Masonry Magazine February 1989 Page. 37
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GEORGE BUSH FACES A FULL, TOUGH AGENDA IN HIS FIRST DAYS in office. He must push for his own programs while respecting Ronald Reagan's legacy. And he must contend with a strengthened Democratic majority in the Congress. It is a much more difficult political outlook than Reagan faced during 1981. The incoming President did not set a clear course of action in his campaign. And he did not ask the electorate to endorse specific policies or programs. The division of power with Congress portends protracted struggle on issues.
This doesn't suggest that Bush and Congress won't find some common ground. The approach the new President will take in 1989-the olive branch or sword-will be critical in setting the tenor of his relationship with Capitol Hill. Like most new presidents, Bush will have a honeymoon period. But it's likely to be very short, given the lack of a clear mandate. The problems are large and likely solutions controversial.
THE LAST CONGRESS HAD MORE SUCCESS in voting key bills than expected, although it put off numerous, inevitable hard choices on many vital issues. It dealt with no crisis and passed few laws destined for the history books. Yet in terms of production, it ranks with many of the past in achievement.
It passed a new law mandating redirection of trade policy in the U.S., rewrote the basic welfare law, okayed catastrophic coverage under Medicare, and ratified the most sweeping U.S.-Soviet arms agreement in recent decades. It also strengthened two civil-rights statutes and Federal ethics rules; expanded programs for the homeless, drug addiction and AIDS victims; improved environment programs; and required notice of most plant closings. And all appropriations bills passed on time.
GEORGE BUSH MAY DEAL DIFFERENTLY WITH CONGRESS than his predecessor. He will avoid knock-down fights because he has less clout with the public. What's more, Bush is a creature of Congress, having served on Capitol Hill. He understands its inner workings, including the great need to compromise. This doesn't mean that you won't see some confrontation in the years ahead. Clearly, Bush's campaign rubbed Democratic nerves raw with its sharp tone. Also, the Democratic majority will put forward its own legislative agenda.
But cooperation and conciliation may be greater than many now expect. The problems are serious and need bipartisan effort.
FINDING ANSWERS TO CURRENT ECONOMIC DIFFICULTIES WILL TAKE priority. President Bush has pledged quick action to reduce the large budget deficit. He knows that, absent progress, America faces financial woes and recession. Unfortunately, Bush has painted himself into a corner on deficit-cutting-by continually promising during the campaign to oppose any tax increases. And Bush has pledged to increase spending for education and the environment. What's more, Bush still backs a reduction in the Federal capital-gains tax.
Some experts doubt deficits really matter. But most deem them harmful. Growth in the deficit and the associated explosion of Federal borrowing, absorbs much of the savings necessary to finance investment. This means higher interest rates, which weaken economic growth and threaten American living standards.
IT WON'T BE EASY FOR PRESIDENT BUSH TO CUT the Federal budget deficit. The red ink needs to be slashed $30 billion a year over the next four years. That will require cuts in every area-defense, entitlements, other programs. And most analysts believe that spending cuts alone cannot solve the problem.
In the end, President Bush may have to agree to some form of tax increase. Some experts believe that excise taxes on gas, alcohol and cigarettes might well be increased during 1989.
THE TRADE DEFICIT PRESENTS ANOTHER VEXING PROBLEM for President Bush. Despite the 20% narrowing in 1988 to about $135 billion from $179 billion-the deficit won't easily be reduced much more this year, trade experts say. Several key industries such as paper and chemicals-can't export much more, last summer's drought is expected to curb export of agricultural products, and the U.S. continues to need more imported oil-probably at higher prices. Central to the equation are Bush's policies on the value of the U.S. dollar. A lower dollar would help reduce the foreign-trade gap over the near term. But a depreciated currency stirs inflation fears from higher import prices.
Narrowing the budget deficit offers one way out for the new President. It would free up more funds for domestic use and slow down domestic demand. This, in turn, would cut buying of foreign-made products in the U.S. Without fiscal policy to curb consumption, the dollar would have to fall further.
THE DEFENSE BUDGET WILL COME UNDER INTENSE STUDY by President Bush. It offers a really tempting target for needed cuts in the over-all budget, though reductions must be balanced by the requirements of national defense. Reagan's fiscal 1990 budget adds 2%, plus inflation, for military spending. But few experts expect that Congress will approve growth beyond inflation.
President Bush may go even further in paring the enormous defense budget. He may decide to cancel weapons programs and make some reductions in forces. The goal would be to lap off $300 billion from military spending through 1994.