Tuesday, August 19, 2008

McCain Rides The Happy Talk Express On The Economy

The recent appearance of Barack Obama and John McCain at Saddleback Church, Reverend Rick Warren's evangelical megachurch in Lake Forest, California, left me reflecting not so much about what I see as an all-too-pervasive emphasis on religion in American politics, but about the candidates' stance on economic issues.

What stood out for me–and what I think has not received enough play in the media–was the answer to the question of what defines "rich"? According to an account in the New York Times (8/17/08), Obama said that American families that earn less than $150,000 a year are middle class or poor and entitled to a tax break.

During his session, McCain said that " 'rich' should mean people who are happy."

How heartwarming.

In a time of home foreclosures, higher gas prices and rising unemployment, the Republican candidate comes up with something that has the profundity of a Hallmark greeting card.

Of course, McCain had to give that answer. He would have caused an uproar among his supporters had he presented a serious definition of the word "rich." For the GOP, that term is not simple. Defining it could lead to dangerous discussions about our new gilded age, in which the wealthy have benefited tremendously by the Bush tax cuts. Of course, while piles of cash have been shoveled at millionaires and billionaires, we've spent billions on an unnecessary war (see the counter on this page), the deficit has metastasized and we've gone into deep debt to Asian banks.

The Bush tax cuts I've referred to are the very ones that John McCain wants to extend for the wealthy and major corporations, including big oil. If he were elected president, he would continue the policies which the Times protests in the editorial "The Corporate Free Ride" (8/18/08). The editorial proposes a way "...to address the United States’ gaping fiscal deficit: persuade corporate America to start paying taxes," especially since "An investigation by the Government Accountability Office found that almost two-thirds of companies in the United States usually pay no corporate income taxes. Big companies, those with more than $50 million in sales or $250 million in assets, are less likely to avoid Uncle Sam altogether. Still, about a quarter of them report no tax liability either."

Imagine what could be done for health care, education, the infrastructure, veterans' care (including the thousands that are going to need lifelong care as a result of Bush's war) and other societal needs with that money. George Bush and John McCain, however, have other priorities: "The first place to look for money to close the budget deficit should be among the high-income individuals who have been treated so generously by the Bush administration. But corporate America has been getting a free pass for far too long. And the seeming ease with which corporations escape the taxman altogether compounds a fundamental unfairness in the American economy... It is a uniquely American paradox. This country’s corporate tax rates are among the highest in the industrial world, yet the taxes that corporations pay are among the lowest. With an enormous budget deficit and pressing demands for better health care and other social programs, America can no longer afford free riders."

Despite McCain's advocacy of unpopular economic policies, Obama still isn't surging in the polls. Paul Krugman, in "It's the Economy Stupor," notes this paradox and suggests that the Obama campaign hasn't approached this issue with enough passion:

"By rights, John McCain should be getting hammered on economics.

"After all, Mr. McCain proposes continuing the policies of a president who’s had a truly dismal economic record — job growth under the current administration has been the slowest in 60 years, even slower than job growth under the first President Bush. And the public blames the White House, giving Mr. Bush spectacularly low ratings on his handling of the economy.

"...the problem isn’t lack of specifics — it’s lack of passion. When it comes to the economy, Mr. Obama’s campaign seems oddly lethargic.

"I was astonished at the flatness of the big economy speech he gave in St. Petersburg at the beginning of this month — a speech that was billed as the start of a new campaign focus on economic issues. Mr. Obama is a great orator, yet he began that speech with a litany of statistics that were probably meaningless to most listeners."

Now that we're heading into September, it's time for the Obama campaign to end McCain's silly season of Britney, Paris and tire gauges and focus the country on issues that matter, including the economy. The new ad above depicting how removed McCain has consistently been on economic issues is a step in the right direction. Obama must hit hard against GOP economic policies, sure to be continued by McCain, that have led to our economic impasse. Krugman presents Bill Clinton's victorious "It's the economy stupid" theme as a model:

"In his speech accepting the Democratic nomination in 1992, a year in which economic conditions somewhat resembled those today, Bill Clinton denounced his opponent as someone “caught in the grip of a failed economic theory.” Where Mr. Obama spoke cryptically in St. Petersburg about a “reckless few” who “game the system, as we’ve seen in this housing crisis” — I know what he meant, I think, but how many voters got it? — Mr. Clinton declared that “those who play by the rules and keep the faith have gotten the shaft, and those who cut corners and cut deals have been rewarded.” That’s the kind of hard-hitting populism that’s been absent from the Obama campaign so far."

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