ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Monday, July 29, 1996                  TAG: 9607290096
SECTION: EDITORIAL                PAGE: A-4  EDITION: METRO 

TAX CUTS ONE WAY TO RAISE INCOMES

BEHIND BOB Dole's talk about big tax cuts, an interesting subtext lurks. Across-the-board tax reduction, though fiscally irresponsible from the point of view of public debt and intergenerational equity, does touch on people's concerns about a central feature of the economy: incomes.

Pity the former Senate majority leader. Even for the best of campaigners, which Dole is far from being, it would be tough to go up against a sitting president when:

* Unemployment stands at a six-year low.

* Inflation is running at a modest 3 percent.

* Consumer confidence is up 50 percent from four years ago.

* The federal deficit has been cut in half.

* Ten million new jobs were created.

* The "misery index" - unemployment and inflation rates combined - is down nearly to a 30-year low.

By most measures, the economy works in Clinton's favor. But income levels are more personal and tangible than other statistics. And the growth of incomes hasn't neatly followed the economic expansion since Clinton took office.

On the contrary, the income gap dividing rich and poor has widened, while uncertainty over future income growth has increased.

Dole would do well to talk about incomes, and not merely out of political desperation.

When he was a candidate four years ago, Clinton stressed the need to "invest" in education and training, research and infrastructure, to help bring along those falling behind and to improve prospects for higher incomes in a global economy. Clinton understood that, in an information-based economy, incomes more closely correlate with education and skill levels.

He still understands that. As president, however, he has had to focus more on deficit reduction and less on public investments, in part because of the debt he inherited from the previous Republican administrations.

Now Dole is set to propose another round of Reagan-like tax cuts. They would send debt soaring again, and only a few years before the costs of Baby-Boomer retirement send federal deficits surging again. Tax cuts would do little to advance skills or improve the quality of jobs.

But they would raise net incomes, for a while.

LENGTH: Short :   48 lines