Well if you go over to McCain's website, you'll see a long list of tax cuts proudly pointed out.
It's right here, for you to see :
http://www.johnmccain.com/Informing/Issues/
So that's on his own website, and that's what he is proposing as a plan for the American people in his presidency.
So let's start to look at this platform, and do some analysis, shall we ?
Someone's actually started to do just that, so let's see what we are looking at.
The McCain Tax Cut Cost-o-Meter»
Our guest blogger is Adam Jentleson, the Communications and Outreach Director for the Hyde Park Project at the Center for American Progress Action Fund.
thermoside3.gifJohn McCain wants to double the Bush tax cuts. But how does this erstwhile fiscal conservative plan to pay for it? An excellent question – and one his campaign has so far failed to answer.
McCain’s tax plan would cost a whopping $300 billion (to put that in perspective, we spend about $200 billion a year on the war in Iraq). According to our accounting, McCain has so far managed to offset a grand total of $33 billion, or 11% of his tax cut.
As we have chronicled on this blog, the other savings McCain claims are bogus. So where will this former budget hawk come up with the more than $250 billion he needs to pay for his plan?
In an effort to hold McCain accountable, The Wonk Room is introducing the Tax Cut Cost-o-Meter, which documents the gap between McCain’s tax cuts and the offsets he proposes to pay for them.
We’ll be updating our new thermometer as the McCain campaign finds ways to pay for its tax cuts — or doesn’t, as the case may be.
http://thinkprogress.org/wonkroom/2008/04/23/mccain-thermometer/
So it looks like we are talking about 300 billion dollars to be given up by the government, if these figures are correct.
So let's see what one of McCain's own advisers says :
A Q&A With McCain Adviser Douglas Holtz-Eakin
How does the state of the budget look to you?
If you look at the last full fiscal year, close the books on 2007, we raised 18.8 percent of GDP in [tax revenue] and spent a bit more than that, and we ran a modest deficit by postwar standards.... You roll the clock forward and you see the spending part of the budget explode, real pressures, and there is no way you can tax enough to meet those pressures—and if you tried, you would do such harm to the economy that it would ultimately fail. So the right approach is to take a comprehensive look at the spending commitments, undertake reforms in healthcare to slow the growth of Medicare, commit to solving the Social Security [solvency problem], which is a political problem more than anything else, deal with nondefense discretionary spending. That's the recipe.... Let's commit to getting the economy growing, and the revenue will be there. This is not a revenue problem; this is a spending problem.
http://www.usnews.com/blogs/capital-commerce/2008/4/14/
a-qa-with-mccain-adviser-douglas-holtz-eakin.html
A modest deficit, by postwar standards.....when the USA wasn't fighting a war with a cost like the one in Iraq, btw.
How much WAS that deficit ?
The deficit narrowed to $162.8 billion in the fiscal year that ended September 30, the third straight annual decline and lowest since $158 billion in 2002, the Treasury Department said yesterday in Washington.
Spending totaled $2.731 trillion for the fiscal year, compared with revenue of $2.568 trillion. While both figures were records, they fell short of White House projections. In July, Mr. Bush's budget office forecast 2007 revenue of $2.574 billion and spending of $2.779 billion.
http://www2.nysun.com/national/american-budget-deficit-falls-to-lowest-level/
So we are at (based on last year's figures) $ 163 billion negative.
Since September, the economy has changed quite a bit. I think we can all agree on that one.
We've had the sub-prime mess , which has cost a fortune:
* There will, as stated above, be 2 million foreclosures as the riskiest of the subprime adjustable rate mortgages reset to higher interest rates.
* Approximately $71 billion in housing related wealth will be destroyed by those 2 million foreclosures and another $32 billion will be lost because of the spillover effect of foreclosures in neighborhoods and communities. The report quoted a study on housing values in Philadelphia which found that an abandoned property lowered the value of homes located within 150 feet by an average of 10 percent and those within 450 feet declined in value by an average of 5 percent.
* Collectively the states stand to lose close to $1 billion in revenues as property tax assessments drop in value.
* Foreclosures aside, there will be a 10 percent decline in housing prices which will lead to a $2.3 trillion economic loss.
http://www.mortgagenewsdaily.com/10262007_Subprime_Cost.asp
This type of loss in the market is going to be partially supported by the government, and it will also impact on revenue the government can collect from taxes.
Let's commit to getting the economy growing, and the revenue will be there.
And it won't be, as the effects of all the forces in the market depress it.
So let's continue with McCain's spokesman :
How will you balance spending and the tax cuts Sen ator McCain has proposed?
It's not that complicated.... He wants to repeal the [alternative minimum tax]. That's about $60 billion in additional revenue losses. Fine. We have $60 billion in discretionary spending that was sourced to earmarks. He believes that should go away....
Someone checked those figures.
Holtz-Eakin says that money could be used to fix the repeal the alternative minimum tax. The problem is that virtually no one can find even a third that much money in the annual spending bills in earmarks.
The most credible effort at earmark accounting in recent years was completed recently by the Taxpayers for Common Sense. They did an exhaustive review of the 2008 spending bills and reported $18.3 billion in earmarks. The White House Office of Management and Budget scrubbed the twelve 2008 appropriation bills and came up with only $16.9 billion. Where does McCain’s other $41.7 billion come from?
There is virtually no explanation. Did Congress spend money in other areas that McCain is counting but neither Taxpayers for Common Sense for the White House counts? That seems to be a hard argument to make. For 2008, the President’s request totals $932.8 billion (not counting the pending supplemental.) The Congressional Budget Office scores the action taken by the Congress on the 2008 appropriation bills at $932.8 billion—exactly the amount requested.
There were some areas that Congress spent more than the President requested and other areas where Congress spent less than the request. But McCain would find it difficult in most instances to object to the judgments made by Congress, for instance the $3.8 billion to improve the quality of health care for returning veterans which was included in the final Military Construction—Veterans bill but not contained in the President’s request.
It is even difficult to imagine that McCain would want to get rid of all of the earmarks. $1.2 billion of which was for better housing and facilities for servicemen and their families at military installations around the world.
The disturbing point here, however, is that even by the loose rules of budget discipline used in Washington in recent years this accounting is completely off the wall. Revenue cuts that are offset by phony spending reductions simply add to the deficit and the nation’s long term debt burden. Senator McCain needs to detail his figures in a manner similar to the materials provided by OMB and Taxpayers for Common Sense.
http://thinkprogress.org/wonkroom/2008/04/16/earmarks-mccain-proposal/
So you drop 60 billion from the AMT , and replace that with.....16.9 billion ?
That's 41.7 Billion in the hole....to start.
And then the corporate tax breaks ,
The one that is going to be getting attention is if we cut the corporate income tax from 35 percent to 25 percent—which is a competitiveness must—you, in some static sense, lose $100 billion a year ballpark. That's real. But you can broaden the base.
- Ibid
OK, 100 billion plus that 41.7 billion = 147. billion dollars negative (so far)
How's that base going to broaden ?
There are $30 billion a year in rifle shots that you should go after. You can count on some economic feedback, some 30 percent. So that gets you to $60 billion. So the net loss is $40 billion, and we think we can get 40 more in spending.
- Ibid
Now the economy is depressed, that we know.
We also have to add on the loss from that '09 tax rebate that the government's giving US citizens right now. That's income that the government WON'T be getting next year.
So how much is that ?
$110 billion dollars, approximately.
So we are now at 147.1 billion + 100 billion = 247.1 billion dollars.
And it's not over....
Just here, without going any farther, we exceed the level of the existing deficit.
If the economy equaled 2007, in every way (which it won't) , the deficit would be the same (assuming all costs are the same, which they won't be either) but let's start there.
163 billion deficit 08 ( highly optimistic)
247 billion in additional money given away as tax cuts
310 billion total dollars, and we've not even finished with all of McCain's proposals yet.
Any gains to the economy by the injection of that cash into are not going to overcome those types of numbers. And those numbers are based on some incredibly optimistic numbers for this year's deficit - and we all know it's pretty much a slam dunk that they won't.
So any McCain supporters out there willing to explain how he's going to accomplish all of this ?
Doesn't this show you the base problem with electing McCain as president is going to be a staggering increase in the public debt - almost without doubt ?
There's been some argument over how to treat John McCain's policy ideas. Some folks hold that they're terrible and should be opposed. Others think they're terrible, but more than that, they and make no sense, and McCain clearly doesn't mean them so they should be ignored. This, I think, is the take of most of the media, which assumes that, on domestic policy, McCain is pandering to his base and shouldn't be taken seriously. But, at the end of the day, these are his policies, and she should be forced to stand by them. It's not for the media to decide that he's a) lying and b) that's okay.
Take McCain's tax policy, for one. He wants to repeal the Alternative Minimum Tax ($430 billion in lost revenue over 10 years), cut the corporate tax rate from 34 percent to 25 percent ($995 billion lost over 10 years), and end taxation of corporate investment in technology and equipment ($745 billion over 10 years). In addition, he's going to make the Bush tax cuts permanent. We're now talking a revenue loss of over $3 trillion. How's he going to fund his wars?
What's even more remarkable, though, is how regressive McCain's cuts are. They're more regressive, by far, than the Bush tax cuts. The Center for American Progress just released a report showing how much of each set of cuts goes to each income quintile, and I've put the results into a graph for you. McCain is in blue, Bush is in red.
On foreign policy, it's become common to say that McCain is like Bush, only more so. What's impressive is that he's proving that true on domestic policy, too. And yet despite the $3 trillion+ hole he's blowing in the deficit, the media regularly reports that McCain is a deficit hawk. Why? Because he doesn't like earmarks ($18 billion per year). Quite an age we live in, where fiscal responsibility is paying for about 1/20th of your spending. This guy is the Republican nominee for president. It's time the media began asking him how he's going to pay for all his spending. If he's going to cut Medicare and Social Security -- the only expenditures large enough to support this plan -- let him say so. That, supposedly, is the virtue of McCain, that he says stuff like that. But it's a bit dumb for the media to be all excited about a guy who answers your questions and then not actually ask him the hard questions.
http://www.prospect.org/csnc/blogs/ezraklein_archive?month=03&year=2008&
base_name=chart_of_the_day_john_mccain_w
McCain has consistently voted against mortgage protections and other steps to help consumers fight unfair credit terms. A look at his record:
– McCain voted against discouraging predatory lending practices. In 2005, McCain voted against an amendment prohibiting law-breaking high-cost predatory mortgage lenders from collecting funds from homeowners who are forced into bankruptcy court. [S. 256, 3/03/05]
– McCain failed to vote on bill to overhaul mortgage lending practices of FHA. In 2007, McCain failed to vote on passage of a bill that would overhaul the mortgage lending practices of the Federal Housing Administration (FHA). The bill would reduce the required minimum down payment for an FHA-insured loan and simplify its calculation, requiring a flat 1.5 percent of the appraised value of the home. [S. 2338, 12/14/07]
–- McCain failed to sign on to the Predatory Lending Consumer Protection Act. In 2003, McCain failed to add his name to this legislation, which was intended to “protect consumers against predatory practices.” The bill, which was endorsed by a host of civil rights and housing advocates, including the U.S. Conference of Mayors, ACORN, and the Consumer Federation of America. [S. 1928, 11/21/03]
– McCain failed to sign on to Truth in Lending Act. Less than four months ago, McCain failed to sign on to this bipartisan initiative providing protection to consumers taking out home mortgage loans. Among other measures, it was designed to “establish new lending standards to ensure that loans are affordable and fair.” McCain also refused to co-sponsor this legislation in the 107th Congress as well. [S. 2452, 12/12/2007]
McCain’s primary solution to dealing with the flailing economy? Waiting it out. Also on ABC’s This Week on Feb. 17, when asked whether he was “open to helping homeowners,” McCain replied, “I am open to helping homeowners. I would rely to a large degree on the situation of time.”
http://www.realmccainblog.com/search/label/economy%20and%20taxes
His health care plan ?
McCain's Health Plan: Tax Benefits, Increase Costs. His plan would make employer-provided health benefits part of taxable income, essentially creating a new tax for working families. It undermines existing employer-based health care and pushes workers into the private market to fight big insurance companies on their own. It would reduce benefits, increase costs and leave many with no health care at all. (Center on Budget and Policy Priorities, 4/5/06; Health08.org Forum, 10/31/07; Los Angeles Times, 11/20/07; The Commonwealth Fund, 6/20/05)
Anti-union ?
McCain on Rights: Oppose Freedom to Form Unions and Bargain. McCain voted to block the Employee Free Choice Act, which would level the playing field for workers trying to form unions and bargain with their employers for better pay and conditions. But he voted for a national "right to work" for less law that would cripple workers' unions. (H.R. 800, Vote #227, 6/26/07; S. 1788, Vote #188, 7/10/96)
Privatizing Social Security ?
McCain on Retirement Security: Privatize Social Security, Cut Medicare. McCain supports privatizing Social Security, putting our retirement at risk, and raising the Medicare eligibility age. (SCR 83, Vote #68, 3/16/06; SCR 18, Vote #49, 3/15/05; S. Amdt. 144 to SCR 18, Vote #47, 3/15/05; SCR 86, Vote #56, 4/1/98; SCR 86, Vote #77, 4/1/98; S. 947, Vote #112, 6/24/97; S. Amdt. 445, Vote #115, 6/25/97)
In 2000 he said:
“There’s one big difference between me and the others–I won’t take every last dime of the surplus and spend it on tax cuts that mostly benefit the wealthy.” [McCain campaign commercial, January 2000]
In 2003 he said:
“But when you look at the percentage of the tax cuts that–as the previous tax cuts–that go to the wealthiest Americans, you will find that the bulk of it, again, goes to wealthiest Americans.” [NBC’s “Today,” Jan. 7, 2003]
Now?
"Oh, yes, sure, the wealthy, the wealthy. Always be interested in when people talk about who the, quote, “wealthy” are in America. I find it interesting."
His voting record seems to back that up :
Then, as he contemplated another run for the presidency, McCain had another change of heart. The key provision of the 2003 tax cut bill that he had opposed was the tax cut for capital gains and dividends. But In 2005 he voted for the budget reconciliation bill that extended that very gift to the wealthy for an additional two years.
McCain had earlier complained that "repeal of the estate tax would provide massive benefits solely to the wealthiest and highest-income taxpayers in the country," but in 2006 he decided that repealing most of the estate tax was just fine by him. He voted that year for the bill to gut the estate tax, which won a majority of votes in the Senate but failed to obtain the 60 votes needed for passage.
But it's also astounding because even Bush's Treasury Department has admitted (in a report released in 2006) that tax cuts cannot possibly pay for themselves. Sure, lower taxes might create some incentive to work and invest, resulting in some more income and thus more tax revenue, but that will never make up for more than a small fraction of the cost of a tax cut.
Does McCain believe, contrary to almost every mainstream economist, the ludicrous proposition that we can raise revenue by cutting taxes? Or has he been altering his view to win over an extreme fringe within his party to win its nomination?
http://www.ctj.org/taxjusticedigest/2008/02/john-mccain-straight-talk-on-t.html
Holtz-Eakin also told FactCheck.org that the families to which McCain refers would save an average of $2,000 a year. That means some would save more and some would save less. Those in higher income groups pay much more of AMT taxes than do those with lower earnings, and they would reap more of the benefits of repealing the tax as well. About 90 percent of the tax benefits of doing away with the AMT in 2007, for instance, would have gone to households in the $100k and above group; 55 percent would have gone to households earning more than $200k.
http://www.newsweek.com/id/136986
The rich get richer....
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