John McCain is campaigning for president on a platform of budget-busting tax cuts for the rich. In fact, he would cut taxes for the top 1 percent of taxpayers by nearly $150 billion a year.
But McCain opposed Bush’s tax policies before he supported them. So would he govern as the moderate on taxes he was in 2001 or the enthusiastic tax-cutter he is today? McCain’s true intentions were one issue discussed by Gene Sperling and Jared Bernstein at McCain U earlier today.
The easiest way to know what McCain would do as president is to ask him – and he says he wants deep, regressive tax cuts.
But his voting record also matters. And it’s true that, on taxes, McCain was a moderate before he was a conservative. But he was also a conservative before he was a moderate. According to Grover Norquist’s right-wing tax group, Americans for Tax Reform, McCain’s record has three stages:
– Between 1994 and 1997, McCain voted with ATR 100 percent of the time, demonstrating a “Reagan-like” record on taxes.
– Between 1998 and 2003, McCain’s ratings were lower, reaching a low of 55 percent in 2001.
– Since 2004, ATR writes, “McCain has slowly tried to reinvent himself as a taxpayer friendly senator.”
It’s not McCain’s current right-wing tax agenda that is the exception to his career-long record. Instead, it’s his opposition to the Bush tax cuts that was the break from his past.
McCain’s new ad touting his deeplyflawed energy strategy contains (yet another) new campaign slogan as well: “Country First.”
Watch the ad:
Unfortunately for our country, however, John McCain’s economic plan puts corporations first.
The central plank of his economic plan is a $175 billion corporate tax cut that would slash taxes for the Fortune 200 corporations by $45 billion every year. That includes $6.5 billion for Fortune 200 energy companies, $6.3 billion for Fortune 200 banks and financial institutions, and $5.6 billion for Fortune 200 merchandising and retailing companies.
The overwhelming benefits of this tax cut, approximately 59%, would flow to the top 1% of income earners.
A new consumer confidence report released on Tuesday suggests that “Americans feel downright terrible about the economy as it is, and their expectations for the near future are even more depressed.” According to the report, the June consumer confidence index fell to 50.4, the lowest level since 1992. One economist observes:
This is incredibly awful…Even as some people spend their tax rebates … the majority appear to be overwhelmed by the surge in gasoline and food prices, and the drop in stock and home prices.
Americans seem both overwhelmed and increasingly pessimistic. The expectations index, for instance — the measurement of “how people figure things will look in six months” — dropped to 41.0, “the lowest figure in the 40 years of the survey, and broke through the previous low of 45.2 reached in December 1973 — just as the economy was beginning to plunge into recession from the effects of the surge in oil prices that followed the Arab embargo announced that fall.”
If you’re a CEO of one of America’s largest corporations and have enjoyed the Presidency of George W. Bush, a contribution to the McCain campaign is looking like a pretty good investment.
A new report from the Center For American Progress Action Fund finds that a key piece of John McCain’s tax plan — cutting the corporate tax rate from 35% to 25% — would cut taxes by almost $45 billion every year for America’s 200 largest corporations as identified by Fortune Magazine.
Eight companies — Wal-Mart Stores Inc., Exxon Mobil Corp., ConocoPhillips Co., Bank of America Corp., AT&T, Berkshire Hathaway Inc., JPMorgan Chase & Co., and Microsoft Corp. — would each receive over $1 billion a year.
The following table shows the tax savings to America’s five largest firms. See a full list of all 200 companies and their savings under McCain here:
At a townhall event in Fresno, CA, yesterday, Sen. John McCain (R-AZ) reiterated his call for a gas tax holiday “to give you a little relief for the summer.” As NBC reports, he then promoted his support for lifting the offshore drilling moratorium, admitting that it wouldn’t provide any “immediate relief“:
I don’t see an immediate relief, but I do see that exploitation of existing reserves that may exist — and in view of many experts that do exist off our coasts — is also a way that we need to provide relief. Even though it may take some years, the fact that we are exploiting those reserves would have a psychological impact that I think is beneficial.
Two months ago, he promoted the useless and feckless gas tax holiday for its “psychological boost,” so it makes sense that McCain is now promoting a useless and destructive expansion of offshore drilling for its “psychological” impact. Why is he offering “psychological” solutions to $4 gas? McCain argues that “a lot of our problems today” are “psychological,” including “the confidence, trust, the uncertainty about our economic future,” and even “the ability to keep our own home.”
Watch it again:
While skyrocketing gas prices, foreclosures, unemployment, food prices, climate disasters, and continued war certainly do bring significant psychological damage to those affected, the right way to deal with those issues isn’t to offer right-wing Prozac — it’s to solve the problems. And McCain’s incoherent and unhealthy policy prescriptions certainly won’t.
UPDATE: Here’s the video of McCain in Fresno:
UPDATE II: At the Carpetbagger Report, Steve Benen notes the bizarre inconsistencies of McCain saying his ideas are “practical” but only have “psychological” benefits:
The incoherence here is breathtaking. McCain believes drilling is part of a short-term solution. He also believes drilling offers no real short-term solutions. McCain believes a gas-tax holiday will produce big savings for consumers. And no savings for consumers. McCain believes we need pragmatic policies that work. He also believes we need psychic policies that make people happy whether they work or not.
Today, during a town hall meeting in Fresno, California, Sen. John McCain (R-AZ) advocated boosting funding for public transportation. Replying to a question about increasing fuel prices, McCain joked that public transportation was the only issue “we agree on.”
But the senator’s sudden embrace of public transportation contradicts his vocal support for the gas-tax holiday. In fact, according to the American Public Transportation Association, McCain’s proposal to suspend the gas-tax “runs counter to the public demand for more public transportation“:
The truth is that we need the federal gas tax to pay for the much needed highway and public transportation infrastructure. Do we really want our bridges to fall down? No. Do we want to see bus routes and train lines cut?No. Americans are used to their independence and want their transportation systems to not only be maintained, but improved and expanded.
McCain’s gas-tax proposal “would eliminate $1.4 billion of federal funding for public transportation and severely restrict the industry’s ability to add and improve transit services for a growing number of Americans.”
It seems that the gas tax holiday is just one more issue that “is not something” McCain has “understood as well” he should.
Yesterday, on CNN Late Edition, McCain Senior Economic Adviser Douglas Holtz-Eakin claimed that John McCain’s tax plan didn’t include tax cuts for the rich:
BLITZER: But is this true, the suggestion that [Barack Obama] saying you want to give a huge tax break to those Americans making $2.8 million a year and more, that’s true, right?
HOLTZ-EAKIN: No…Mr. Obama is talking about tax cuts for the wealthy. They’re not anywhere. What John McCain would do is reduce the corporate tax rates that’s sending jobs that have pension benefits, health benefits and important security for Americans, he’s cutting rates.
Holtz-Eakin is being wildly misleading. A recent analysis from the non-partisan Tax Policy Center found that McCain’s plan, which includes a dramatic AMT revision, a corporate tax cut, and a doubling of the dependent exemption, “would primarily benefit those with very high incomes, almost all of whom would receive large tax cuts that would, on average, raise their after-tax incomes by more than twice the average for all households.” In other words, it’s a huge tax cut for the rich:
But McCain neglected to mention that he opposes a key way to encourage investment (and, therefore, jobs) in the United States: eliminating the tax incentives for companies to keep profits overseas instead of reinvesting them in the United States.
By leaving profits overseas, U.S. companies can indefinitely postpone (i.e. totally avoid) paying U.S. corporate taxes.
As Martin Sullivan of Tax Noteswrites, “The U.S. tax system does provide an incentive to locate production offshore.”
Fiorina, speaking for the campaign, has insisted that eliminating these incentives is unnecessary if the corporate rate is cut from 35% to 25% as McCain proposes, but, as George Stephanopolous neatly pointed out during an interview with Fiorina, this argument is absurd on its face: corporations face zero taxes if they leave their profits overseas, and 25% is still a whole lot bigger than zero.
In an op-ed in the Detroit Free Press, McCain wrote, “those who would lead our countries must work to ensure that the benefits of NAFTA are understood throughout our countries.”
Perhaps it’s time McCain made his continued desire to put corporate profits ahead of American jobs “understood throughout our countries” too.
Today, the Center for American Progress released a new report which finds that “the media ignores ordinary workers and instead covers economic issues from the perspective of business.”
Wednesday’s Washington Post article on why Americans are “gloomier than the economy” exemplifies this trend. The reporter, Neil Irwin, sets out to prove that the economy is not as bad as most Americans believe:
Ask Americans how the economy is doing, and their answer is stark: It is not just bad, it is run-for-the-hills terrible…But the reality is different…This has left economists trying to figure out why Americans’ perceptions are so much more negative than the data analysts use to measure how things are going.
But, Irwin’s reliance on elite economic sources and his disregard for the views and opinions of average working class Americans provides little insight into “Americans’ perceptions.” While Irwin’s five economic sources speculate on why Americans feel “gloomier,” by avoiding talking to a single ordinary worker, the article fails to mention that incomes for most workers have declined since 2001, that healthcare and retirement benefits have become scarcer and more expensive, and that inequality has risen to unprecedented levels.
Unfortunately, this type of coverage is the norm, not the exception. According to the report, which looked at newspaper and television coverage of unemployment, minimum wage, trade, and credit card debt issues in 2007, “the perspective of workers is largely missing from media coverage, while the views of business are frequently presented”:
- Representatives of business were quoted or cited nearly two-and-a-half times as frequently as were workers or their union representatives.
- In coverage of both the minimum wage and trade, the views of businesses were sourced more than one-and-a-half times as frequently as those of workers.”
- In stories about employment, “businesses were quoted or cited over six times as frequently as were workers.”
- Only in coverage of credit card debt “was coverage more balanced, presenting the perspectives of ordinary citizens in the proportion as those of business.”
During a panel discussion about the report, Philip Dine, Pulitzer Prize-nominated journalist and author of State of the Unions, also noted the unfair language the media uses to cover labor issues:
Why do we talk about a labor dispute when it’s a labor-management dispute?…Why do we talk about labor bosses when they’re the only ones in the workplace who are elected, democratically, and can’t fire or hire people whereas the people who aren’t elected and can fire and hire, we call executives…And why do we always say unions are demanding something, during a contract situation, and companies are offering? Why don’t we switch that around say labor or union is offering to work for certain conditions but the company is demanding they accept something else?
As David Madland, author of the report and Director of CAP’s American Worker Project, argues, such bias matters. In fact, the media “has the ability to help determine which issues people think are important” and “can even influence how people vote.” Some studies have found that as Fox News expanded into new towns, these areas were increasingly likely to vote for Republican candidates,” while viewers of ABC News were “influenced to vote for Ronald Reagan over Walter Mondale because Peter Jennings used more positive facial cues when talking about the president than he did about the challenger.”
Fortunately, the study’s conclusion that the media provided fairly balanced coverage of credit-card debt, suggests that it’s capable of covering economic issues more fairly. Americans deserve and should demand better.
Our guest blogger is Adam Jentleson, the Communications and Outreach Director for the Hyde Park Project at the Center for American Progress Action Fund.
The government’s official source for energy statistics says that offshore drilling will not have a “significant impact” on gas prices until 2030.
McCain’s own campaign admits that offshore drilling will have no short term effect on gas prices:
“Douglas Holtz-Eakin, a senior advisor to McCain’s campaign, acknowledged in a conference call to reporters that new offshore drilling would have no immediate effect on supplies or prices.”
Yet McCain insists on touting offshore drilling as the best way to “assure affordable fuel for America,” as he said in his speech on Tuesday.
This begs the question: can John McCain find a single economist who backs his claim that offshore drilling will lower gas prices in the short term – or even before 2030?
If not, what is the basis for his claim that offshore drilling will lower gas prices?
This is not the first time McCain has had trouble finding economists who would endorse his proposals for lowering gas prices – in fact, just a few weeks ago, McCain failed to find a single economist who would endorse his claim that a temporary suspension of the gas tax would provide significant relief for American families.
The policy was so thoroughly discredited that the only argument McCain and his team could muster was to simply bash economists as a group.
At a campaign stop in New Hampshire, a frustrated McCain told the audience, “If you want to call it [his gas tax proposal] a gimmick, fine. You know the economists? They’re the same ones that didn’t predict this housing crisis we’re in.”
On “This Week” with George Stephanopoulos, Senior Advisor Carly Fiorina, “scoffed at the lack of support from economic analysts. ‘I don’t think it matters,’ she said.”
Even Senior Advisor Douglas Holtz-Eakin – a Ph.D. economist himself – got in on the act, saying, “You can stack all the economists end to end and still not find common sense.”
Is this déjà vu all over again? Can McCain find a single economist to back his claim that offshore drilling will lower gas prices, or will his campaign be left with no recourse but to roll out poor Douglas Holtz-Eakin to trash his own profession, yet again?
UPDATE: The Huffington Post takes up the challenge and reports, “the consensus seemed to be that if the presumptive GOP nominee was persuading voters that he could help decrease their gas bill, he was either living in a political fantasy or being disingenuous.”
It’s not often that Karl Rove, former adviser to President Bush, has something negative to say. JUST KIDDING! But even Karl Rove outdid himself in an op-ed in today’s Wall Street Journal, in which he criticizes aspects of both Senator Obama and Senator McCain’s economic plans by calling the candidates “economically illiterate and irresponsibly populist.”
McCain is economically illiterate… and has conceded as much. But Rove’s critique of Obama, however, focuses on one central element: The senator’s support of a windfall tax profit on American oil companies. In Rove’s view:
Why should we stop with oil companies? They make about 8.3 cents in gross profit per dollar of sales. Why doesn’t Mr. Obama slap a windfall profits tax on sectors of the economy that have fatter margins? Electronics make 14.5 cents per dollar and computer equipment makers take in 13.7 cents per dollar, according to the Census Bureau. Microsoft’s margin is 27.5 cents per dollar of sales. Call out Mr. Obama’s Windfall Profits Police!
There are a couple things wrong with Rove’s logic here. First is his misunderstanding of the phrase ‘windfall profit.’ According to the dictionary definition, a windfall profit is a “profit that occurs unexpectedly as a consequence of some event not controlled by those who profit from it.” So something like, let’s say, a huge and unexpected increase in the cost of oil over the course of six years, might fall into those parameters. And these price increases occurred due to factors that big oil had no control over — the plunging value of the dollar, speculators gone wild, and growing demand from the developing world. They do have control over one factor linked to skyrocketing oil prices: stagnant demand. Despite record profits, oil companies are only investing $10 billion annually into new exploration – or about 10 cents for every dollar of profit.
Something like profits made on increased computer sales or cell phones, does not.
To back this up with numbers, the five largest American oil companies have seen their average profits increase from $37 billion in 2001, to $81 billion in 2004, to $123 billion in 2007–a total annual increase of $86 billion in six years. Since Bush became president, the big five companies made mroe than $600 billion. As a point of reference, between 1977 and 1983, oil company profits increased by $3.6 billion. Between 1990 and 1996, profits increased $.3 billion. A $86 billion increase in six years, coupled with a quadrupling in price for a barrel of oil is the epitome of a windfall profit — and is not the same as a Best Buy making money on flat screen televisions.
Secondly, if Rove really wants to compare profits between industries, then let’s actually compare profits between industries. According to US News and World Report
Exxon Mobil’s profits are 80 percent higher than those of General Electric, which used to be the largest U.S. company by market capitalization before Exxon left it in the dust in 2005. The new economy? Microsoft earns about a third as much money. And next to Exxon, the world’s largest retailer, Wal-Mart, looks like a quaint boutique, with annual profits of about $11 billion.
So if Rove wants to know “why isn’t [Obama] targeting other industries?” the answer is simple: none of these other industries are suddenly reaping the largest profits claimed in corporate history, and benefiting from record prices while American families suffer.
The Center for American Progress Action Fund released a new report by Michael Ettlinger, Vice President for Economic Policy, showing the stark difference between the tax plans offered by Senators John McCain and Barack Obama using two real families as examples: the McCains and the Obamas. Based on information from their 2006 tax returns, Ettlinger shows, line by line, the tremendous savings offered under the Bush tax cuts. He contrasts this with the even greater savings under McCain’s plan and the substantial, albeit smaller, savings under Obama’s plan.
How Rich Are They?
Neither the McCains nor Obamas are doing badly. In 2006, the Obamas had an almost entirely earned income–the bulk coming from Senator Obama’s success as an author. The McCain’s financial situation is more cloudy. Senator and Mrs. McCain filed their returns separately — Mrs. McCain, the primary source of wealth for the family, did not disclose her entire tax record, making it more difficult to determine exactly the amount of their income. In the end, both couples are in the top 1% of all tax payers, the McCains in the top one tenth of a percent.
The Bush Tax Cut
Taking a quick glance at how the McCains and Obamas fared under the Bush tax cut, we see that both families recouped a relatively large savings under Bush’s plan in 2006 — the McCains saving 4.87% and the Obamas saving 3.85% of their annual incomes, the McCains benefiting greatly from new tax breaks on dividends and capital gains. All in all, the McCains saved over $313,000 thanks to Bush, and the Obamas saved nearly $40,000. Had Bush’s tax cuts been fully phased in, the savings would have been even greater for both families.
McCain And Obama’s Tax Plans
Senators McCain and Obama have starkly different tax proposals. McCain favors making the Bush tax laws permanent, and also plans to repeal the Alternative Minimum Tax, double the dependent exemption and offer tax breaks on business income. Senator Obama looks to reverse provisions benefiting the best-off tax payers (such as himself and Senator McCain), and retain the parts that reduced taxes for middle and lower income tax payers–offering an additional tax credit for these wage earners amounting to $500 per worker.
Had McCain’s tax proposal been in place in 2006, both families would have done incredibly well–saving even more than they did under the existing Bush plan. John and Cindy McCain would have walked away with $373,429 in their pocket, while the Barack and Michelle Obama would have saved $49,392.
Under Obama’s plan, both families would have saved, but substantially less. The McCains would have enjoyed an estimated savings of $5,641, due to the lower tax rates; the Obamas registering a $6,124 savings.
A Forecast For The Future
This examination of the tax returns of these two prominent wealthy couples, the McCains and the Obamas, shows that both received substantial tax breaks under president Bush — and those tax breaks will be continued in a McCain Administration. The McCains’ returns particularly show how tax breaks on capital gains and dividends, hallmarks of McCain’s plan, benefit the wealthy far more than they possibly can for middle-income families. Such tax breaks, of course, have a cost in lost public investments for the present and the future — investments which could benefit everyone, rich, poor, or in the middle.
Today, the New York Times reported that large Western Oil companies, including Exxon Mobil, Shell, Total, BP and Chevron, are in talks with Iraq’s Oil Ministry for “no-bid contracts to service Iraq’s largest fields.”
Two of these companies, Exxon Mobil and Chevron, are incorporated in the United States and would save $1.7 billion in corporate taxes under McCain’s proposed cuts to the corporate tax rate, according to a recent report from the Center for American Progress Action Fund.
These companies would likely save additional millions from McCain’s proposed loophole for corporate expensing.
McCain’s campaign has at least 22 former oil lobbyists as advisers and fundraisers, at least ten of whom (by our count) lobbied for the companies now set to win no-bid Iraqi oil contracts.
The campaign has also enjoyed a recent influx of money from Big Oil, with 74% of his lifetime contributions from oil and gas companies since he announced his candidacy for president in 2008.
The contracts for Iraqi oil currently under negotiation are for 1-2 year terms, but they are reportedly a “‘foothold’ in Iraq for companies striving for more lucrative, longer-term deals.” John McCain has said he would be willing to have U.S. troop presence in Iraq for “100 years,” and is open to permanent bases.
Today’s speech by President Bush calling for America to drill its way out of its energy crisis is, in the words of Sen. Harry Reid (D-NV), replete with the “failed policies of yesterday” designed to “pad the pockets of Big Oil.”
There are two central facts about fossil fuel use President Bush carefully avoided when he called on Congress to increase the supply of oil accessible to his industry cohorts:
– The United States has only 2% of the world’s proven oil reserves, but consumes 24% of the world’s oil production. There’s simply no way for us to drill our way to energy independence or eliminate what Bush calls our “addiction” to oil. [EIA 1/29/07, 6/9/08]
– The energy future Big Oil and Bush desire involves burning up the planet. The American Petroleum Institute is promoting an increase in oil demand of 45% by 2030, which would lead to global warming 8.9 to 11°F above pre-industrial levels — guaranteeing global catastrophe. Bush’s “rational, balanced” approach to global warming is in line with this scenario. [CAPAF 4/16/08, 4/25/08]
So my administration has repeatedly called on Congress to expand domestic oil production. Unfortunately, Democrats on Capitol Hill have rejected virtually every proposal — and now Americans are paying the price at the pump for this obstruction.
Congress — which was under Republican control for most of the Bush presidency — is not blocking drilling. The number of off- and on-shore drilling permits has exploded in recent years, going from 3,802 five years ago to 7,561 in 2007. Between 1999 and 2007, the number of drilling permits issued for development of public lands increased by more than 361%.
In fact, Congress and this administration have already opened the floodgates for more oil and gas drilling in the years to come. Since 2002, the number of permits issued has greatly outstripped the number of new wells drilled. In the last four years, the Bureau of Land Management has issued 28,776 permits to drill on public land; yet, in that same time, 18,954 wells were actually drilled. That means that companies have stockpiled nearly 10,000 extra permits to drill that they are not using to increase domestic production.
Furthermore, less than a quarter of offshore acreage open to drilling is being used. Only 10.5 million of the 44 million leased acres are currently producing oil or gas. Read more
A string of recentarticles on an issue in the Northern California public schools caught our attention today. The Federal Transit Administration (FTA) is threatening to cut off public bus routes that service local school districts, claiming that federal dollars designated for city transit should not be “subsidizing” school buses, harming the ability of private bus companies to compete. The students effected are from predominantly poor neighborhoods, using the buses to transport themselves to better schools than what is available around them.
In the East Bay [Oakland-area], about 30,000 schoolchildren use [public] AC Transit buses to get to and from school, paying $15 a month for discounted youth passes. While many of those trips are on regular routes used for nonschool commuters, some of them with route numbers between 600 and 699 are specially scheduled and routed to serve specific schools. Local officials fear that the change sought by the Federal Transit Administration (FTA) would ban those special routes.
The FTA, however, has proposed no method of replacing these public buses — and certainly nothing speedy enough to be enacted before the next school year. There is no guarantee that private contractors would be willing to service all areas currently covered by public routes, and there is no guarantee that the school districts would have the resources to pay the additional cost.
Congresswoman Barbara Lee (D-CA), whose district will be most affected, has voiced concern with the FTA’s mis-shapen priorities: “Instead of looking for ways to make it more difficult for kids to get to school, the FTA should be expanding transportation options for our students.”
Congresswoman Lee is right. The FTA, and the Bush Administration, need to put their money where their mouth is. At time when gas prices are through the roof, cutting access to public buses is counterproductive to ensuring students can get to school, particularly youth from less affluent neighborhoods who set to be the most hurt. (As a San Leandro High student explained, “Take this bus away, and I’ll end up in the streets and probably get into some kind of trouble.) It’s also completely contradictory to the Administration’s drive to encourage mass transit and reduction in energy use. If we’re supposed to be walking to work, carpooling in hybrids and riding the subway, then it would be interesting to hear how the removal of public buses for students furthers that goal.
Wait a minute, wait a minute, wait a minute—to support the Iraq war, Rupert Murdoch said the best thing that will come out of the Iraq war will be gasoline at $20 a barrel. Now, today, when I came here, I looked, and it was $130-something. When is Rupert going to explain why the war didn’t give us $20-a-barrel oil?
A study of U.S. crude oil expenditures as a percentage of GDP demonstrates Murdoch’s folly. Not only has the world not benefited from “cheaper oil,” but prices are now at an all time high:
Sen. John McCain (R-AZ) is heading to Texas today for a series of fundraisers with the Texas GOP elite in Dallas, San Antonio, andHouston. Wedged between the multiple money events will be a speech in Houston, which McCain has indicated will be on energy policy. Today, McCain told reporters that he will call for:
– Lifting the federal moratorium on off-shore drilling established by President George H.W. Bush,
This suite of proposals adds up to a big fat kiss to Big Oil and its conservative allies — at the expense of everyone else. Unrestrained fossil fuel use delivers obscene profits for Big Oil but is a threat to the planet. McCain’s strong talk on global warming is proving unserious — much as candidate Bush’s campaign pledge to regulate carbon dioxide in 2000 turned out to be false. At the very same press briefing, McCain backtracked from his vaunted mandatory system to reduce greenhouse gases.
Strapped for cash and surrounded by Big Oil lobbyists, McCain is now embracing Bush’s Exxon-Halliburton energy policy. Although a “megabucks” fundraiser with Midland Texas oilmen was postponed, $1.5 million in donations have already been pledged. Midland County GOP Chair Sue Brannon told the Midland Reporter-Telegram what will happen at the fundraiser: “When the 15 oilmen giving big time money meet with McCain, all we’ll ask is that he be fair.” The millions McCain is raising in Texas will be added to his impressive haul of oil industry cash this campaign season — 74 percent of his lifetime receipts:
1990 to 2008 cycle (May), Center for Responsive Politics, compiled by Center for American Progress Action Fund.
According to a Campaign Money Watch analysis of campaign finance data provided by the nonpartisan Center for Responsive Politics Center, John McCain and his leadership committee have accepted at least $1,069,854 from the oil and gas industry since 1989. Despite his mediagenic but inconstant opposition to drilling in the Arctic National Wildlife Refuge, McCain’s voting record on energy policy has been consistently friendly to Big Oil — and since his campaign for president began last year, he’s been steadfast: Read more
Campaigning yesterday in New Hampshire, Sen. John McCain (R-AZ) renewed his call for a gas tax “holiday” and angrily attacked critics who have pointed out it’s a bad policy:
If you want to call it a gimmick, fine. You know the economists? They’re the same ones that didn’t predict this housing crisis we’re now in.
McCain is now resorting to false ad hominem attacks to defend his pandering proposal. In fact, numerous progressive economists who have been prominentcritics of the gas taxholiday have also been warning for years about the housing bubble inflated by McCain’s favorite economist, Alan Greenspan:
– Joseph Stiglitz, Ph.D. in economics from Massachusetts Institute of Technology, Nobel Prize in Economics, 2001:
“Lower interest rates worked, but not so much because they boosted investment, but because they led households to refinance their mortgages, and fueled a bubble in housing prices. In short, as Greenspan departs, he leaves behind an American economy burdened with high household and government debt and fragile balance sheets – a legacy that is already contributing to global financial instability.” [Pakistan Daily Times, 11/11/05]
– Paul Krugman, Ph. D. in economics from Massachusetts Institute of Technology:
“In spite of record home prices, housing in most of America remains surprisingly affordable, thanks to low interest rates. That fact may seem to say that there’s no housing bubble. But it doesn’t.” [NYT, 1/2/06]
– Duncan Black, Ph.D. in economics from Brown University:
“As I’ve said a few times, while I’ve long thought that the housing bubble was indeed a bubble and I knew that people were taking out really stupid mortgages that would come back and bite them in the ass, I really had no idea that lending standards had gotten so bad. . . And this illustrates that this isn’t just a “subprime” problem. Million+ mortgages aren’t subprime. [Eschaton, 11/25/07]
“We’re at the top of a housing bubble (it may not pop, but I can’t see it continuing to rise), so it’s generally cheaper to rent in these areas than to buy.” [Eschaton, 4/24/05]
– Dean Baker, Ph.D. in economics from the University of Michigan:
“We can design a mechanism that will directly benefit millions of moderate income homeowners who are struggling to hang on to their homes. Or, we can come up with schemes that will benefit the banks and hedge funds who speculated in mortgage debt.” [TPMCafé, 8/19/07]
“When the housing bubble bursts, we will see the loss of $5 trillion in housing bubble wealth…. The economic fallout will also be enormous.” [MaxSpeak, 8/3/05]
“In the absence of any other credible theory, the only plausible explanation for the sudden surge in home prices is the existence of a housing bubble. This means that a major factor driving housing sales is the expectation that housing prices will be higher in the future. While this process can sustain rising prices for a period of time, it must eventually come to an end.” [CEPR, 8/02]
Or Senator McCain could just have read Think Progress:
“Sen. John McCain’s (R-AZ) ‘pandering’ proposal for a ‘gas tax holiday’ is smart politics but bad policy.” [Think Progress Wonk Room, 4/18/08]
“Home ownership in America may be up today, but in a nasty flip side to that coin, foreclosures are also on the rise, forcing Americans into financial disaster. . . First, skyrocketing costs across the board — health care, education, retirement – combined with lower wages are leaving many Americans in financially precarious positions. . . Second, blame predatory lenders. Just like credit card companies, which make their big bucks by aggressively marketing their products to high-risk consumers– such as college students, low wage workers and the newly bankrupt, mortgage brokers and banks have been marketing riskier ways for Americans to buy homes.” [Think Progress, 5/31/05]
The Wonk Room is always looking for new and interesting studies, and luckily a paper by the non-partisan Tax Policy Center fell into our laps. The report compares the tax plans of both 2008 presidential candidates and shows precisely who will benefit under the proposals put forth by Senators Obama and McCain. Here is a chart from the report:
And here is what it means:
Increases (after-tax) income for poorest taxpayers 5.5%
No benefit for poorest taxpayers
Increases (after-tax) income for middle taxpayers
Modestly increases (after tax) income for middle taxpayers
Increases taxes for top richest 1% of taxpayers
Increases (after-tax) income for richest taxpayers 3.4%
Essentially, the Tax Policy Center shows what wealreadyknow–Obama’s tax plan provides the heaviest benefits to the poorest Americans — the ones who need the most help — while McCain’s heavily favors the richest. And while McCain’s plan provides only a nominal benefit to the middle class, Obama’s gives solid middle class relief.