President Bush warned Tuesday of an economy starting to “sputter” and defended his proposed income tax cut for the highest-earning Americans, telling traders at the Chicago Mercantile Exchange that it would help entrepreneurs – “the backbone of the country.”
Bush said 95 percent of entrepreneurs pay the highest income tax rates and said his proposed cut, which would drop the top rate from 39.6 percent to 33 percent, would free up capital for them.
“When we cut that top rate ..., we’re sending a loud and clear message that the entrepreneurial spirit will be reinvigorated as we head into the 21st century,” Bush told hundreds of cheering traders on the exchange floor. “Small business is the backbone of the country.”
Bush also argued that across-the-board tax cuts for all Americans would help revive the economy. “You all know that as well as anybody does. The great boom is beginning to sputter a little bit.”
Bush received loud applause as he worked his way through a raucous crowd on a commodities floor packed with traders and clerks in their trademark mustard-yellow smocks. The traders reached over each other to shake Bush’s hand, and in the din of buying and selling, Bush had to shout in his well-wishers’ ears to be heard.
As Bush mingled in the “pit” where securities futures were changing hands, the workers stole glances at the trading board.
The visit comes nine years after the president’s father, the first President Bush, toured the exchange and pledged to stave off recession with his own plan.
Bush is trying to shore up congressional support for his 10-year, $1.6 trillion tax cut and for his proposal to keep discretionary government spending from growing more than 4 percent annually. Some Democrats have questioned the proposals.
One moderate Illinois Democrat, Rep. Bill Lipinski, met Bush in Chicago, as did House Speaker Dennis Hastert, a Republican. White House political operatives believe Lipinski is leaning against Bush’s tax and spending proposals.
Lipinski’s spokesman did not immediately return a phone call seeking comment.
The president was flying Sen. Peter Fitzgerald, R-Ill., to Chicago aboard Air Force One, and all three lawmakers were returning on the presidential aircraft. The state’s other senator, Richard Durbin, is a Democrat and was not asked to attend the event in his state, a White House aide said.
But Bush lunched with Chicago Mayor Richard Daley, a dyed-in-the-wool Democrat and brother of Al Gore’s campaign chairman.
“I just got a lesson in Chicago politics,” Bush said. “If you run for president, make sure you get the mayor on your side.” Driven by Democratic leaders, a coalition of labor, blacks and liberals carried Gore to victory in Illinois in the November election.
Bush called Daley one of the nation’s great mayors, and said if Daley thinks Chicago needs help, he can pick up the phone and call the White House “any time.”
The pair discussed tax reform, but neither man talked specifically about whether Daley backed Bush’s income tax cut proposal.
Bush went to the exchange to make the case that all Americans are deeply affected by the state of the economy and that his proposals would lift all boats.
“One of the interesting phenomenons that have happened in the American economy in the last decade or so is this growing investor class — the surge of middle-income Americans who now invest in markets, have mutual funds or have other investments,” White House spokesman Ari Fleischer said on the eve of Bush’s visit.
“It’s another reminder how we all are in this together and that markets often are leading indicators, suggesting which direction the economy will grow or go,” Fleischer said.
Agricultural futures, international currencies and stock indexes are traded on the Chicago Mercantile Exchange, a frantic scene with thousands of traders. In 2000, some 231 million contracts worth more than $155 trillion changed hands at the exchange.
The Chicago trip opens Bush’s latest foray into Middle America as he hunts for support from citizens and moderate Democratic lawmakers.
On Thursday and Friday, he resumes the effort in North Dakota, South Dakota and Louisiana.
Back in Washington, Vice President Dick Cheney was recovering from a surgical procedure to repair a damaged artery. Bush said he did not believe Cheney should cut back on his work load. “This country needs his wisdom and judgment,” Bush said. “He’s the kind of man who listens carefully to his body, and he is not going to put himself in a position where he gets very sick.”