DEMOCRATIC RESPONSE:
Democrats fault Bush for economic policies

Posted: 12:08 a.m., Wednesday

By ELLYN FERGUSON
Gannett News Service

WASHINGTON — President Bush's ``upside-down'' economic policies are forcing states to cut vital services and, in some cases, raise taxes, Washington state Gov. Gary Locke said in the Demo-cratic response to the State of the Union address.

While Bush spent much of his speech reinforcing the administration's case for U.S. action - alone or with allies - in using military force to disarm Iraq, Locke cautioned that to be strong abroad, America must be strong at home.

"Today, the economy is limping along,'' said Locke, whose own state had the third highest unemployment rate last month. "There's no recovery for working Americans and for those searching for jobs to feed and clothe their families."

Locke criticized the administration for last year's $1.35 trillion tax cut package and called the president's latest proposed economic stimulus - a 10-year, $674 billion package whose cornerstone is ending taxes on stock dividends - more of the same.

``We believe it's upside-down economics,'' Locke said. ``It will create huge, permanent deficits that will raise interest rates, stifle growth, hinder home ownership and cut off the avenues of opportunity that have let so many work themselves up from poverty.''

The Washington governor's unvarnished critique of what he and other Democrats consider to be Bush's flawed domestic policy signaled a break with last year. In 2002, Democrats were muted in their opposition to Bush, who had become a popular wartime president after the Sept. 11, 2001, ter-rorist attacks.

While expressing support for Bush's actions so far regarding Iraq, Locke stressed that the United States needs the support of its allies.

"We must convince the world that Saddam Hussein is not America's problem alone - he's the world's problem,'' Locke said.

Locke, chairman of the Democratic Governors' Association, also touched on homeland security, education and the environment in his nine-minute speech, but his focus was the economy.

"States and cities now face our worst budget crises since World War II. We're being forced to cut vital services from police to fire to health care - and many are being forced to raise taxes. We need a White House that understands the challenges our communities and people are facing across America," Locke said.

Hawaii Gov. Linda Lingle, speaking for the Republican Governors' Association, said Locke and other complaining governors were blaming the Bush administration for tough budget times they brought on themselves.

"He seemed to stress that his state and other states are facing crisis times, but they are not looking at themselves,'' Lingle said. ``They spent more than they should have during the good times.''

Democrats want tax cuts directed at the middle class, aid to states and cities, incentives to busi-nesses to spur investment and extended unemployment benefits for 1 million people who exhausted their benefits before the end of 2002.

Locke also called on Bush to provide states and cities with federal aid to cover the cost of home-land security. This has been a bipartisan complaint among elected officials juggling budget deficits and the costs of increased security after Sept. 11.

He also criticized Bush for failing to provide the money for states to follow through on the No Child Left Behind law that requires more student testing.

Locke, the American-born son of Chinese immigrants, recalled that his non-English-speaking grandfather worked as a servant to support a family that produced a Yale-educated grandson who became the nation's first Chinese-American governor in 1996.

"There are millions of families like mine. … They transformed adversity into opportunity. The les-son of our legacy is, if we work together and make the right choices, we will become a stronger, more united and more prosperous nation," Locke said.

Congressional Democratic leaders decided to have a Democratic governor give the party response after Democrats lost control of the Senate and failed to recapture the House in November elections. Democrats gained three governorships in November, the party's only success story.