Although it contains various corporate incentives for expanding worker pensions, R&D, education, and use of energy-efficient equipment, the fiscal 1999 federal budget proposal that President Clinton unveiled this week has drawn negative reaction from two leading business groups. The U.S. Chamber of Commerce, calculating that the budget calls for increases in 39 business taxes, is particularly critical of a proposed change in the tax treatment of foreign operations of U.S. multinational companies that it says would boost the tax bill of American exporters by $6.5 billion. The National Assn. of Manufacturers (NAM), meanwhile, fears that the budget "jeopardizes the balanced-budget agreement and threatens to revive big government." Says Vice President Paul Huard: "By slapping business with a higher tax bill, President Clinton shows he has lost sight of what should be our nations top goal: sustained economic growth."
Other reaction comes from the nonpartisan Committee for a Responsible Federal Budget. "The Presidents budget policies are half right," says the Washington-based group. "While the budget offsets $105 billion of the new initiatives with new revenues, we fear [it] will kick off a full-scale bidding war on how to spend the surpluses. Congress will propose their own set of priorities, but could balk at raising new revenues. This could almost make you nostalgic for good old-fashioned gridlock."
