So what exactly is in each candidates’ economic plan? Let’s begin by taking a point-by-point comparison on taxes:
McCains’ plan promises to maintain the 35% top-tier tax rate as well as the 15% capital gains rate, and phase out the Alternative Minimum Tax. Except for some verbiage about internet and cell phone taxes, the rest of the tax section of his economic plan is devoted to business. The “Relief for Families” section also reiterates April’s gas tax-holiday proposal.
Obama proposes a “Making Work Pay” tax credit of up $500 for every worker and wants to eliminate taxes on seniors earning less than $50,000. He also mentions working to simplify the tax-filing process with a system of pre-filled IRS forms that would reduce the time it takes for some people to do their taxes down to five minutes.
Perhaps the most bold of his proposals is a $1,000 Emergency Energy Rebate, funded by a windfall tax on oil companies.
Analysis: On the Obama side, the $1,000 tax credit for working families certainly seems doable. I’m not so sure about the plan to exempt seniors under $50K. The real eyebrow-raiser to me was the windfall tax on oil profits to send us all $1,000 checks. Even in our post-tax rebate economic landscape, I’m skeptical that this can get accomplished. And as much as I liked the first rebate check, I’m not sure I’d even want that, from a fiscal responsibility standpoint. It’s a slick proposal for the campaign, though, in that McCain can’t argue against it — his running mate did the same for her constituents.
As for McCain, I have to admit that my first instinct seems to have proven correct. There is a stunning lack of specific substance, at least in terms of this part of his economic plan. As far as personal taxes go, his site mentions a pledge to keep current tax levels and nothing more. I read it several times on the assumption I must have missed something, and checked other sections of his economic plan to see if there was more info.
Which is how I found the gas tax-holiday proposal. I was real surprised that this was still part of his platform considering how soundly the idea was thrashed back in the spring, and how bad an idea it is to begin with. At best, it’s gimmicky — there has to be better ways to go about tax relief. At worst, you’re rewarding the very industry that’s causing you to enact the tax holiday to begin with by making their product cheaper. Which in turn increases demand, which impacts supply, and gas prices go up and the entire tax benefit is negated.
I’m scoring this round for Obama. Not everything he wants to do can or should get done, but at least his plan as outlined for the public was substantive and clear on some degree of details. The McCain site is just maddening in that it speaks mostly in stump speech generalities. Abolishing the AMT would be wonderful, but I hear this one every year. Maybe McCain has more to offer, but all he’s saying in his plan is to keep on keeping on and he’ll get you 18-cents a gallon off your summer driving.
*Wait, I forgot one other pledge of the McCain plan, one I thought was odd. He pledges to ban all taxes on email and text messages (of which none currently exist). This is going to sound snide when I ask, and I don’t mean it to: was there risk of this happening? I think I heard this idea tossed out about five years ago and it died a quick death.