaller, much less costly. It costs about $130 billion. All of that cost this year. The exact number is $136 billion for the first year. It includes a $300 per worker refundable tax credit. That is kind of like that tax rebate that was given to taxpayers in 2001. It also includes some business tax relief for new equipment and factory purchases, some aids to states that have been hit by the recession in their budgets. And also an extension of unemployment insurance which, for many people, expired back on December 28. If you look at the two plans side by side, the Democrats and the president's plan, there's virtually no common ground except for that question of extending unemployment insurance. Both sides say they agree with that. Although they agreed on that issue last December, and still couldn't come up with agreement. So there's a lot of daylight between Democrats and Republicans on this issue right now -- Kyra.

PHILLIPS: Jonathan Karl, live from Capitol Hill, thank you.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com






Aired January 6, 2003 - 14:04   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Now off to Washington for the war of the tax cuts part two. President Bush is about to propose another economic stimulus plan, this one cutting various taxes and killing one tax entirely at a cost of some $600 billion over ten years.
He'll spell out the details in a speech tomorrow in Chicago, but CNN's Suzanne Malveaux can give us the highlights right now -- hi, Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Hello, Kyra. Absolutely right. President Bush will formally unveil that economic stimulus package tomorrow in Chicago, but this afternoon he's going to be talking about details of that package, at least with his cabinet members. But what we understand, it's going to be a $600 billion plan over the next ten years.

A senior administration official tells us that the centerpiece of this plan is really the elimination of the tax on stock dividends. That official telling us that it is a double tax, that dividends are taxed twice. They believe it's an issue of fairness. It's taxed the first time as corporate profits, and then taxed as income to shareholders.

The whole idea behind this, if you eliminate that tax, then shareholders will spend more, they'll invest more, and the stock market will get a boost. But critics already coming out saying, Look, this is not going to work, that this is only going to benefit the wealthiest Americans, the top 5 percent. But White House spokesperson Ari Fleischer earlier today defending the president's plan while not addressing any of the details of it, saying that there is something for everyone.

(BEGIN VIDEO CLIP)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: Under the president's proposal to provide tax relief, 92 million taxpayers will receive on average a tax cut of $1,083 in 2003. Forty-six million married couples would receive average tax cuts of $1,716. Thirty-four million families with children would benefit from an average tax cut of $1,473, and 13 million elderly taxpayers would receive an average tax cut of $1,384.

Final statistic I'm happy to give you, is a typical family of four with two earners making $39,000 in income would receive a total of $1,100 in tax relief under the plan.

(END VIDEO CLIP) MALVEAUX: Well, Kyra, you can bet that in the days to come, the analysts and economists will all be trying to analyze those numbers and figure out just who is getting what, but we are also understanding that in this package, he'll include an increase in the child tax credit. Also an extension of unemployment benefits as well as a decrease in the marriage penalty tax as well as federal dollars for needy states.

The administration is certainly hoping to push this through the House. They think they have a pretty decent chance of that, but it is going to be a lot more difficult in the Senate. They really need to get some Democrats on board. But again, the administration very much aware of how important this is to Americans and also for Election 2004 -- Kyra.

PHILLIPS: All right. Live from the White House, Suzanne Malveaux -- thank you.

Congressional Democrats, meanwhile, believe if you can't join them, upstage them. They'll unveil their stimulus package supposedly focused more on the poor and middle class just minutes from now.

CNN's Jonathan Karl can tell us about that -- Jon.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Well, Kyra, a much different idea coming from the House Democrats now led by Nancy Pelosi. First of all, their tax cut, their proposal for economic stimulus is much smaller, much less costly. It costs about $130 billion. All of that cost this year. The exact number is $136 billion for the first year. It includes a $300 per worker refundable tax credit. That is kind of like that tax rebate that was given to taxpayers in 2001. It also includes some business tax relief for new equipment and factory purchases, some aids to states that have been hit by the recession in their budgets. And also an extension of unemployment insurance which, for many people, expired back on December 28. If you look at the two plans side by side, the Democrats and the president's plan, there's virtually no common ground except for that question of extending unemployment insurance. Both sides say they agree with that. Although they agreed on that issue last December, and still couldn't come up with agreement. So there's a lot of daylight between Democrats and Republicans on this issue right now -- Kyra.

PHILLIPS: Jonathan Karl, live from Capitol Hill, thank you.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com