WASHINGTON, Jan. 4 (UPI) -- In what was clearly the opening gun of the 2002 election campaign, Democratic Senate Majority Leader Tom Daschle on Friday charged that President Bush's $1.3 trillion tax cut may sharply limit resources needed to effect homeland security and revive the economy.
"Not only did the tax cut fail to prevent a recession, as its supporters said it would," Daschle said. "It also put us in an unnecessary fiscal bind at the worst possible time."
"The tax cut has taken away our flexibility and left us with only two choices -- both of them bad. We can shortchange critical needs, such as homeland defense, or we can raid the Social Security surplus -- and even run deficits -- to pay for these critical needs."
The address directly charged Bush with fiscal failure, charging that "Sept. 11th and the war aren't the only reasons the surplus is nearly gone. The biggest reason is the tax cut."
Though Daschle lauded Bush's conduct of the war on terrorism, he charged that the loss of the government surplus will leave important homeland security actions -- like port, border and air security -- short-changed.
The Bush administration has said that the president's economic recovery plan was stymied last year by Daschle and Senate Democrats who refused to let the measure come to a vote before the Christmas recess.
The counselor to Bush, Karen Hughes, responding from Austin, Texas, where she was accompanying him on a visit, said, "I'm hoping that this is an acknowledgement by Sen. Daschle that his posture at the end of the year in obstructing some of this important legislation was wrong, and that there is finally an acknowledgement that it's time for action."
Daschle on Friday discounted the Republican charge that the debate is between tax-and-spend Democrats and tax-cutting Republicans.
"The Republican agenda in Washington today is being written by a wing of the Republican party that isn't interested in fiscal discipline. They have one unchanging, unyielding solution, that they offer for every problem: tax cuts that go disproportionately to the most affluent," he said.
Addressing an audience of Democratic faithful and news reporters in an ornate, flag-draped hall of the National Guard Association a few blocks from the Capitol, Daschle called for Republicans to join with Democrats this year to pass an economic stimulus.
"We should move quickly to pass a bill that boosts demand, encourages investments and creates jobs. It should consist of entirely one-year measures that would promote economic activity now- when our economy needs it," Daschle said.
Democrats in the Senate charged last month that Bush's recovery plan rewarded the wealthy with tax cuts while not providing sufficient direct payments like health insurance for people who lost their jobs after Sept. 11.
Friday, Daschle said in addition to other measures, he was proposing a tax credit to businesses that created new jobs and what he called a "robust depreciation bonus" to give companies an incentive to make investments in their operations now. Under his depreciation plan, companies should be allowed a 40 percent bonus depreciation for the first six months and 20 percent for the next months. In effect, companies could depreciate their capital investments at an accelerated rate if they made those investments in the next year.
The address had all the earmarks of a campaign kickoff. Daschle was accompanied on the podium by former Secretary of the Treasury Robert E. Rubin and Clinton White House Chief of Staff Leon Panetta, a veteran of 20 years in Congress. He called them veterans of the budget wars in the 1990s when the Clinton administration succeeded in reducing the budget deficit.
Daschle was clearly trying to effect a pre-emptive strike on Bush. His address comes almost three weeks before Congress returns and before the president had completed his vacation and returned to Washington.
It signaled the growing Democratic concern that Bush's overwhelming support for his conduct of the war on terrorism would be hard to offset in a year with tight Senate and House of Representative elections coming up. The Democrats only hold the Senate by one seat and will need to recapture six seats to gain control of the House.
Daschle called for a range of programs to tighten ports, borders and to provide greater funds for non-proliferation programs.
Veteran of an anthrax attack, Daschle called for major changes in the public health system. "Our public health system is dangerously under-prepared for the possibility of future biological attacks, like the anthrax attack on my office."
He said obsolete labs and underfunding must be corrected.