Clinton Again Threatens Veto of Marriage Penalty Bill

President Clinton announced Saturday that he will veto the Republican bill to cut taxes for millions of married couples, denouncing it as “one part of a costly, poorly targeted and regressive tax plan.”

While not unexpected, the president’s vociferous rejection of the so-called marriage penalty repeal sets the stage for an election-year battle over spending priorities just as the political parties are gearing up for their nominating conventions and the homestretch of Campaign 2000.

Clinton sounded the same theme Saturday in his weekly radio address, which was taped here in Okinawa, where he is attending the annual summit of the world’s leading economic powers.

In it, the president accused congressional Republicans of “treating this [budget] surplus as if they’d won it in the lottery.”

Clinton said he supports “targeted” marriage penalty relief but cannot go along with the GOP version, which he said would “risk our fiscal discipline and continued prosperity.”

Although Clinton has played a restrained role in the current presidential campaign, his message dovetails with a central tenet of Vice President Al Gore’s bid for the White House.

Gore has been trying to portray his presumed GOP opponent, Texas Gov. George W. Bush, as a spendthrift whose tax-cut proposals and Medicare reform agenda would put the nation’s prosperity at risk.

In their radio response, the Republicans argued Saturday that there is sufficient money in the surplus for their tax-relief agenda.

Speaking for the GOP, Sen. Rod Grams of Minnesota said there is plenty of room in the non-Social Security surplus--$2.17 trillion over 10 years, including Medicare--to justify the larger tax cuts.

“Taxpayers fund every agency, program, project and bureaucrat, yet somehow they’re the most used, abused and underappreciated people in America,” Grams said. “The Republican Congress believes that Americans already spend too much of their money paying taxes.”

Clinton claimed that the tax cuts enacted during this session of Congress would “completely erase” the projected surplus within 10 years.

The White House on Saturday released an analysis estimating the 10-year cost of major tax cuts passed or moving forward in the GOP-led Congress at $712 billion. That estimate includes the repeal of the inheritance tax--passed recently by bipartisan majorities in both houses--which Clinton also has vowed to veto.

The White House analysis also said that, because the public debt would be paid back at a slower pace under the GOP agenda, higher interest costs would raise the overall price tag of the Republican tax cuts to $913 billion over a decade.

“In good conscience, I cannot sign one expensive tax break after another without any coherent strategy for safeguarding our financial future,” Clinton said in his radio address.

“At this rate, there will be no resources left for extending the life of Social Security or Medicare, a real Medicare prescription drug benefit, investing in education, much less getting us out of debt. . . . “

Clinton said the GOP tax cuts will provide more relief to the wealthiest 1% of taxpayers than the bottom 80% of taxpayers.

In contrast, the president said, his proposed $263-billion, 10-year tax cut, which includes marriage penalty relief, targets two-thirds of the cuts to the middle 60% of Americans.

Grams disputed Clinton’s claim that the tax cuts are skewed to the wealthy, calling his assertions “just plain rhetoric, not reality.”

He urged the president to reconsider his veto intention.

“Mr. Clinton, we’re asking you to put aside election-year politics and help families live the American dream,” Grams said. “If you do your part and sign the bills we have sent you . . . Americans can keep a little more of their hard-earned money.”

The GOP marriage penalty repeal would reduce federal revenues by $90 billion over five years. Democrats contend that the cost to the federal treasury over 10 years would be about $293 billion.

The marriage penalty causes about 25 million couples--about half of joint filers--to pay higher income taxes than if they filed as a pair of single taxpayers.

At the same time, an estimated 21 million couples received a “marriage bonus” last year, paying less in taxes by filing jointly than if they had filed as single taxpayers, according to the Treasury Department. This usually occurs when one spouse earns all or most of the couple’s income.

Clinton has said he would accept the GOP bill cutting taxes for couples if congressional Republicans send him an administration-backed plan providing a prescription drug plan under Medicare. So far GOP leaders have refused to do so.