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Bush defends tax cuts

Polls show economy is top concern

President Bush:
President Bush: "We did the right thing with tax relief."

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RICHFIELD, Ohio (CNN) -- Visiting a state that could be key to his re-election prospects, President Bush on Monday offered a spirited Labor Day defense of his tax cuts, saying they've helped to spur the economy and have prevented a deeper recession.

"We did the right thing with tax relief," Bush told an enthusiastic union audience, which braved rain to hear the president.

With the 2004 presidential election on the horizon, Democrats have stepped up their criticism of Bush's stewardship of the economy. Recent public opinion polls have placed the issue at the top of Americans' priorities, above terrorism. The unemployment rate of 6.2 percent is the highest in nine years.

Bush, however, ran through a litany of factors that he said contributed to a lackluster economy: the terrorist attacks of September 11, 2001, corporate malfeasance, and a stock market in decline before he came into office.

The president said his series of tax cuts -- passed in 2001 and 2003 -- has provided a needed tonic to the economy -- despite a rising federal deficit. The Congressional Budget Office recently estimated that next year's deficit will approach $500 billion. The tax cuts included reductions in capital gains and dividends, as well as expanded child tax credits and larger write-offs for businesses that invest in equipment.

"Things are getting better," Bush told the International Union of Operating Engineers. "But there's some things we've got to do to make sure the economy continues to grow."

Bush cited manufacturing -- a big industry in Ohio -- as a top concern and said the Commerce Department would have an assistant secretary to focus solely on the needs of manufacturers.

"I understand if it were a full (economic) recovery, to make sure people can find work, that manufacturing must do better," said Bush, who narrowly won Ohio in 2000.

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