Saudis Sever Ties to Taliban; Russia Backs Use of Air Bases
President 'Pleased'; Lawmakers Grapple With Stimulus Plan

By Dana Milbank and Glenn Kessler
Washington Post Staff Writers
Wednesday, September 26, 2001; Page A01

The Bush administration yesterday advanced its diplomatic effort to wage war on terrorist Osama bin Laden and Afghanistan's Taliban regime, securing a renunciation of the Taliban by Saudi Arabia and Russian consent to use former Soviet air bases for U.S. strikes.

The Saudi kingdom's severing of relations with Afghanistan's radical Islamic government and permission from Russia's defense minister for the United States to use military facilities in Tajikistan came as the Group of Seven, the world's wealthiest nations, agreed to join the United States in freezing terrorists' assets. At the White House, President Bush met with the Japanese prime minister, who offered nonmilitary support.

But a strong note of caution was sounded by Pakistan, a crucial ally in any campaign, when it warned the United States against trying to install a new government in Kabul. Foreign Minister Abdul Sattar urged the Bush administration to put aside any notion of supporting Afghan opposition groups that are battling to replace the ruling Taliban, which has intimate ties with Pakistan's security services.

Bush pronounced himself "most pleased" at the Saudi move and a "strong statement" of support from Russian President Vladimir Putin, which was followed by Tuesday's permission to use the old Soviet bases. "The coalition of legitimate governments and freedom-loving people is strong," Bush said. "People will contribute in different ways to this coalition. . . . The duties of the coalition may alter, but the mission won't alter. And that is to rout out and destroy international terrorism."

The diplomatic developments came as Bush and congressional leaders met at the White House to grapple with whether to push forward with an economic stimulus plan, and if so, what size it should be. Federal Reserve Chairman Alan Greenspan and former Clinton treasury secretary Robert E. Rubin, meeting behind closed doors with the Senate Finance Committee, cautioned that any stimulus package should be temporary but big enough -- as much as $100 billion -- to have an impact. About $55 billion already has been approved for aiding the economy.

Some of the bipartisan spirit that followed the Sept. 11 attacks on the World Trade Center and the Pentagon began to fray on Capitol Hill as lawmakers quarreled over education funding and other budget matters. Senate Majority Leader Thomas A. Daschle (D-S.D.) doubted the wisdom of further stimulus measures, and a new analysis by the Democratic staff of the House Budget Committee found that the slumping economy and a rush to boost spending could quickly push the government back into deficit.

Consumed by war planning, the White House announced that Bush's 10-day trip to Asia next month will be shortened. Bush will still visit Shanghai Oct. 20-21 for the annual summit of the Asia Pacific Economic Cooperation (APEC) forum, but will defer stops in Tokyo, Seoul and Beijing. As U.S. troop strength continues to build in Central Asia, Bush and his aides continued to leave ambiguous -- deliberately, administration officials suggest -- the extent of the U.S. war aims.

Strolling outside the West Wing with Prime Minister Junichiro Koizumi of Japan, Bush said "the mission is to rout terrorists," and suggested that "one way to do that is to ask for the cooperation of citizens within Afghanistan who may be tired of having the Taliban in place." But the president added that "we're not into nation-building," appearing to back away from last week's more forceful statements against the Taliban. Later, White House spokesman Ari Fleischer said any U.S. action was not designed to "replace one regime with another regime."

The ambiguity reflects the sensitive diplomacy the administration is conducting as it seeks to win support from Muslim nations against bin Laden's al Qaeda network.

Saudi Arabia rewarded the administration's efforts with a vigorous statement from Riyadh severing all relations with the Taliban over its support of terrorists, including the Saudi-born bin Laden. "The Taliban government continues to use its lands to harbor, arm and encourage those criminals to continue with their terrorist activities," the Saudi government said.

Bush and his aides continued to outline a flexible alliance that would allow different nations to participate in different activities based on domestic constraints. Defense Secretary Donald H. Rumsfeld spoke at the Pentagon of "revolving coalitions" that would "evolve and change over time and military sensitivity." While the United States has been able to secure broad support against bin Laden and the Taliban, many participants, particularly Arab nations, have warned the administration against broadening its targets.

Rumsfeld also said the military had called up additional reservists and blocked imminent retirements to prepare for a protracted conflict that could last for years.

Rumsfeld and Secretary of State Colin L. Powell made a rare joint appearance on Capitol Hill, spending two hours providing top-secret briefings to Senate and House members. After meeting nearly all members of the Senate, Rumsfeld said he was heartened by the bipartisan support for the administration's efforts.

As war planners stitched together a delicate coalition, talks over a domestic stimulus package were equally fragile. Lawmakers have begun to realize that crafting a stimulus package that would satisfy both parties -- while not ruining the era of bipartisanship -- may be an impossible task.

Democrats favor money for lower-income individuals, while Republicans lean toward tax breaks for businesses and investors. The administration is still debating whether any additional stimulus is necessary. Daschle suggested that perhaps Congress has already passed enough legislation to stimulate the economy. "We've got to be very careful," he said yesterday, echoing Greenspan's warning.

Daschle's view was backed by an analysis by the Democratic staff of the House Budget Committee, which found that under an optimistic economic scenario and modest initiatives to fight terrorism, the government would run a small deficit of $8 billion in 2002, compared with the current projected surplus of $176 billion. But if revenue falls dramatically, the budget deficit would swell to $70 billion this year, and deficits would continue to run for three more years, according to the analysis.

Meanwhile, the Congressional Budget Office, in rough projections for the Senate Budget Committee, saw the slowing economy and costs stemming from the Sept. 11 attacks cutting the fiscal 2002 budget surplus to about $50 billion.

Fleischer would not commit to keeping the budget out of deficit. "The president's priority is to give the resources necessary to fight and win a war," he said.

In their meeting with the Senate Finance Committee, Greenspan and Rubin urged lawmakers to carefully consider whether a possible economic stimulus package was necessary. They said more economic data were needed to judge the impact on the economy of the Sept. 11 attacks, specifically mentioning upcoming reports on unemployment claims and sales of durable goods. They also said that tax changes should be temporary, not permanent, or else the government would run the risk of running a deficit and thus affect long-term interest rates.

"I think it has to be temporary but significant enough to make a difference," said Sen. Charles E. Grassley (R-Iowa). But he also said it was not clear that a stimulus package was necessary. Grassley said that Greenspan suggested remedies that would affect investors, such as tax cuts, while Rubin favored items that would boost consumer spending.

As they groped for solutions to the economic troubles, lawmakers skirmished on several fronts. The White House canceled a meeting between Bush and lawmakers who were negotiating education legislation after a partisan fight erupted over funding.

Democrats pressed for a vote on an aviation workers' package that would provide unemployment benefits, job training, and health insurance to the 100,000 people who have lost their jobs in the wake of the attacks. But Republicans in the House and Senate suggested they would resist any attempts to attach such a package to an airline security bill that may come up for a vote soon. Some GOP leaders suggested that Congress pass Bush's energy plan to counter the sudden instability in international oil markets.

Still, the president and congressional leaders sought to maintain unity in response to the attacks. House Minority Leader Richard A. Gephardt (D-Mo.) accepted an invitation to join Bush and House Speaker J. Dennis Hastert (R-Ill.) in Chicago on Thursday, where they plan to meet with airline workers.

Staff writers Juliet Eilperin and Alan Sipress contributed to this report.