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St. Paul, Minn. — The Bush Cabinet members began their day with a stop at Rochester's Mayo Clinic to draw attention to one sector of the economy that has seen job growth in recent years -- health care. The economic team says the president's tax cuts should soon produce similar expansion in other markets.
By noon, the "Jobs and Growth Tour" had moved to St. Paul, where the Cabinet officials met with Twin Cities business leaders. Treasury Secretary Snow told roughly 20 pre-selected audience members that the package of tax reductions means more money for more Americans.
"Those lower marginal tax rates are showing up in somebody's pocket as additional income. And those child credits are showing up in somebody's pockets as additional income," Snow said. "And the effect of the marriage penalty is to put additional money in people's pockets. And the enhanced expensing is creating more free cash flow for business."
The business group appeared unanimous in its support for the tax plan. Several participants noted, in particular, that reductions in the tax on dividend income seemed to have boosted earnings on Wall Street and encouraged new investments in the economy. And a few suggested the tax breaks for small businesses were already spurring job growth.
Sidney Larson is the president and owner of Five Star Food Base Company of St. Paul. The company prepares seasoning, soup stocks, and batter mixes. Larson says the $3 million company is now preparing for a $1.2 million expansion.
"The happy circumstance is ... the tax relief that we're getting is going to allow us to do more than we had planned on doing. And it's going to allow us to grow our company at a better rate than we would have otherwise," says Larson.
But other companies aren't looking at expansions -- they're holding the line or even letting employees go. As of last month, Minnesota alone had lost roughly 60,000 jobs. Last week the state lost at least one more. John Andrew worked for a small software company in Eagan until he was laid off last Thursday. Afterwards, he packed up the minivan and headed to Milwaukee, where the Bush team's "Jobs and Growth Tour" began.
Andrew has been trailing the cabinet secretaries for the past two days. He says the tax cuts are focused on the wealthiest Americans and have done nothing to promote job expansion.
"If you're going to follow a policy of tax cuts -- and I'm not sure I agree with that -- give a disproportionate amount of tax cuts to the middle class and lower classes, people who will actually spend that money and stimulate this economy," says Andrew. "Don't give it away to the wealthy at this point. They are protecting their money."
Andrew says that based on the Bush administration's own statistics, the country has lost another 10,000 jobs since the tour began. But Commerce Secretary Evans says the situation could be much worse, given the obstacles the country has faced since Bush took office.
"We were dealing with a stock market that was collapsing. We were dealing with an economy that was moving into recession," Evans says. "We have dealt with 9/11. We have dealt with corporate scandals. We have dealt with a war in Afghanistan. We've dealt with a war in Iraq."
Evans says the economic conditions are now ripe for a dramatic economic turnabout. Democrats and their labor allies aren't so sure.
The Bush team made a final stop at the Richfield headquarters of Best Buy. Across the street were roughly 75 demonstrators, including DFL state party chair Mike Erlandson. Erlandson says Republicans have had plenty of time to sort out the economic situation. And he says they've little to show for it.
"They keep wanting to blame all their problems on September 11 or the Clinton administration," says Erlandson. "They've been in charge for two and a half years now, their economic plan passed Congress. It's gone into effect, and it has had no positive impact on the economy."
Erlandson says the sour economy will cost Bush support in the 2004 race. That race is already heating up in Minnesota. Bush has announced he'll make a campaign stop here next month.
(MPR reporters Mark Zdechlik and Rob Schmitz contributed to this report)