Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, January 29, 1992 TAG: 9201290297
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
SOURCE: From The Los Angeles Times and The Associated Press
DATELINE: WASHINGTON LENGTH: Long
PRESIDENT BUSH, TRYING TO RALLY A FEARFUL
President Bush, trying to rally a fearful and recession-weary nation, declared in his State of the Union address Tuesday night that hard times "will not stand" and offered economic proposals intended to put more money in the hands of taxpayers.He also discussed the benefits of a reduced military threat from the disintegrated Soviet Union. "The American taxpayer bore the brunt of the [Cold War] burden, and deserves a hunk of the glory," he said.
Bush said he would ask Russian President Boris Yeltsin on Saturday to agree to eliminate all land-based multiple warhead ballistic missiles. If Yeltsin agrees, Bush said, the United States will eliminate all MX missiles, reduce the number of warheads on Minuteman missiles to just one and cut the number of warheads on sea-based missiles by about one-third.
The most immediate elements of Bush's plan could be felt within days: He ordered an adjustment of federal tax-withholding tables to let wage earners reduce the amount of money withheld from their paychecks.
He called for a long list of tax changes and other steps that will be the subject of congressional debate for weeks and months to come.
Seeking to regain the unanimity of spirit that blossomed during the Persian Gulf War one year ago, Bush said in his speech before a joint session of Congress and a nationwide television and radio audience:
"We are going to lift this nation out of hard times inch by inch and day by day, and those who would stop us had best step aside. Because I look at hard times and I make this vow: This will not stand."
He urged Congress to put aside partisan considerations at the start of an already volatile election year and demanded action by March 20 on the heart of his economic program.
"My friends: The people cannot wait. They need help now," Bush said.
The challenge for the president was to lay out an economic and social program that would not only lift the spirit of a nation but give life to his campaign theme - the blunt message: "I care."
Nine and a half months before Election Day, the country's economic woes - marked by unemployment hovering at 7 percent, rising bankruptcies and falling real estate values - have created an unease among the electorate and a sense of struggle in the president's camp, where only a year ago the far-away political campaign appeared to offer little challenge.
Thus, the speech, while calling for a non-partisan attack on the problems of the moment, was delivered in one of the most partisan of times.
That is one reason he focused such attention on the change in income tax withholding tables. That step requires no congressional action.
Although it will have no impact on the total amount of an individual's annual tax payment, administration officials said it would allow each taxpayer, on average, to reduce annual tax withholding by $350 a year - or $7 a week.
The cost to the government, they said, would be a $25 billion increase in the annual federal budget deficit.
Bush offered few details of his proposals to make health care available to the 35 million Americans who have no health insurance coverage - an issue moving to the fore in the election campaign.
He said that his plan, over which some of his closest aides are still arguing, would provide a health-insurance tax credit of up to $3,750 for each low-income family. It also would provide access to basic health insurance for Americans "even if they change jobs or develop serious health problems."
Earlier in the day, a group of activists and homeless people held what they called the "real state of the union" speech across the street from the White House. David Hayden and a group of about 15 other residents of Roanoke's Justice House community of poor people participated.
Mary Strole-Wiram, an Indiana woman who described herself as a "friend of Justice House," said about 500 people attended the noon protest event calling for increased aid for housing for the poor.
A few of the organizers including Hayden were arrested when they refused to move away from the White House gate. Strole-Wiram said Hayden was to have been released late in the afternoon and the Justice House residents planned to return to Roanoke late Tuesday.
WHAT TO EXPECT\ THE PLAN FOR JUMP-STARTING THE ECONOMY\ \ Income-tax withholding tables will be adjusted at once to give many Americans more take-home pay. Even though that would reduce the size of next year's refunds, Bush said the move would put $25 billion into the economy in the next six months.\ \ The personal exemption for dependent children, now $2,300 per child, would be raised by $500 per child to $2,800. However, the increase would not take effect until Oct. 1.\ \ First-time home buyers would receive a tax credit of up to $5,000 for homes bought this year, with half of the credit applying to 1992 taxes and the other half to 1993 taxes.\ \ Up to $10,000 could be withdrawn from Individual Retirement Accounts without penalty for first-time home purchases.\ \ Families could deduct the interest they pay on student loans.\ \ Capital gains tax, the tax on profits from the sale of stock, real estate and other assets, would be cut from its top rate of 28 percent to a maximum rate of 15.4 percent for assets held at least three years.\ \ Businesses could take an extra 15 percent depreciation allowance to encourage them to invest in more equipment and machinery.\ \ Tax credits and vouchers to help low- and middle-income families buy health insurance, up to a maximum of $3,750 per family. Bush is expected to more fully spell out his health insurance program next month.\ \ All domestic programs excluding benefits programs like Social Security would be frozen at current levels.\ \ U.S. nuclear arsenal would be cut nearly in half if Russia and the other ex- Soviet republics do likewise.