Greenspan Says Tax Cut Could Be Damaging
New York Times (05/01/03) Vol. 32, No. 4 p.34; Rosenbaum, David E.

Federal Reserve Board Chairman Alan Greenspan, speaking to the House Financial Services Committee, said the economy is ready to grow without more tax incentives and that reducing taxes without reducing spending could damage the economy. Meanwhile, new Treasury Department data indicate that tax revenues have slowed and that the budget deficit will be higher than projected last month. Opponents of President Bush's proposed tax incentives are supported by the news, but the president apparently still wants the tax incentives, and White House spokesman Ari Fleischer says the president wants to create jobs and the government could reduce the deficit over time. Greenspan said he thinks there is enough economic stimuli, what with the 2001 tax incentives and an increase in government spending, but added that he supports the president's tax policy so long as the dividend tax incentives are matched by spending reductions.

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