updated 8/21/2006 3:42:44 PM ET 2006-08-21T19:42:44

Even though he's not running for re-election this year, President Bush knows just what he would focus on if he were: the economy and taxes.

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As Republicans face an increasingly tough political outlook, in part because of Bush's sagging approval ratings, the president offered some advice Monday to GOP candidates in the midterm elections.

"If I were a candidate ... I'd say, 'Look at what the economy has done. It's strong. We've created a lot of jobs. ... I'd be telling people that the Democrats will raise your taxes. That's what they said. I'd be reminding people that tax cuts have worked in terms of stimulating the economy," Bush told reporters at a news conference.

Economic facts
The economy has slowed in recent months, in part because of the slump in the housing market. Recent economic indicators showed a 4.8 percent jobless rate in July and 4 percent annual economic growth rate through the first half of the year.

The Labor Department recently said employers added just 113,000 new jobs in July, down from 124,000 in June.

Public opinion
Only 37 percent of Americans support Bush's handling of the economy, according to the Associated Press-Ipsos poll in early August. The same survey showed Bush's overall approval rating at 33 percent.

As a candidate, Bush said he would remind voters of the "philosophical difference between those who want to raise taxes and have the government spend the money, and those of us who say, 'You get to spend the money the way you want to see fit. It's your money.'"

"I'd remind people that pro-growth economic policies had helped us cut that deficit faster than we thought," he said.

In 2000, the last year of the Clinton administration, the surplus was $236 billion. The $260 billion deficit forecast for the current budget year, which ends Sept. 30, is $112 billion below previous estimates. Tax revenues contributed to the smaller deficit.

Bush also said Republican and Democratic candidates should focus on working with the president to solve the budget problems facing the Medicare and Social Security programs.

"People expect us to come here to solve problems. And thus far, the attitude has been: Let's just kind of ignore what the president has said and just hope somebody else comes and solves it for us," he said.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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