Questions about McCain-nomics
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A few weeks ago John McCain famously admitted that he didn't know much about economics. Today, with the nation careening into a deepening recession, he sought to rectify that knowledge deficit by trotting out his new economic plan in a major speech in Pittsburgh that, if little else, demonstrated his mastery of the teleprompter.
Once one gets past the obligatory populist rhetoric extolling the virtues of "working men and women" and denouncing the "excesses of traders and speculators", the speech signals no departure from Bush-nomics. And where McCain does go beyond the policies that led to the current economic meltdown, serious questions are being raised that he would only make matters worse.
The heart of McCain's economic plan is his $1.7 TRILLION corporate tax cut on top of making Bush's $2 trillion tax cut permanent. In so doing, McCain is proposing a tax cut that is twice as large as, and far more regressive, than the Bush tax cut he originally opposed in 2001.
Then there's McCain's "gas tax holiday" that would run from May to Labor Day. Even the Wall Street Journal calls that one a "clunker." As Jared Bernstein at TPM observes:
Of course, such a windfall would only add to the the $4 billion a year tax break McCain is proposing for these same oil companies. And did I mention the nearly $2 billion a year for the insurance companies?
The regressivity of McCain's tax plan is breathtaking - even the proposed dependent deduction is worth far more to taxpayers in higher tax brackets. For a CEO, it's worth $1,225 per child; for a middle income earner like a secretary, it's $525 per child; and for a low income earner like a waitress, zero.
And so it goes. Here are questions about McCain's plan that deserve answers:
Will more corporate tax cuts lead to job growth, or simply more money in the pocket's of CEOs?
Will making the Bush tax cuts permanent further explode the national debt, thus contributing to the tanking of the dollar?
Will repeal of the Alternative Minimum Tax (for families making more than $100,000) increase the already widening income gap?
And how will McCain pay for all of these tax giveaways to the rich? It should be noted that back in February, McCain said he would propose a balanced budget by the end of his first term. According to the Associated Press, "'I've got to give you some straight talk: I doubt, given the deficits we're running, that I can propose a balanced budget in the first year,' McCain told a town hall meeting. 'But that's my goal. It has to be our goal, because we're mortgaging these young people's future.' McCain said he would propose a balanced budget by the end of his first term if elected." [Associated Press, 2/15/08]
But today on CNBC, McCain said his plan would provide for a balanced budget within eight years. When asked about his flip-flop on the Bush Tax Cuts during the interview on CNBC, McCain said, "We will have a balanced budget, if I am President of the United States, within eight years, because we will have fiscal discipline." [CNBC, 4/15/08]
Oh, and one more thing. There's nary a mention in the nearly 4,200 word speech about the costs of the Iraq War, nor of the 100 year U.S. occupation of Iraq envisioned by McCain.
Once one gets past the obligatory populist rhetoric extolling the virtues of "working men and women" and denouncing the "excesses of traders and speculators", the speech signals no departure from Bush-nomics. And where McCain does go beyond the policies that led to the current economic meltdown, serious questions are being raised that he would only make matters worse.
The heart of McCain's economic plan is his $1.7 TRILLION corporate tax cut on top of making Bush's $2 trillion tax cut permanent. In so doing, McCain is proposing a tax cut that is twice as large as, and far more regressive, than the Bush tax cut he originally opposed in 2001.
Then there's McCain's "gas tax holiday" that would run from May to Labor Day. Even the Wall Street Journal calls that one a "clunker." As Jared Bernstein at TPM observes:
The problem is there's absolutely nothing to stop the oil companies from claiming a big chunk of this subsidy by raising the pretax price of gas at the pump. Prices go up in the summer anyway, and I'll bet you a gallon of premium that they go up even more than usual, such that some of that 18.4 cents/gallon ends up back in Exxon's wallet, not yours.
Which leaves us with a nice little transfer from taxpayers to oil companies.
Of course, such a windfall would only add to the the $4 billion a year tax break McCain is proposing for these same oil companies. And did I mention the nearly $2 billion a year for the insurance companies?
The regressivity of McCain's tax plan is breathtaking - even the proposed dependent deduction is worth far more to taxpayers in higher tax brackets. For a CEO, it's worth $1,225 per child; for a middle income earner like a secretary, it's $525 per child; and for a low income earner like a waitress, zero.
And so it goes. Here are questions about McCain's plan that deserve answers:
Will more corporate tax cuts lead to job growth, or simply more money in the pocket's of CEOs?
Will making the Bush tax cuts permanent further explode the national debt, thus contributing to the tanking of the dollar?
Will repeal of the Alternative Minimum Tax (for families making more than $100,000) increase the already widening income gap?
And how will McCain pay for all of these tax giveaways to the rich? It should be noted that back in February, McCain said he would propose a balanced budget by the end of his first term. According to the Associated Press, "'I've got to give you some straight talk: I doubt, given the deficits we're running, that I can propose a balanced budget in the first year,' McCain told a town hall meeting. 'But that's my goal. It has to be our goal, because we're mortgaging these young people's future.' McCain said he would propose a balanced budget by the end of his first term if elected." [Associated Press, 2/15/08]
But today on CNBC, McCain said his plan would provide for a balanced budget within eight years. When asked about his flip-flop on the Bush Tax Cuts during the interview on CNBC, McCain said, "We will have a balanced budget, if I am President of the United States, within eight years, because we will have fiscal discipline." [CNBC, 4/15/08]
Oh, and one more thing. There's nary a mention in the nearly 4,200 word speech about the costs of the Iraq War, nor of the 100 year U.S. occupation of Iraq envisioned by McCain.
If revenue for our crumbling infrastructure is suspended, as Mr. McCain's gas tax vacation would do, we run the risk of more Minneapolis bridge accidents.