On the stump recently, both Sen. John McCain (R-AZ) and Gov. Sarah Palin (R-AK) have been calling Sen. Barack Obama’s (D-IL) economic plans “socialism” because he wants to “spread the wealth” by raising rates on the top two federal income tax brackets back to the level at which they were under President Clinton.

The Tax Policy Center noted that “sharing the wealth, as McCain puts it, is what government does.” But this hasn’t stopped the media from amplifying the McCain message by questioning if Obama’s plan amounts to socialism or even Marxism.

The most egregious example was put forth by WFTV Orlando’s Barbara West, who asked Sen, Joe Biden (D-DE) “how is Sen. Obama not being a Marxist if he intends to spread the wealth around?” But the media haven’t stopped there. Watch a compilation:

As the New Yorker pointed out yesterday, “the principle that Obama evinced, which most economists would regard as unexceptionable, can be traced to Adam Smith.” In The Wealth of Nations, Smith wrote:

It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

Furthermore, a new analysis by Citizens for Tax Justice found that only 2.5 percent of Americans would lose any of their Bush tax cuts under the Obama plan.

Not only should those in the media point out that McCain’s charge is false, but they should note that McCain also plans to redistribute wealth. He just wants to redistribute wealth to the already wealthy.

Currently, the United States’ income concentration is at its highest level since 1928. McCain, though, has embraced the Bush economic agenda, proposing to make all of the Bush tax cuts permanent. From this, the bottom 60 percent of taxpayers would only see 12 percent of the benefit. Meanwhile, the top 0.1 percent of taxpayers would see a $1 million tax cut under McCain’s plan.

As Ben Armbruster noted on ThinkProgress, “Seeing that McCain’s policies have little to offer the average American, it seems he is now forced to acquiesce to the fringe right wing talking point that Obama just might be a Marxist.” But this doesn’t mean that the media need to follow suit.

Conservatives have been desperately trying to shift responsibility for the spiraling economic crisis away from its root cause: a bankrupt governing philosophy that shreds regulations and neglects vital supervision.

But there are a few individuals more responsible than most. A new site, How Did This Happen, a joint product of the Center for American Progress Action Fund and Media Matters Action Network, has identified six villains of the crisis.

Here are two:

Former Sen. Phil Gramm (R-TX)

Gramm is a former Republican senator from Texas who now serves a vice chairman of the UBS investment bank. He served as a senior economic advisor to Sen. John McCain (R-AZ) until October when he stepped down after calling America a “nation of whiners” experiencing a “mental recession.”
While still in the Senate, Gramm shielded derivatives from financial regulatory oversight, slipping a rule into an unrelated budget bill in 2000. The unregulated credit default swap market reached a peak of $62 trillion and contributed to the collapses of Bear Stearns Cos., Lehman Brothers Holding Inc., and the American International Group Inc. in recent months.

Alan Greenspan, Federal Reserve System

As chairman of the board of governors of the Federal Reserve System, Greenspan allowed the markets to run wild without proper supervision, a radical free-market ideology exemplified by a 2005 speech when he said “private regulation generally has proved far better at constraining excessive risk-taking than has government regulation.” He resisted the farsighted recommendation of fellow Fed governor Ned Gramlich that the Fed act to prevent some abuses predatory and risky practices in subprime mortgages, such as mortgages issued without verifying the borrower’s income or ability to repay the mortgage once the introductory rate expired.

Greenspan also opposed a voluntary code of conduct for mortgage lenders. Greenspan also led efforts to exempt derivatives legislation from the oversight BY the Commodity Futures Trading Commission, despite the clear threat to the financial system posed by the near-collapse of the hedge fund Long Term Capital Management due partly to disastrous bets on derivatives.

He now regrets his deregulatory stance. Testifying before the House Government Oversight Committee on October 23rd he explained that he “made a mistake” and had “found a flaw” in his free market ideology.

Read about all six here.

Today, Rep. John Boehner (R-OH) is “preparing to unveil a major economic initiative” aimed at “economic recovery.” Based off of an earlier “alternative” to Rep. Nancy Pelosi’s stimulus package – and outlined in a memo circulated last weekend – Boehner’s plan includes tax cuts for coprorations and zeroing out the capital gains tax.

Ultimately, the plan is a mere conglomeration of ideas plucked from the conservative tax cut wishlist and won’t do what Boehner intends:

- If we cut taxes on small businesses, they’ll use the money to create jobs.

As the Wonk Room has previously noted, tax cuts do not spur business investment. Private business investment actually rose after President Clinton’s tax increases and fell after both the Reagan and Bush tax cuts. As Princeton professor Uwe E. Reinhardt wrote “I would challenge supply-siders to explain why the owners of small businesses — say, restaurants — would expand the capacity of their establishments or build new restaurants at a time when customers stay home, even if they were given a tax cut on the income from their restaurants.”

- A zero capital gains tax is the fastest way to rebuild Americans’ 401(k)s.

The benefits from a capital gains tax cut go overwhelmingly to millionaires, particularly given the current economic climate, in which “the middle class doesn’t collect capital gains, or dividends, in any material amount.” As Michael Ettlinger pointed out “benefits of capital gains tax cuts overwhelmingly go to those who own capital assets outside of retirement.” Furthermore, Ettlinger noted “a 0% capital gains rate would in fact be a disaster for the market.” “Given the uncertain times we face, it’s far more likely that a zero rate on capital gains would prompt a massive exodus from the market than a massive entry into it,” he wrote.

Boehner is also proposing a reduction in the corporate tax rate from 35 percent to 25 percent. As the Wonk Room has noted over and over, this proposal does not create jobs. A study by the Center for American Progress Action Fund found that increased corporate profits do not trickle down, and that corporations invest little in new commercial structures such as factories and office buildings.

As evidence that his plan will be well received, Boehner cites a New Models/Winston Group survey showing that “the American people overwhelmingly believe the focus of government economic policy should be economic growth and jobs, not income redistribution or ‘spreading the wealth around.’” However, according to the latest Pew Research poll, “only 25 percent of the public agrees with the centerpiece of the conservative tax program: making all of the Bush tax cuts permanent.”

Instead of presenting a bailout stimulus package economic recovery plan based on trickle-down tax cuts – much in the manner of Sen. James Inhofe (R-OK) – Boehner should take a serious look at stimulus thru infrastructure investment, an idea which is gathering widespread support and could actually help the economy recover.