McCain Unveils New Economic Stimulus Proposal: Tax Cut For Millionaires

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john-mccain-tux.jpgOn Saturday night, the McCain campaign told Politico.com that it was planning to unveil “new economic plans” that included temporary tax cuts on capital gains. Politico incorrectly noted that this proposal, which benefits the wealthy, would be “aimed directly at the middle class.”

On Sunday morning, Sen. Lindsey Graham said McCain was planning “a very comprehensive approach to jump-start the economy, by allowing capital to be formed easier in America by lowering taxes.”

But by Sunday night, the McCain campaign – in a sign of “internal confusion” — was telling the New York Times that they “would not have any more proposals this week.”

On Monday, Barack Obama announced “a new economic rescue plan Monday geared toward middle-class voters.” McCain didn’t announce anything, which “caused some head scratching.”

And now, on Tuesday, McCain is unveiling his new proposals, going back to the well of tax cuts for the rich. McCain will announce plans to “cut the capital gains tax on stock profits in half, from 15 percent now on stocks held a year or longer to 7.5 percent — a $10 billion proposal.” The Wonk Room’s James Kvaal noted the impact of cutting capital gains:

Households earning less than $50,000 a year collected a mere 2.5 percent of capital gains in 2005, according to the Tax Policy Center. Families earning more than $1 million a year collected 59 percent of capital gains. Moreover, most middle-class families with capital gains hold their investments in retirement accounts shielded against capital gains taxes.

For a candidate already promising $175 billion tax cut for corporations, including $4 billion for oil companies, handing out a new tax cut for millionaires and calling it a “Pension And Family Security” plan is oddly appropriate.


Greg Sargent notes that McCain advisers are contradicting each other on the question of whether McCain had planned to introduce new economic proposals today.

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,Ambinder: “lower capital gains…… they’re not exactly essential to getting the economy going in a year in which people do not have an awful lot of capital gains, although the McCain program calls this measure an incentive to do just that.”

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,Yglesias notes that cutting the capital gains rate is a “lousy stimulus.”

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