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Matthew Rothschild | McCain's Right Wing Economics    â€¢

    Tuesday 15 April 2008

    Are Americans unusually stupid or is it something our president put in the water? As millions surrender their homes and sacrifice other standards of our nation's economic and political reputation to the caprice of the Bush-Cheney imperium, a majority of voters tell pollsters that they might vote for a candidate who promises more of the same.

    Assuming that likely voters are not now thinking of yet another Republican president simply because John McCain is the only white guy left standing - an excuse as pathetic in its logic as the decision four years ago to return two Texas oil hustlers to the White House because they were not Massachusetts liberals - must mean that tens of millions of Americans have taken leave of their senses.

    If not the white-guy syndrome, why would even a shocking minority of Hillary Clinton and Barack Obama supporters say they prefer McCain to the other Democrat? How otherwise to explain the nation's widespread bipartisan rejection of the Bush presidency and yet a willingness to let McCain continue in that vein?

    To be sure, as a senator, McCain has exhibited flashes of independence on behalf of taxpayers, as in his support of campaign-finance reform in which he partnered with Democrat Russ Feingold. McCain's investigations of the military-industrial complex's shameless exploitation of terrorism fears set a high standard, as in exposing the air-tanker scandal that dispatched a Boeing exec and a former Pentagon employee to prison. But his political ambition is showing. Although he previously harshly criticized the enormous waste in the Iraq occupation, today, as a presidential candidate, he opens the door to a hundred years of taxpayer dollars tossed down the drain in Iraq. The man who was tortured now hugs a leader who authorized the same.

    By so unabashedly embracing the most glaringly failed U.S. president ever, McCain has surrendered the right to be considered an independent candidate, judged on his own merits and personal history. A vote for McCain is a vote for that rancid recipe mixing religious bigotry, imperial arrogance and corporate greed that he had stood against in the run-up to the 2000 presidential election when he challenged George W. Bush, but to which he now has capitulated.

    Too harsh? Then consider just how tight the space is between the rocks of our failed Mideast policy and the hard place of our impending financial disaster. The sudden out-of-control spike in the cost of oil - the key short-term market variable, the specter that stokes inflation fear and limits moves to avoid recession - is not a natural disaster or in any realistic way the result of inefficiency in the use of energy. What more than doubled the price of petroleum in the short run was not that too many of us bought Hummers, but rather that the political stability of the region that contains the bulk of that oil was deliberately and recklessly roiled.

    In the name of fighting the 9/11 terrorists, the Bush administration overthrew the one Arab government most adamantly opposed to the Saudi financiers of that son of their system, Osama bin Laden. Instead of confronting the royal leaders of a kingdom that supplied 15 of the 19 hijackers, we invaded a nation that supplied not a single one. While Bush overthrew Saddam Hussein, who had no ties to the hijackers, he embraced the leaders of Pakistan, Saudi Arabia and the United Arab Emirates, the only three nations in the world that had diplomatically recognized and supported the Taliban sponsors of al-Qaida.

    Consider that historical marker at a time when the UAE and Saudi Arabia bankers are buying major positions in distressed U.S. financial and other key corporate institutions. I know, it all sounds too conspiratorial, like imagining that we might wake up from this national nightmare and discover that the CEO of Halliburton, who replaced Dick Cheney when the latter selected himself to be Bush's vice president, now has his headquarters in Dubai, tucked safely into the obscenely oil-revenue-rich UAE that our troops were sent to Iraq to protect.

    There is no national outrage, or even seriously sustained media interest, over the fact that Cheney's old company profited enormously from ripping off U.S. tax dollars going into the Iraq occupation. Nor is there even much curiosity about the shenanigans of Halliburton, which is doing business with Arab oil sheiks at a time when the U.S. banks these Middle Eastern oil interests bought into are moving to foreclose on American homeowners.

    It's just the sort of egregious betrayal of the trust of the taxpayers that Sen. McCain would have gone after, before he sought to don the soiled robes of the Bush presidency.

    Go to Original

    McCain's Right Wing Economics
    By Matthew Rothschild
    The Progressive

    Wednesday 16 April 2008

    So John McCain, who admitted a while back that he didn't know jack about economics, proved it again on Tuesday when he unveiled his economic plans.

    He said, "It will not be enough to simply dust off the economic policies of four, eight, or 28 years ago."

    But he not only is dusting them off, he's putting them up on the mantelpiece.

    He would make permanent the Bush tax cuts and eliminate the Alternative Minimum Tax. By doing so, he would cost the Treasury $4 trillion over the next ten years, according to Aviva Aron-Dine, policy analyst at the Center on Budget and Policy Priorities.

    "It's a massively expensive tax plan," she says.

    It's also massively maldistributive.

    These tax breaks would go disproportionately to the very rich. "Half goes to people making over $200,000 a year - that's the top 4 percent," Aron-Dine says. "A little more than a quarter goes to the top 1 percent."

    This is redistribution of incomeÑfrom bottom to top.

    McCain also said he favored a "flatter" tax code. That means one that is less progressive, one that lets the rich keep more of their money. Since the days of Dwight D. Eisenhower, the tax rates have pancaked. In the 1950s, the marginal tax on the wealthiest Americans was 70 percent. Now it's half that much. And McCain wants to bring it even lower.

    And despite his populist talk about "no more corporate welfare" and about the "extravagant salaries and severance deals of CEOs," McCain announced he would "lower the business income tax for every employer that pays it." This would be a giveaway to businesses of about $90 billion a year, says the Center on Budget and Policy Priorities. McCain then added another $70 billion a year deduction for corporate investment and equipment and a $10 billion credit for R&D. That hardly constitutes ending corporate welfare as we know it.

    He said he'd pay for these corporate giveaways by freezing discretionary spending programs - the very kind of programs that could help people most in need, as well as jumpstart the economy.

    Here McCain exposed himself as a pre-Keynesian economist.

    Ever since the Great Depression, economists have understood that domestic government spending stimulates the economy much faster than business bennies and that such spending is crucial to get out of a recession. But rather than increase domestic government spending, McCain is going to throttle it.

    Nor did he advocate a crucial policy to revive the economy and spare people suffering: and that is, to increase federal revenue sharing with the states, which are facing huge budget shortfalls and are required to have balanced budgets. "At least 20 states have made or proposed budget cuts that threaten vital services for many residents, including some of the state's most vulnerable residents," according to a new study by the Center on Budget and Policy Priorities.

    These include cuts to education, health care for poor people, and programs for the elderly and the disabled. Tennessee, for instance, "has cut community-based services for the mentally retarded."

    Not only are state budget cuts savage. They are economically destructive. By strangling state spending, McCain would create a rolling recession from one state to another.

    And this is where his attack on "earmarks" is so counterproductive. Many earmarks go for positive things: bridges and roads, university expansions, urban housing, etc. By vowing to veto each and every "earmark," McCain will end up choking the states all the faster. They will have less money for public works, therefore higher unemployment, less state income tax revenue, and then a bigger budget shortfall. Thus does the circle become vicious.

    As much as he tried to paint himself as an innovator, McCain revived the old Reagan proposal for a line-item veto (one that Bill Clinton, a true Republican, gave the Heimlich to when he was President).

    But the last thing we need is more Executive Branch power - especially in the hands of an economic ignoramus.

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