Candidates trade hits on taxes and spending

Republicans ramped up their assault today on Barack Obama as a tax-and-spend liberal.

On the tax side, John McCain's campaign unveiled a new web ad that features running mate Sarah Palin. "How are you going to be better off if our opponent adds a massive tax burden to the American economy?" the spot shows Palin saying.

"Good question," the announcer says.

"The Democratic nominee for president supports plans to raise income taxes, and raise payroll taxes, and raise investment income taxes," Palin continues. "How are you going to be better off if our opponent adds a massive tax burden to the American economy?"

"The answer: we won't," the announcer concludes.

Obama does support ending President Bush's income tax cuts for the wealthiest taxpayers, to raise the top tax rate on capital gains, and to levy further Social Security taxes on wealthier taxpayers.

But the ad, as has been par for the course in such attacks, does not acknowledge that the vast majority of Americans would pay lower taxes under Obama's plans because he wants to cut taxes for those who make less than $250,000 a year.

On the spend side, the Republican National Committee launched an “Obama Spend-O-Meter,” asserting that his spending promises total $1.2 trillion.

That accounting doesn't tell the whole story. While the nonpartisan Committee for a Responsible Federal Budget estimates that Obama has promised a total of $990 billion in new spending over his first four-year term, it says he has also proposed a nearly equal amount in spending cuts, so the net cost balances out.

Obama has not curtailed his policy proposals despite the economic downturn. But he has put more stress recently on finding savings in the federal budget.

"It’s time to put an end to the runaway spending and the record deficits -- it’s not how you would run your family budget, and it must not be how Washington handles your tax dollars. It’s time to return to the fiscal responsibility and pay as you go budgeting that we had in the 1990s. Many in Congress have been fighting for these commonsense principles, and I will be a president who supports them and makes sure they succeed," he said today in Wisconsin.

Obama vowed to go through the federal budget, "page by page, line by line," and cut programs that don’t work and aren’t needed and make needed programs more efficient. He also pledged to go after corporations that avoid taxes by setting up offshore tax havens, to cut private contractors, and end no-bid contracts.

Obama's campaign retaliated this afternoon, unveiling an ad of its own painting McCain as a big spender.

"I can't wait to introduce her to the big spenders in Washington," McCain is heard saying over an image of him and his running mate Sarah Palin.

"Big spenders, like John McCain," the announcer says. "McCain’s tax plan means another three trillion in debt. His plan to privatize Social Security – another trillion. Tax credits sent to insurance companies, yet another trillion."

As images of neon streets in China appear, the announcer adds, So as we borrow from China to fund his spending spree, ask yourself.

"Can we afford John McCain?" the announcer concludes over an image of President Bush with his arm around McCain's shoulders.

The $3 trillion citation is from the Tax Policy Center, but the ad does not acknowledge that the center's analysis says that Obama's plans would raise the national debt by nearly as much over 10 years. Both campaigns, in fact, have disputed the numbers, saying they assume that President Bush's tax cuts will expire by the end of 2010.

The center also calculated that McCain's proposal for a $5,000 tax credit for a family that buys it own healthcare would increase the national debt by another $1.3 trillion over 10 years. But the McCain campaign says that does not include plans to cut healthcare costs.

UPDATE: Tucker Bounds, a McCain spokesman, responded to the ad: “Barack Obama is lying with impunity and now he is shamelessly accusing John McCain of being a ‘big spender’ while failing to cite a single legitimate McCain spending item – not a single new proposal or program. The truth is Barack Obama has realized that his requests for a billion dollars in pork barrel spending and his proposal for nearly a trillion dollars in new federal spending is desperately at odds with the American pocketbook. Every American voter knows that you don’t spend more when you have less, and they also know not to vote for an inexperienced politician who will say or do anything to get elected.”

Obama's campaign also launched a web video that shows a color-by-numbers critique of McCain's tax proposals. At the end, when the camera pulls back, it reveals a coloring book depiction of McCain embracing President Bush.