JOHN MCCAIN acknowledged that he didn't know much about economics a few weeks ago, and this shortcoming manifested itself yesterday when he unveiled his fiscal platform. But he does know something about Republican politics. McCain stuck closely to the ideology of the party when he proposed tax cuts that belied his reputation for fiscal responsibility.
The most dramatic plank was a call for a suspension of the 18.4-cent-a-gallon federal tax on gasoline from Memorial Day to Labor Day this year. Not even the inveterate tax cutter George Bush has the nerve to propose that one. How else is the money supposed to be raised to repair the interstate highways? Congress should let this bad idea fade into the autumn without a hearing.
The gasoline tax idea seems devised for sound bites. The substance of McCain's plan, which depends on his election as president and a compliant Congress, is far more dangerous. Earlier in the campaign, he endorsed an extension of Bush's tax cuts and yesterday added several more: a cut in the business tax rate, a phase-out of the alternative minimum tax, doubling the exemption for dependents, and a permanent credit for research and development.
To compensate for the cuts, McCain would freeze all discretionary spending, except for the military and veterans, and eliminate all the pork-barrel items he has crusaded against for years. He's got a point about the wastefulness of these congressional earmarks, but they totaled perhaps $20 billion last year and their elimination won't go far to defray the tax cuts. And the freeze on discretionary spending would harm important federal programs ranging from Food Stamps and Head Start to the national parks. McCain would cut sinew along with the fat.
Discretionary spending excludes Medicare and Social Security, where funding levels are mandatory. McCain promised to reform and protect these programs but did not go into details. He and Congress would need new money to cushion the changes in both programs, but that would be unavailable because of tax cuts and the continued US involvement in Iraq that he favors. Under a McCain presidency, the national debt would soar as it has under Bush.
McCain raised a valid point yesterday when he criticized Barack Obama and Hillary Clinton for "embracing the false promise of protectionism." Their one-dimensional criticisms of free-trade slight its benefits for the US economy. But McCain is guilty of greater deceit - that a president and Congress can sustain the government with endless tax cuts, deficit spending, and false savings.
