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The best example yet of the differences in style between the current and previous presidents happened last week on the tax cut. While Bill Clinton would have called the House and Senate leadership to the White House for negotiations, George W. Bush let it be known that he had not yet begun to fight.

Even though Congress approved a budget resolution the week before that appeared to cut the president's proposed tax cut from $726 billion to $350 billion, the White House is refusing to admit that the fight is over. Instead, the administration began a nationwide blitz that it hopes will make it impossible for the Senate to keep to the lower tax cut a majority of senators said they wanted. Although the president himself said he would accept the $550 billion tax cut the House says it is ready to approve, there were some indications that he has not completely given up on his original proposal.

There is little doubt about the intense pressure the White House will bring in the next few weeks. Events in 30 states are planned to increase public support for as large a tax cut as possible. At least one pro-tax-cut organization is running attack ads in the home states of the two Republican senators - Olympia Snowe of Maine and George Voinovich of Ohio - who are most closely blamed by the White House for the smaller tax cut. Senate Majority Leader Bill Frist, R-Tenn., supposedly is being targeted by key administration officials to ignore the pledge made by Senate Finance Committee Chairman Charles Grassley, R-Iowa, to keep the tax cut at $350 billion.

There was even some indication that the White House wanted to replace Senate Parliamentarian Alan Frumin with someone who is more likely to issue a ruling on the reconciliation bill that will make it easier for a tax cut larger than $350 billion to be considered. This is ironic. Frumin himself was hand-picked two years ago to replace the previous parliamentarian, whose rulings - regardless of whether they were right - made tax cuts too difficult.

Part of the reason the White House is taking this aggressive stance is that it does not like to negotiate with Congress. As one top business budget and tax lobbyist told me late last week, negotiating is just not Bush's style.

The fact that the administration's problems are being caused by Republicans, who control both the House and Senate, does not appear to make much of a difference to this White House - nor does the likelihood that challenging the budget resolution may hurt the Republican Party. Indeed, the fact that the problems are Republican-made only appears to have further incensed Bush, who is known for insisting on absolute loyalty from his own people.

Another reason the president is pursuing this aggressive plan is the very real possibility that political momentum on the tax cut is moving away from the White House. The end of most of the daily military activities in Iraq will focus renewed attention on the economy, an issue where the president's approval ratings are relatively low. At the same time, the costs of domestic stabilization activities in Iraq are expected to continue to rise and have an increasingly obvious impact on the deficit - highlighting the issue that pushed the Senate to slash the size of the tax cut in the first place.

There is also little indication that the economy will pick up as projected - and a soft or nonexistent recovery will increase the deficit even further. It won't be too long before fiscal 2003 and 2004 deficits of close to $500 billion start to be discussed, and that could push even more members of Congress to call for smaller (or even no) tax cuts.

All of which raises another possible administration strategy: Even if the blitz does not increase the size of the tax cut, it may be needed to prevent further reductions.

Election considerations are also playing a big role in the White House's decision not to give up on the tax cut ship quite yet. By continuing to push for as large a tax cut as possible, the president is clearly playing directly to his base of supporters. This is the group that votes in primaries and contributes significantly to political campaigns. It is also the group that stayed home in 1996 rather than vote for Republicans they thought were too willing to compromise with Clinton.

The implications of the White House tax-cut strategy on the rest of the budget process are enormous. No decision on tax cuts will be final until Congress adjourns for the year; the president will take what he can get at each step and keep pushing for more. There has been some serious discussion, for example, about doing two tax cuts, one in reconciliation and a separate standalone bill later in the year. This could mean that all other budget activities - including the fiscal 2004 appropriations - will take a back seat to tax cuts, and that few, or perhaps none, will be enacted by the start of the fiscal year.

In the meantime, however, the USS Tax Cut looks like it will be sailing on. At least for now, no one at the White House is ordering anyone to "abandon ship."

Question Of The Week

Last Week's Question. A few people got this one wrong, but almost everyone said that the reconciliation instructions to the Senate Finance Committee require it to report its version of the tax bill by May 8, 2003. Clare Kelly, who serves as the associate director for public policy at the National Association of Children's Hospitals in Alexandria, Va., wins this week's "I Won A 2003 Budget Battle" mouse pad. Clare was selected at random from everyone who submitted the correct response.

This Week's Question. Two of these incredibly attractive red, silver and white "I Won A 2003 Budget Battle" mouse pads will be awarded this week. The first will go to the person who correctly answers this question: "According to federal budget process rules, what is the penalty if the Senate Finance Committee is unable or unwilling to report a reconciliation bill by the May 8 deadline?"

The second mouse pad will go to the person who comes up with the best answer to this question: "What should the penalty be if the Senate Finance Committee is unable or unwilling to report a reconciliation bill by the May 8 deadline?"

Send your response to scollender@nationaljournal.com by 5 p.m. PDT on Saturday, April 26, 2003. You must include your mailing address so the "I Won A 2003 Budget Battle" mouse pad can be sent if you win. If there is more than one correct response, the winner will be selected at random from those with similar answers.

(Note to government employees: Because of security procedures at most departments and agencies, a home rather than office address will be the best way to get the mouse pad to you.)

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