Panel offers tax plans

Panel offers tax plans
WASHINGTON -- President Bush's tax reform panel settled Tuesday on two approaches to simplifying the federal tax code, one that would preserve the income tax but scale back its tax breaks and one that would exclude investment income from taxation. Both approaches would do away with the alternative minimum tax, which was aimed at wealthy taxpayers but is forcing increasing numbers of the upper middle class to pay more April 15. Both would also limit the mortgage interest deduction and eliminate the deduction for payments of state and local income and property taxes. Some panel members expressed concern that both plans would make the system less progressive by shifting more of the tax burden from the wealthy to the less well-heeled.
China raises suspicion
BEIJING -- China is raising global suspicion about its military intentions by failing to acknowledge the true size of recent increases in its defense spending, Defense Secretary Donald H. Rumsfeld said. On his first trip to China as President Bush's Pentagon chief, Rumsfeld is meeting with government officials and senior military leaders in advance of Bush's planned visit next month. A Chinese spokesman said he hoped Rumsfeld's visit "would increase his understanding" of China's policy. In his first scheduled event of the three-day trip -- a speech at a top Communist Party top training center -- Rumsfeld lectured China on the lessons of democracy.
Gorbachev guru dies
MOSCOW -- Alexander N. Yakovlev, a strong advocate of democracy and human rights who crafted many of the perestroika policies instituted by former Soviet President Mikhail S. Gorbachev, died Tuesday. He was 81. Hard-liners blamed Yakovlev, the philosopher-ideologist of Gorbachev's reforms, for the Soviet Union's 1991 disintegration and for the defeat of Marxism-Leninism in its global struggle with capitalism. During the 1990s, he worked to awaken the Russian people to the crimes of Soviet dictator Josef Stalin, and in recent years he accused Russian President Vladimir V. Putin of rolling back democratic reforms in a drift toward political authoritarianism.
Combined dispatches
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