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Politico Media Enterprises

Dems Say Bush Leaves Too Many Hispanics Behind, Hispanic Republicans Disagree

By James E. Garcia

March 16, 2001
Copyright © 2001Politico Media Enterprises. All Rights Reserved.

A coalition of Hispanic and Black Congressional Democrats say President Bush's budget and tax cut proposals "leave too many behind."

"There is a deep sense of concern which translates to a deep sense of frustration" with Bush's budget plan, said Rep. Silvestre Reyes, D-Texas, the chair of the Congressional Hispanic Caucus. "The numbers don't add up." 

Hispanic and Black caucus leaders were joined at a Thursday news conference by Rep. Dick Gephardt, the House Democratic leader from Missouri. Gephardt said Bush pledged to "unite our country and leave no child behind," but the budget does not do that. 

But Bush's plans also have Hispanic support, including the backing of the increasingly influential U.S. Hispanic Chamber of Commerce.

As the Republican-led Congress ponders its next move on the Bush proposals, Hispanic and Black Democrats in Congress held a joint press conference Thursday to declare that the Bush's "Blueprint for New Beginnings" short-changes most Hispanics and African-Americans.

In a lengthy report titled "The Impact of the Bush Budget on Black and Hispanic Families: Leaving Too Many Behind," the multiracial coalition asserts that Bush's budget "does not invest enough in education, health care, law enforcement" and programs that bridge the "digital divide"- the growing disparity between minorities and whites with respect to computer and Internet access. 

President Bush has proposed $1.6 trillion in tax cuts over the next 10 years, including reductions for people in all income brackets. Most Democrats and some Republicans have criticized the Bush plan as too much too fast, and tilted in favor of the rich. 

Economists estimate that more than $5 trillion in surplus tax revenue will be collected over the next decade, though most add that an economic downturn or other unforeseen events could reduce that figure dramatically.

Bush says Americans are simply overtaxed and deserve a break. He also insists that tax reductions will spur economic growth. Gephardt recently told PoliticoMagazine.com that he prefers a $900 billion tax cut over the next decade because that would provide taxpayer relief and still leave enough money to protect and expand important government programs. 

While most Hispanic leaders agree with Gephardt's assessment, George Herrera, president of the U.S. Hispanic Chamber of Commerce, thinks Bush's plan is good for small businesses and therefore good for Hispanics in general. 

"President Bush is providing the impetus to develop and expand Hispanic small business. His plan is sensible, fair and greatly reduces the inequities that currently exist within the current tax code," Herrera said. The USHCC is the largest and most powerful Hispanic business association in the nation.

Herrera's views were seconded by the head of the Hispanic Business Roundtable, a smaller and pointedly more conservative pro-business group.

"The President's tax relief plan will inject the much needed capital we need to turn around our slowing economy and help Hispanic families everywhere," said HBR President Mario Rodriguez, who agrees with Bush's claim that a tax cut will stimulate the sluggish economy. 

Remedios Diaz-Oliver, a member of the HBR board of directors, added that many Hispanic families would benefit from proposals to double the "child tax credit"  to $1,000 and eliminate the "marriage penalty tax."

But in their report, Congressional  Democrats assert that "most black and Hispanic Americans with children would get no tax cut at all," under the Bush plan, "while much needed improvements in better education, health care, Social Security and Medicare important to minorities are sacrificed" to help Bush meet his tax cut goals.

The report further claims that Bush's tax cuts will actually end up costing more than $2 trillion over the next 10 years. And even though Bush insists everyone will get relief under his proposal, "The reality is that the tax cut will benefit the wealthy while leaving a majority of black and Hispanic families with children behind," the Democrat's report found. Specifically, 45 percent of the Bush tax cuts will go to wealthy families in the top 1 percent of income.

Defenders of the Bush plan say the rich get the biggest benefit because they pay more in taxes. They also say that wealthy investors will use that money to  spur additional economic investment and grow the economy.

The Democrats' report, meanwhile, points to research by Washington-based Center on Budget and Policy Priorities that shows that 53 percent of African American and Latino families with children would receive "no tax reduction if the Bush plan were enacted, even though 75 percent of these families include someone who is working." The report prepared by Hispanic Congressional Democrats found that about 6 million Black and Hispanic families, including 12 million children,  would receive no benefit from the Bush proposal.

Many Black and Hispanic families will receive no tax gain under the Bush plan because they do not earn enough to owe federal income tax -- although they do pay substantial amounts of payroll and other taxes. "Millions of black and Hispanic families fall into this category," the Democratic report states.

While that's true, HBR Executive Director Robert Deposada said in a press statement that critics of the Bush plan "ignore the fact that a vast majority of [Hispanic] small business owners pay personal income taxes on the money they earn in their businesses. And by reducing the personal income tax rates, Bush's plan will be a great boost for these small business owners." 

Virginia Gov. Jim Gilmore, chairman of the Republican National Committee, adds, "The President's budget proposal helps Americans from all walks of life."

Education

President Bush has said education is a top priority for his administration. In his budget, he proposes $44.5 billion in spending for the federal education programs, a 6 percent increase over this year's budget, though it's  the smallest percentage increase in five years.

The Democratic report says that of the $2.4 billion increase Bush has proposed in education, about $2 billion will be spent on literacy programs and college Pell grants. The other $400 million will go to increase funding for all other federal school programs. That increase, the report claims, will not cover the costs of inflation -- meaning funding for many programs may have to be cut.

Hispanic Congressional Democrats add that bilingual education programs alone need a $509 million increase to meet the needs of so called limited English proficient students. Migrant education programs, they say, need a $480 million increase. A national movement to end bilingual education in public schools has gained ground in recent years, but Bush has said he generally supports such programs and opposes "English Only" efforts.

Experts estimate that the number of Hispanic children in public schools nationwide will grow by 60 percent to nearly 13 million students by 2020. In states like California, Texas and Florida, school district officials say Hispanic student population is exploding.

As for higher education, the Bush budget proposal  does not provide enough funding for colleges and universities with large minority populations. Bush provides 6.5 percent more for Hispanic Serving Institutions and Historically Black Colleges and Universities combined, compared to 24.5 percent average annual increase over the last three years under President Clinton.

"The Bush budget, when it comes to education for minority students," the report concludes, "seems to leave many behind."

Representative Illeana Ros-Lehtinen, one of only three Hispanic Republicans in Congress, staunchly defends  Bush and his education plan.

"I applaud the President's commitment to education and his program's emphasis on reading and math skills," she said. "Nothing is more important to parents who work two and three jobs to provide for their children's future than the quality of education their kids receive."

Social Security

The report released by Hispanic and Black Congressional Democrats repeats another criticism of the Bush plan: In order to pay for tax cut, Bush may  have to  dip into the Social Security and Medicare trust funds.

During his presidential campaign, Bush said, "we need to take a trillion dollars out of that $2.4 trillion [Social Security] surplus [to set up individual accounts]." The President has proposed encouraging younger workers to invest some of the money they pay into Social Security elsewhere to pay for retirement.

Democrats, however, say this could endanger Social Security and imperil Hispanic seniors, who tend to have less private pension money to depend on in retirement. Social Security is the only source of retirement income for 39 percent of elderly Hispanics and 40 percent of Blacks. And about 80 percent Hispanics retirees receive a majority of their income from Social Security.

Medicare

The federal government's primary health care program for the elderly, Medicare, is also threatened by the Bush tax cut proposal, say Democrats. Although Bush's Secretary of Health and Human Services, Tommy Thompson, said Bush will not use revenue dedicated to Medicare for any other purpose.

But the report by Hispanic Democrats says Bush tentatively designates about $526 billion of the Medicare surplus to a "$1 trillion contingency" fund -- meaning it could be used for tax cuts and programs other than Medicare. And the money Bush has pledged to help pay for prescription drug benefits for the elderly, $153 billion, is not nearly enough, they say.

"Medicare and prescription drug coverage is important to Black and Hispanic seniors," the Democrats' report stated. "More than 4.5 million Black and Hispanic seniors get their health care through the Medicare program, and that number will balloon over the next 25 years."

Today, 1 of 4 Hispanics elderly Hispanic seniors depend on Medicare as their only source of health insurance, as compared to 1 of 10 non-Hispanic whites. And experts predict the percentage of elderly minorities, as compared to the overall population, will more than double in the next 25 years.

Indigent Health Care

Bush has pledged to increase in funding for the National Institutes of Health and to expand the number of community health centers -- which serve a predominantly minority clientele. 

But Hispanic Democrats say the Bush budget plan does little to expand Medicaid, the government's medical coverage for the poor. And they say other programs aimed at minorities will suffer, including programs for low-income children and AIDS prevention and treatment grants. The rate of AIDS infection is higher among Blacks and Hispanics than whites.

Nearly 35 percent of Hispanics nationwide do not have health insurance.

Justice and Civil Rights

The Bush plan will freeze the Justice Department budget, which liberal advocacy groups say could curb civil rights enforcement, legal aide services for minorities and even law enforcement in Black and Hispanic communities.

"While Bush has said he stands for providing equal opportunity to all, his budget does not put money into enforcing the civil rights laws of our land," the Congressional Hispanic report claims. 

Critics contend that Bush will roll back federal efforts to promote and protect civil rights. Bush recently ordered Attorney General John Aschroft, the nation's chief law enforcement official, to develop a plan to address "racial profiling" nationwide. While most Black and Hispanic leaders forcefully opposed his nomination, Ashcroft, a former U.S. senator, has pledged to vigorously enforce civil rights legislation.

Hispanic Democrats and Latino civil rights groups also worry that the Legal Services Corporation, which provides legal assistance to low-income Blacks and Hispanics will suffer major budget cuts under Bush. They say the program helps millions of low-income Americans, especially minorities, in need of legal assistance. About two-thirds of those eligible for legal aide are Hispanic and Black. The proposed cuts come even as the agency claims to have enough funding today to serve about 20 percent of eligible clients.

Digital Divide

Bush also has proposed to cut federal funding used to deliver Internet access and computers to poor and rural communities. Research shows the "digital divide"  between Hispanic households and the overall population grew 4.3 percent last year. About 46 percent of white households are connected to the Internet as compared to 23 percent of Hispanic households. 

Small Business

To meet his tax cut goals, Bush also will reduce funding to the Small Business Administration. To cover the cuts, fees would be increased for some programs. 

Nonetheless, Rodriguez of the Hispanic Business Roundtable, said, "Critics of (Bush's) plan ignore the fact that a vast majority of small business owners pay personal income taxes on the money they earn in their businesses. And by reducing the personal income tax rates, Bush's plan will be a great boost for these small business owners." 

Public Housing

Bush's Secretary of Housing and Urban Development, Mel Martinez, has said he will work hard to increase home ownership. But the Bush Administration cuts $859 million from the federal public housing programs. 

Most of the housing cuts will come from money targeted for the repair and maintenance of public housing units. Additionally, Bush wants to cut money for programs designed to rid public housing of illegal drugs by promoting drug treatment and security efforts to reduce drug related crime. 

In the end, according to Marisa Demeo of the Mexican American Legal Defense and Educational Fund, "If Bush's current tax plan is implemented, Latinos will suffer."

Rep. Henry Bonilla, a key Republican advisor to Bush on Hispanic affairs, said, "The President's plan will directly help the millions of Hispanic Americans who are working for their family's future....I really wish Democrats would put aside politics and help us make this tax cut a reality."

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