Bush signs tax cut extensions into law

Democrats opposed the legislation, saying cuts benefit the rich.
WASHINGTON (AP) -- President Bush signed a $70 billion tax-cut bill Wednesday that Republicans hope will help them with voters as they head into the fall elections with worries about retaining control of Congress.
"With this bill, we're sending the American people a clear message about our policy," Bush said. "We're going to continue to trust the American people with their own money."
Democrats overwhelmingly opposed the legislation, saying the tax cuts on capital gains and dividends will flow mostly to the rich.
"Today's really a good day to be a millionaire, but it's a bad day if you want to be a millionaire," said Senate Minority Leader Harry Reid of Nevada "That's because President Bush just signed, with the stroke of a pen, a bill that sealed the fate of those trying to get ahead."
5.2 million jobs
The GOP says the tax cuts, first enacted in 2003, have created 5.2 million jobs since August 2003 and bolstered tax revenue by nearly 15 percent last year. According to the White House, the cuts have helped spur growth by keeping $880 billion in taxpayers' pockets during the past five years.
"Our pro-growth policies stand in stark contrast to those in Washington who believe you grow your economy by raising taxes and centralizing power," said Bush, joined at the signing ceremony by Vice President Dick Cheney.
The bill passed the Senate last Thursday by a 54-44 vote.
The legislation provides a two-year extension of the reduced 15 percent tax rate for capital gains and dividends; it was to expire at the end of 2008.
Since 2003 when the cuts were passed, business investment has been growing at more than 9 percent a year and spending on equipment and software has hit record levels, Bush said.
The measure also extends for one year recent changes to the alternative minimum tax to prevent that tax from ensnaring more upper middle-income families. The tax was designed to hit the very wealthy. Now, however, it is common for taxpayers, especially those with families in high-tax states, to pay the AMT on incomes of $100,000 and more.
Bush also renewed his threat to veto legislation to pay for war in Iraq and hurricane relief at home because the spending bill has so many election-year add-ons. He has set a limit of $92.2 billion for the war and hurricane relief plus an additional $2.3 billion to prepare for a possible bird flu pandemic.
Homeland help
Elsewhere, a House panel gave a tongue-lashing to the Department of Homeland Security before approving a $32.1 billion spending plan for the troubled agency.
The Appropriations Committee approved by voice vote the agency's budget for the fiscal year beginning Oct. 1 after quarreling over -- and defeating -- Democratic proposals to boost funding for port and border security and grants to emergency first-responders.
The GOP-drafted budget bill for the department would devote $19.6 billion to various border security and immigration enforcement programs, a 9 percent increase over current funding.
The bill effectively boosts the department's budget by 6 percent over current levels, but still registers about $200 million less than Bush sought, since the Appropriations panel rejected for the second year in a row a Bush administration plan to raise airline ticket taxes. The fees were to finance about $1.3 billion in additional spending by the agency.
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