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Back Up Talk on Child Tax

June 22, 2003

What's wrong with this picture? President Bush, who is fresh off raising $3.5 million at a $2,000-a-head hamburger and hot dog dinner at a Washington hotel, is heading to California this week to help meet his goal of $175 million raised between now and the GOP convention, which begins Aug. 30, 2004.

In the meantime, the House of Representatives has just passed a plan to permanently eliminate the estate tax. But although the GOP energetically finds ways to woo the wealthy, it has not been able to remedy the most embarrassing part of Bush's tax plan -- the denial of a child tax credit to 6.5 million low-income working families with 11.9 million children.

Bush himself endorsed extension of the child tax credit Thursday for the first time. But the Republican-controlled House and Senate are at loggerheads. If Bush really wants to leave no child behind, he must act more forcefully to bring the House into line by meeting with House Speaker J. Dennis Hastert (R-Ill.) and other GOP leaders to make it clear he wants fast action.

The Senate approved a credit that would be offset by other taxes so that the deficit isn't increased. But the House seized upon the tax credit issue to stuff in a bunch more goodies for the prosperous. Included are the Senate's credits worth $10 billion to low-income families as well as an additional $72 billion in tax cuts aimed at upper-income families.

Families making $110,000 to $150,000 go from a partial to a full credit under the House plan. A partial credit would be extended to many families making $150,000 to $200,000. By the way, the House bill is more generous to members of Congress, with a salary of $154,700 in 2003, than to low-income families left out of the bill. The House legislation includes nothing to offset the tax cuts.

The Senate is sensibly refusing to go along with more budget-busting tax breaks aimed at the prosperous. But the House, which isn't really interested in restoring the tax credit, isn't looking to compromise. This isn't a partisan Republican-versus-Democrat issue, but Senate-Republican-versus-House-Republican.

The only person who can break this deadlock is Bush. But until he offers more than rhetorical support for the tax credit, it won't be clear that he really wants to.

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