Ambinder has excerpts of McCain's big economic speech today. This part really caught my eye:
--Major tax reform. The broad sketch: "When this reform is enacted, all who wish to file under the current system could still do so. And everyone else could choose a vastly less complicated system with two tax rates and a generous standard deduction." No specifics yet given.
I can't find the stats right now, but the last time I looked this up, I learned that roughly 3/4 of all taxpayers file using either the 1040A or 1040EZ. The EZ is incredibly simple, and the A won't take most people more than an afternoon to complete. As a result, for most Americans the tax code already is fairly simple. Tax simplification is really only an issue for business owners and wealthy families, and that's why it almost never gets political traction. McCain and his fellow elites (both Republican and Democratic) would never know this of course, because all of them are in fact quite well off. But for most Americans, the issue of complexity really isn't an issue.
And that's why flat tax proponents have switched to calling it a "fair tax." Because although complexity isn't an issue, fairness certainly is. Most Americans hate taxes, and they do whatever they can to get out of paying them. Because rich folks have more resources, most Americans believe that the rich often use those resources to avoid paying their "fair share" of taxes. And that's where the fairness framework becomes so powerful. If you can convince people that the complexity of the system allows people to game the system to avoid paying their fair share, you can convince them that a simpler system would also be a fairer one.
The problem, of course, is that simplicity doesn't necessarily mean fairness. The devil is always in the details. A simplified system could obviously be structured in a wide variety of ways, many of which would reduce the tax burden on the rich at the expense of those in the middle.
My point? Complexity is a dodge. Pay attention to the details. And as is so often the case with McCain, there are no details. What a wonderful way to run a campaign!
Another point from his speech:
-- McCain promises to veto every spending bill containing earmarks (this is not new, but it is now an official campaign promise). Same thing with his vow to cut the corporate tax from 35% to 25%. He also proposes to increase the dependent deduction from $3500 to $7500.
He's also apparently promising a balanced budget by 2012, a one-year freeze on discretionary spending, a suspension of gas taxes during the summertime, and a permanent extension of all of the Bush tax cuts. No mention yet of purple unicorns, spaghetti monsters, and magical ponies, but I'm sure they will be forthcoming soon.
This would all be a joke if it weren't so serious.
One more point, this time taken directly from McCain's speech:
In our free society, it is left to each one of us to make our own way in the world - and our jobs, businesses, savings, pensions, farms, and homes are the work of years. Take these away and you are diminishing a lot more than the GDP, or the final tally on the Big Board on Wall Street. Take these away, and a million dreams are undone. The gains of hard work and sacrifice are lost. And something can be lost that is very crucial in our economy, and very slow to return - confidence.
Sometimes I wonder who McCain has working on his campaign team. Consumer confidence is plummeting. Bankruptcies are on the rise. The price of oil is soaring, as is the price of food. And last but certainly not least, 81% of Americans say the country is on the wrong track. And McCain is worried that government overreach might lead one day to a loss of confidence? Really?
Conservative frames have dominated our economic debates since the early 1980s. For literally decades, we've been told that government is always the problem and markets are always the solution. In 1994, the Republican Revolution swept into Congress with a promise of smaller government, lower taxes, and endless economic growth. In 2000 they won the White House, too, clearing the way for them to make all of their promises come true. Except, well... we all know how that turned out, don't we? And despite all that, McCain honestly thinks that the same old ideas and the same old arguments are going to appeal to people this year? I don't know what scares me more - that he could be that out of touch, that cynical, or that clueless. Whichever it is, it isn't good.
It's relaly quite simple. What McCain proposes is more of the same. If you like what you've been given these past 8 years, by all means vote for the man. But if you want things to head in a different direction, I don't see how you could even consider giving the man your vote. Haven't you had enough of this already?
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