Tax plans show policy divide

The Morris affair could not have come at a worse moment for the Clinton campaign - notwithstanding the fact that his departure will be widely, albeit secretly, welcomed within the White House - especially among liberal staffers who resent his influence on Mr Clinton, and regard him as an amoral and machiavellian figure ready to betray bedrock Democratic principles for political advantage.

In last night's address, the President was expected to set out proposals to improve education, toughen the fight against crime, expand health care and reduce poverty.

He also promised to amend the controversial welfare bill, increasing protection for children. Arriving in Chicago on Wednesday, Mr Clinton reminded America that he was approaching end of his political career, as he prepared to fight "the first campaign for the 21st century and the last campaign for Bill Clinton".

Marginally less media-slick perhaps than the Republican convention in San Diego, at least until the Morris bombshell involving a prostitute this gathering had nonetheless been massively scripted, blurring some traditional distinctions between the parties to the point of invisibility.

But real differences do exist, most notably on taxes.

Mr Clinton has already promised a pounds 66bn ($100bn) tax cut package, centred on a tax credit for children.

To that he was expected to add $8bn, including a capital gains tax cut for home sellers, and incentives for employers to hire people coming off welfare.

This was aimed at fending off fierce criticism that, in his eagerness to neutralise a powerful Republican campaign issue - in line with Mr Morris's advice - he was casting the nation's poorest children to the wolves.

But the total does not approach the across-the- board 15 per cent tax cut promised by Mr Dole, worth $548bn, which Democrats claim would simply drive up the deficit and push the economy into recession.

In an enthusiastically received address on Wednesday, Vice-President Al Gore took some hefty swipes at Mr Dole. The 73-year-old former Senate leader, he said, was a "good and decent" man, but he was offering himself as "a bridge to the past".

But undismayed, the Republicans have seized gleefully on the Morris debacle.

They are touting it as both as a sign that liberals would be running the Clinton campaign henceforth, and as proof that Mr Clinton and the "sleaze factor" were inseparably linked.