Plan calls for higher
taxes, not ‘raw pain’
WASHINGTON — On the eve of
addressing Congress, President
Clinton tried to smooth the way Tues
day for an economic austerity plan
that would impose higher taxes on
families making more than $30,000
but reserve the biggest blow for Ameri
cans earning $100,000 or above.
“I think that when you see the
whole program, it won’t be raw pain,”
Clinton said. ”1 think most middle
class Americans, when they look at
the costs plus the benefits, they’re
goi o be much, much better off.”
I . stock market tumbled nearly
83 points (Mi fears that higher taxes
would short-circuit an economic re
vival and would not be accompanied
by deep cuts in government spending.
Clinton shrugged off the drop, say
ing, “The people in the stock market
have known in general all among
what was going to be in the program
and the stock market’s gone up mark
edly since the election.”
Senate Republican leader Bob Dole
said the market was reacting to
Clinton’s speech Monday night.
“Dropping like a rock,” Dole said.
“Hold onto your wallets.”
The president will go before a joint
session of Congress with a nationally
televised speech at 9 p.m. Wednesday
to explain details of his $500 billion
plan of tax increases and spending
cuts over four years.
The broadest impact of Clinton’s
tax program would be from a new tax
on energy. Details of the energy tax
were being withheld until Clinton’s
speech, but it is supposed to be based
on the heat content of fuels. "
There also will be an increase in
the top individual and corporate in
come tax rates, and an increase in the
percentage of Social Security ben
efits subject to taxation for couples
earning over $32,000 or individuals
earning more than $25,000.
The plan calls for a $15 billion
investment tax credit, and for $16
billion in shortterm spending for job
intensive projects such as highway
and bridge construction.
White House press secretary Dee
Dee Myers confirmed that the admin
istration is considering another round
of increases to pay for universal health
care.
Reducing the deficit
Clinton plans to cut the federal deficit by raising taxes, cutting discretionary
spending and controlling entitlements such as health care.
Health dare expenses dominate budget pie
■ Health care has become the biggest share of federal spending. It is
expected that Clinton will announce cuts to help control the deficit.
■ Deep cuts in defense spending are expected over the next few years with
$8 billion cut below the Bush administration's plan for 1994.
■ Major budget outlays go toward the national debt which has tyjadrupled
since 1980.
1967 Federal budget
$157.5 billion
r Social Security
1992 Federal budget
$1,361.8 billion Social Security
I $285.1
In biions of dollars
- In More of dollars
U.S. receipts and outlays
’80 ’85 ’90
U.S. federal debt since 1940
Source: U.S. Dept of Labor, Office of Management and Budget; Congressional Budget umce
Auditors find
weaknesses in
bank studies
WASHINGTON—Congres
sional auditors said Tuesday
they have found surprising
weakness in the examinations
of banks and savings institu
tions by federal regulators for
safety and soundness.
Only one of 58 randomly se
lected banks and thrifts was ad
equately examined, the General
Accounting Office said in re
ports prepared for the House
Banking Committee.
“Our review of the examina
tion process shows surprising
weakness in this fundamental
regulatory function, which many
have assumed to be an effective
deterrent to unsafe and unsound
banking,” said Charles A.
Bowsher, the head of theGAO.
The GAO issued four reports
— one each on the Office of the
Comptroller of ihe Currency,
Federal Reserve Board, Federal
Deposit Insurance Corp. and
Office of Thrift Supervision.
U.N. to inspect suspected Iraqi arms sites
BAGHDAD, Iraq — The United
Nations plans to send more weapons
inspectors to Baghdad and conduct
aerial surveys of two sites where it
suspects Saddam
Hussein’s govern
ment designed
nuclear missiles,
U.N. officials said
The decision to
challenge
Saddam’s ban on
flights over;
ougiiudu wui icm uaqi compliance
with u.N. Security Council terms for
ending the Persian Gulf War. If Iraq
refuses to comply, it could lead to
President Clinton’s first showdown
with Saddam.
Tim Trevan, a spokesman for the
U.N. Special Commission overseeing
the destruction of Iraq’s major weap
ons systems, said inspection teams
had not flown over the capital so far
out of respect for Iraqi sensitivities.
But “we have the right to fly over
Baghdad,” Trevan said in New York.
“We will exercise that right when we
nave operational neea to ao so.
Pierce Corden, an American who
is deputy chief of the Special Com
mission, declined toTcomment about
possible flights over Baghdad. But he
said three to four new teams of weap
ons inspectors would be coming to
Baghdad soon.
“Unless there is a dramatic change
in Baghdad’s attitude, Iraq has a long
way to go fulfilling ail the Gulf War
Security Council resolutions,” said
Corden, who was in Baghdad prepar
ing a report on the commission’s
progress.
U.N. inspectors have given the Ira
qis notice they want to fly over two
relatively small sites in Baghdad be
lieved to contain equipment to design
prototypes of nuclear ballistic mis
siles, Trevan said. However, the Ira
qis have not been given flight plans or
a date, he said.
The sites were not inclutfcd in
Baghdad’s disclosure of facilities in
volved in nuclear research, Trevan
said. The inspectors discovered the
sites on their own, and have checked
them on visits by car.
Serb tanks block convoy, maul two areas
SARAJEVO, Bosnia-Herzegovina
—Serb militiamen and tanks bauercd
two areas in western Sarajevo and
^ ■ blocked the main
airport road Tues
day in a major es
calation of fight
ing as residents
tried to conserve
dwindling food
supplies.
On the border
with Yugoslavia,
Bosnian Serbs also blocked a U.N. aid
convoy for a third straight day from
gelling to an area in eastern Bosnia.
The Serbs allowed a second convoy 10
pass through the same checkpoint.
Bosnia’s Muslims have become
increasingly hostile to the U.N. peace
keeping and aid operations because of
the failure to stop the war or get aid to
Muslims trapped by Serb forces.
Sarajevo officials are refusing to
distribute U.N. food in hopes of pres
suring the United Nations. Aid flights
were suspended late last week be
cause U.N. warehouses were filling
up.
The last normal aid delivery from
warehouses was made Thursday, but
* citizens were believed to have saved
up food to last for several days. The
last operating bakery ran out of cook
ing fuel on Monday.
A Bosnian journalist, who spoke
on condition of anonymity, said she
watched people run into a shelled
warehouse Monday and grab food.
Canada announced it is sending
1,200 soldiers serving as U.N. peace
keepers in neighboring Croatia to help
deliver relief supplies in Bosnia. The
troops will begin arriving in a few
days, the announcement said.
Officials of Bosnia’s Muslim-led^
government declared a city wide alert \
in Sarajevo for a second consecutive
day, warning people to stay indoors
because of heavy shelling and sniper
fire.
Bosnian radio said Serbs had
brought in 10 new tanks for a conccn •
trated attack on the Azici and Stup
neighborhoods around the airport.
MU is a very serious situation,” the
broadcast said.
Jury prospects quizzed for King trial
LOS ANGELES — A racially
mixed group of prospective jurors
who all had seen the videotape of
police beating Rodney King said Tues
day they could be fair in the second
trial of four officers despite the poten
tial for riots.
An Asian woman who was one of
the first 12 panelists called into the
federal court jury box said she watched
most of the officers’ earlier trial in
state court on television and disagreed
with that jury’s verdicts of acquittal
on all but one charge.
Those verdicts led to deadly riots
in Los Angeles last spring.
The woman also said she was wor
ried about friends’ reactions if she
r
voted to acquit the white officers in
the 1991 beating of King, a black
motorist. Asked how her friends and
family would treat her if she voted for
acquittal, she said: “I'm sure they
would treat me fairly and understand.”
Asked by Assistant U.S. Attorney
Barry Kowalski how she thought they
would react if she voted to convict,
she said: ‘‘I’m sure they would feel
justice has been done.”
The first jury pool of 73 was three
quarters male and included nine
blacks, about a dozen Hispanics and a
few Asians..
The first 12 potential jurors were
selected randomly from those who
crowded into U.S. District Judge John
Davies’ courtroom. They included two
blacks, an Asian, a Hispanic and eight
whites.
The judge had said he hoped a jury
would be seated by the end of the day
Wednesday. Only four people were
questioned by the prosecution by
lunchtime.
Before questioning began, the
judge acknowledged the notoriety of
the videotape, saying the test of a fair
jury was not whether panelists had
seen the tape, but whether they could
be fair.
“If we disqualified everyone who
had seen a broadcast of that (tape), I
don’t think we’d ever get a jury,”
Davies said.
Nebraskan
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World wire
Babbitt: Land should sell at market value
w AoruiNU i UN— ine Clinton
administration wants a better re
turn on resources froin public lands,
such as mazing and mining opera
tions and park concession contracts.
Interior Secretary Bruce Babbitt
said Tuesday.
President Clinton’s budget di
rector, Leon Paneua, “has been
pretty unrelenting in voicing mai
message,Babbitt said.
“This administration believes
public resources ought to be sold at
market value,” he said in reference
to subsidized grazing and timber
sales and the sale of federal land to
mining interests for as little as $2.50
an acre.
Barbara Bush treated for arm injury
MIAMI — Former first lady
Barbara Bush was treated at a hos
pital Tuesday for an arm injury
shortly after she and former Presi
dent Bush returned from a Carib
bean cruise, a spokesman said.
Mrs. Bush was released from
Jackson Memorial Hospital a few
hours after her arrival, said Bush
spokesman Andrew Mancr. She
appeared in good spirits as she left
the hospital, her left forearm cov
ered by a 4-inch bandage.
“She’s in perfect health,” Maner
said. “She had hurt the arm while
they were still in the White House.
The wound reopened.”
onow buries Plains and Eastern states
n aiuiiii mat aroppea a loot or
more of snow bogged down high
ways and closed schools Tuesday
from the Plains to New England,
and some travelers had to spend the *
night on a church floor.
Many motorists ended up in
ditches or in fender-bender acci
dents. Police in western New York
state blamed one traffic death on
the weather. On Monday, the storm
was blamed for seven trail"c deaths
four in Missouri, two in Okla
homa and one in Kentucky.