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White House Says Bush Tax Cuts Caused Economic Surge

By Richard W. Stevenson

The New York Times -- COLUMBUS, Ohio

The White House claimed credit on Thursday for the surge in economic growth, saying the tax cuts championed by President Bush had helped the nation overcome recession and the economic effects of the terrorist attacks, two wars and corporate scandals.

The news that the economy had expanded in the third quarter at a 7.2 percent annual rate -- the best performance since 1984 -- gave Bush and his party a compelling piece of evidence to back their assertions that they have put the nation back on the road to prosperity a year before Election Day.

“The tax relief we passed is working,” Bush said to whoops of approval from several hundred workers during a speech at an aluminum processing plant in this state that could be be critical for his re-election bid.

Continuing his strategy of never suggesting he is satisfied with the economy, Bush said the good news was only a starting point for his efforts to bring down unemployment.

“We’re making progress,” the president said earlier at a fund-raiser here for his campaign. “But we will not stop until there are jobs aplenty for those looking for work.”

Continued success, he said, required enactment of the rest of his agenda, including making permanent elements of his tax cuts that will otherwise expire in coming years and passing energy legislation pending in Congress that would promote more domestic oil and gas production.

In a shot at the nine Democratic presidential contenders, all of whom have called for rolling back some or all of his tax cuts, Bush suggested that their approach would derail the recovery just as it is gathering steam.

“Just as the economy is coming around, some over in Washington say now is the time to raise taxes,” Bush said. “I strongly disagree. Tax relief put this nation on the right path, and I intend to keep America on the path to prosperity.”

Faced with the prospect that the strong growth figure would undermine their campaign theme that Bush has the worst economic record of any president since Herbert Hoover, Democrats sought to focus attention on what they said were two of the administration’s greatest political vulnerabilities.

One, they said, is that the upturn in economic activity has not yet translated into new jobs to offset those lost since Bush took office. Depending on what measure is used, the economy has shed between 2.6 million and more than 3 million jobs since January 2001.

The other, Democrats said, is that the surge in growth was the result of an unsustainable tax-cutting binge that mostly benefited the wealthy and drove the budget deficit to levels that will bedevil the nation decades. Persistent large deficits, Democrats said, could undermine the expansion down the road by forcing interest rates higher and limiting the nation’s ability to address long-range problems like the mounting imbalances in Social Security and Medicare.

“We’ve lost more than 3 million jobs, 3 million people have fallen into poverty, the budget deficit and national debt are growing, health care and college tuition costs are escalating,” said Sen. Joseph I. Lieberman of Connecticut, one of the Democratic presidential candidates. “And this president still has no real plan to sustain this growth, translate it into jobs, and rebuild a strong middle class.”