WSJ Editorial Board Slams McCain On Taxes
By Justin Gardner | Related entries in 2008 Election, McCain, Republicans, TaxesAfter Alan posted yesterday about McCain wavering on his tax policy, I wondered how long it would take for the fiscal conservative establishment to say, “John, I think we need to have a word with you…”
Here’s how they open the editorial, and this one has to hurt…
One of the miracles of this Presidential election campaign is that John McCain still has a chance to win, notwithstanding his best attempts to kick it away. In his latest random policy improvisation, the Arizona Senator tried to give up the tax issue.
And these probably didn’t feel too good either…
Economics has never been Mr. McCain’s strong suit, but with Iraq receding as a crisis the economy is the ground where the Senator will have to fight and win. And the tax issue provides him with a potent opening, given Mr. Obama’s pledge to raise taxes on incomes, dividends and capital gains. In proposing to raise the payroll tax cap, the Democrat is to the left even of Hillary Clinton. Mr. McCain’s Sunday blunder will make that issue that much harder to exploit.Such mistakes also help explain the continued lack of enthusiasm for Mr. McCain among many conservatives. Meeting with us last December, before the primaries, he declared that “I will not agree to any tax increase,” repeating the phrase for emphasis. He did not say any tax increase with the exception of Social Security. If Mr. McCain can’t convince voters that he’s better on taxes than is a Democrat who says matter-of-factly that he wants to raise taxes, the Republican is going to lose in a rout.
And the enthusiasm gap continues to grow…
Random thought: I wonder if this makes Romney a more viable VP pick?
This entry was posted on Wednesday, July 30th, 2008 and is filed under 2008 Election, McCain, Republicans, Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
July 30th, 2008 at 10:42 am
That’s an interesting contention, that McCain can’t suggest he might raise a tax here or there, because doing so would further dampen the already weak enthusiasm for McCain on the right.
Certainly it’s true that the right’s enthusiasm is weak and would grow weaker should McCain fail to keep tax hikes off the table. But the question, really, is where the votes are. The most the unenthused right can do in response is stay home, right? Will they do so given that the effect is to elect Brack Obama? Only time will tell.
Here’s the thing, though, about taxes. No one is especially enthusiastic about them. The more taxes that get raised, the more likely any given person fears they’ll get hit, perhaps substantially or even painfully. I suspect that there must be plenty of folks who understand that increases may be necessary in some cases to deal with the coming funding gap in SS among other things. But such folks are not necessarily cheered by the prospect of electing someone who sounds eager to raise taxes in numerous instances.
As someone in the middle I am eager to see instances where each candidate suggests to me that their approach will be realistic and not ideological. That is the exact opposite of the viewpoint of partisans who are looking for their candidate to signal an unwillingness to compromise on core issues.
So I can be counted as at least one person whose vote might be gained to replace the vote of any childish republican partisan who has decided he or she has no choice but to take his or her toys and go home.
July 30th, 2008 at 11:09 am
Romney has problems too with fiscal conservatives. The Massachusetts health care plan that Mitt developed is blowing up in the state government’s face.
July 30th, 2008 at 1:27 pm
Extending the payroll tax is a no-brainer. How can anyone justify taxing lower wage earners proportionally higher than higher wage earners? What baffles me is that most of the GOP is made up of folks who make less than 100K. How did this party dupe their own people so effectively? It’s stupifying.
July 30th, 2008 at 3:03 pm
The original understanding under which SS was established called for it to be a fair deal that was good for everyone, not a form of gross income redistribution, Mike.
Republicans, of which I am NOT one, sometimes have a different way of conceptualizing fairness than democrats and liberals. And generally it’s not an unreasonable or mean-spirited view, unlike what what you suggest by using a word like “dupe.”
So republicans tend to notice that for the most part, the more you earn, the more you pay. So if you make 40k you pay way less than if you make 90k. THEN, they also notice that the taxing STOPS at a certain point, which is another thing that Republicans tend to think is good, a limit upon taxation.
Another thing which Republicans tend to notice about SS is that they could have probably done a LOT better for themselves if the money that had been contributed to SS on their behalf had simply been invested. Don’t forget that for most folks, the amount contributed is double what was taken from your check because your employer matches it by law. So Republicans would rather the current approach be discontinued. That’s why many Republicans don’t want the payroll tax increased, because they don’t WANT SS to be propped up and perpetuated.
Now many folks LOOOOVE to question the notion that you could have done better yourself. So I’;ll give you a quick example using LOW numbers to show you how much you’d get even if you weren’t that wealthy or that foresighted.
Median incomes I think are up around 50-something K, and most folks will pay SS taxes from lets say 22 to 66, which is 44 years. Total SS contributions are around 15%, and folks these days usually contribute an additional 3-15% to a supplementary fund like a 401k.
As promised, I’ll go low in my model and use an income of 40k, an additional contribution of only 5%, and a term of investment of only 35 years instead of 40-something, supposing that someone may not start until they are 30. I’ll even use a low growth rate of 7% which is well below historical and 3% lower than other estimates commonly used.
So, lets assume that someone with that fairly low income of 40k at age 30 sets aside the SS contribution plus 5%, for a total of 20% or $8000. That 8000 gets invested every year and grows at an average a growth rate of 7% and accumulates for 35 years until the person retires at 65 years old. Their nest egg? Over 1.1 million dollars.
Contrast that with getting let’s say $4000/month from SS. If you live to 90, maybe you get the better of Uncle Sam. If you die 3 months after you retire, not such a good deal. Which leads to another plus republicans see, which is that the money they saved for themselves would not be kept by the gov’t if they die at 53 or 61 or 68….
If you understand the math, there’s an extremely strong rational force to the GOP argument. Fundamentally, the disagreement between parties over SS has far less to do with intelligence (we’re getting duped!) than it has to do with differing philosophcal approaches to life.
July 31st, 2008 at 11:37 am
Kranky - I stand corrected regarding the SS. This was a bad example of the duping that I contend goes on in the Repub. party. I’ll concede that the SS disagreement is fundementally philosophocal - there is at least a rationale at the heart of the SS debate that applies to all income levels.
Better examples of Republican duping:
1. That deregulation is the equivalent of a free market, and that taxpayers (Republicans included) must bail out the industries that are trashed by the greedy and unscrupulous
2. The gun lobby’s propogandized insistance that any fair and sane reglulatory gun laws would mean the end freedom and the beginning of totalitarian opression.
3. That taxing the very rich at a lower rate than the middleclass is good because, you never know, you might be that rich, too, someday. (Refer to Warren buffet’s famous “my secretary is taxed at a greater rate than me” statement.)
4. That the wealthy carry a disproportionatley greater burden of taxation, as they claim that something like 60% of the taxes are paid by 20% of the people (the rich). They neglect to inform their base that 80% of the wealth is owned by those 20%, therefore, they are not even carrying their own weight let alone a greater share.
5. That global warming is not caused by humans, and just because big oil companies pay for sceintists to say so doesn’t mean those scientists are swayed in any way.
7. That they are “for the military” all while risking and consuming our military personnel’s lives for the purpose of controlling oil resourses, and thereby lining their own pockets.
I could go on. I believe that it is painfully obvious that the contemporary Republican party has been hijacked by a hostle bunch of rich and powerful who will do and say anything to advance thier own cause at the expense of anyone else. These people see government as something to dismantle. They act as insurgents hostile to the very government they ran for the last 8 years (or so). The results of which are all too painfully obvious to the rest of us. Recession, dead military men and women, a tarnished Amercian reputation, dead innner city kids, and a greater gap between the very rich and the very poor.
Kranky you were right about SS.