June 8th, 2003
By
DAVID
FIRESTONE
The New York Times
The 47 Republican senators who voted on Thursday to increase
the child tax credit for 6.5 million low-income families were not, for the most
part, a happy band. Only a few spoke in favor of it, and most of those cited
the military families who would benefit. Trent Lott of Mississippi made a
gagging sound as he joined 93 other senators in voting aye.
Republicans made little effort to disguise the fact that they had essentially
been dragged into the vote by two weeks of bad publicity and unending
Democratic accusations that President Bush's new tax bill was heartless for
denying the families the credit.
Senator Charles E. Grassley, the Iowa Republican who is chairman of the Finance
Committee, sounded a bit sarcastic when he said his party was suddenly
confronted by "a great big enlightenment that it was a very important, unfair
treatment of one segment of people." He said there was one other reason for the
consensus: "The political volatility of it."
Democrats, who created that volatility and have had little else to boast about
during this Congressional term, did a brief and rarely seen dance of triumph.
"The Democrats in the House and the Senate made this issue too hot to handle
for the Republicans," said Representative Nancy Pelosi, the House Democratic
leader, on Friday.
Representative Jan Schakowsky, an
Illinois Democrat, said: "It seems as if we have hit a nerve here. We are
supposedly talking about a bill that would make it easier to get checks, and
the Republicans are clearly embarrassed that there are a whole lot of people,
in fact 12 million children, whose families are not going to get checks."
That embarrassment, however, does not appear to have seeped into the chambers
of House Republican leaders, where officials say they have no intention of
rubber-stamping the Senate bill. House leaders say they will provide refunds of
the $400-per-child increased credit to families making $10,500 to $26,625 only
as part of a much broader tax-cut bill. They want to make the child credit
permanent for 25 million wealthier families, as well, and to drop the Senate
provision that would pay for the cut by raising customs fees.
As a result, the House bill could cost up to $100 billion over the next 10
years, while the Senate bill is projected to have no cost to the Treasury. The
rival bills ensure many weeks of wrangling between the two chambers, which
would probably prevent the 6.5 million families from getting refund checks at
the same time as middle-income families.
The difference in approaches between House and Senate Republicans illustrates
what Representative Rob Portman, Republican of Ohio, says is a split in the
party's thinking on the subject. One group of Republicans, he said, thinks the
party cannot win the contest over the political perception of the tax credit
issue, and should just approve it and move on.
A second group, he said, feels strongly that Democrats have been
misrepresenting the issue to the public, and wants at least to have a debate
over the tax credits before the bill is passed. This group, he said, includes
him and other House conservatives who are not comfortable with giving increased
government checks to people who do not owe federal income tax.
"Probably, as in most things in Congress, the political pressure will win out,"
said Mr. Portman, chairman of the House Republican leadership group. "But I
still don't think we've explained this enough. This is not a tax issue -- it's
a government transfer payment to people who do not pay income taxes."
People who would benefit from the Senate bill do not pay federal income taxes,
though most pay Social Security and Medicare taxes. For many, the
$400-per-child check they would receive under the bill would come on top of the
existing $600 child credit and the earned income tax credit, which can be
several thousand dollars a year depending on income and the number of children.
Although cash refunds to low-income working people who do not pay taxes were
first approved under a Republican administration in 1975, and were increased
again under the Bush administration in 2001, many Republicans now argue that
further payments would be too much.
At least two Republican senators, Don Nickles and James M. Inhofe, both of
Oklahoma, say they agree with that criticism, and they were the only two to
vote against the credit on Thursday. Mr. Inhofe issued a statement on Friday
calling the bill "a redistribution of taxpayers' money to those who do not pay
taxes."
Their isolation from their party colleagues on the vote, however, makes clear
that most Republican senators are among those cited by Mr. Portman who want a
political problem to go away. Their political base is much broader than their
House colleagues', and every senator has thousands of constituents who would
benefit from the increased credit. House members, most with safer seats, can
afford to take a sharper ideological position.
"With a senator representing an entire state, they know they'll have to get
some votes from the other political party," said Glen Bolger, a Republican
pollster. "But lots of House members aren't in swing seats anymore, and it's
easier for them to stick to their guns."
Democrats made it clear this week, however, that they would try to exact a
political price if Republicans stalled the approval of the increased credits.
Although they have not been particularly successful up to now in generating
populist anger against the tax bill, the leaders of the two Democratic
Congressional campaigns said they considered the issue the illustration they
have been waiting for.
"We now have a visible and tangible issue that I think everyone understands,"
said Senator Jon Corzine of New Jersey, chairman of the Democratic Senatorial
Campaign Committee. "It's as clear a choice as possible between the children of
people who are working hard and playing by the rules, or people who earn money
from dividends and capital gains. It's kids versus capital."
Representative Robert T. Matsui of California, chairman of the Democratic
Congressional Campaign Committee, promised that his candidates would use the
issue heavily in next year's races against Republicans. He said, in fact, that
he was a bit surprised that Republicans were presenting his party with such a
clear-cut campaign issue.
"I think the Republican House members are being led off the cliff by Tom DeLay,"
he said, referring to the House Republican leader, who opposes the Senate bill
in its current form. "They're so intimidated and afraid of him that they won't
take him on. Eventually they're going to pay a price for this."
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