Bronco_Beerslug
04-21-2008, 06:58 AM
Sounds pretty much like Bushspeak to me.
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McCain's $3.3 Trillion Tax Cut, Budget Pledge at Odds (http://news.yahoo.com/s/bloomberg/20080418/pl_bloomberg/a72l7_aj5p9c;_ylt=Alr2bI6ELb6Ckt5TOxSxOUMGw_IE)
Ryan J. Donmoyer and Indira Lakshmanan
April 18 (Bloomberg) -- John McCain's plan to cut taxes and balance the budget wins praise from fellow Republicans. Economists and nonpartisan analysts say his numbers don't add up.
McCain's proposal, outlined April 15, would extend President George W. Bush's tax cuts, reduce the top corporate rate, repeal the alternative minimum tax and double exemptions for dependents. Price: $3.3 trillion by the end of a President McCain's second term in 2017, according to figures from his campaign and the Treasury.
The Arizona senator said that would be offset by eliminating pork-barrel spending, freezing a portion of the budget, and saving from Medicare spending. He could cut the budget by $100 billion a year ``in a New York minute,'' he said in a Bloomberg Television interview yesterday.
Robert Bixby, executive director of the Washington-based Concord Coalition, a nonpartisan group that advocates budget restraint, said ``the huge imbalance'' in McCain's plan ``is that the tax cuts are specific and large and the spending cuts are small and vague.''
Once, McCain was a deficit hawk, Bixby said, but ``strange things happen when people run for president.''
Tax Cuts
Extending Bush's tax cuts would cost $1.5 trillion through the end of a hypothetical second McCain term, according to Treasury Department figures. His proposal to reduce the corporate tax rate to 25 percent would cost $100 billion a year, McCain's campaign estimates. Doubling the exemption for dependents to $7,000 a year would cost another $65 billion annually and the AMT repeal adds another $60 billion a year, his campaign said.
McCain released tax returns today that showed he paid $5,413 in AMT in 2007 and $6,979 in 2006.
McCain's spending cuts, combined with increased revenue from economic growth, total $1.5 trillion over eight years, leaving a $1.8 trillion net increase to the national debt.
``This is really a massive increase in the deficit,'' said Joel Slemrod, an economist specializing in tax policy at the University of Michigan.
Two Washington research groups said McCain's plan would cost more. The Center on Budget and Policy Priorities estimated his tax cuts would total $5 trillion over a two-term presidency. The Tax Policy Center, run jointly by the Brookings Institution and Urban Institute, said they would cost at least $5.7 trillion.
McCain senior economic adviser Douglas Holtz-Eakin dismissed such estimates as ``fantasy-land budgeting.'' McCain's proposals, Holtz-Eakin said, would balance tax and spending cuts to meet his balanced-budget goals.
Romney's Reaction
``The numbers add up,'' former Republican presidential candidate Mitt Romney said in an interview.
In an interview today on Bloomberg Television's ``Political Capital with Al Hunt,'' McCain said budget slashing is essential because ``we Republicans presided over the largest increase in the size of government since the Great Society,'' referring to a series of government entitlements, including Medicare, that were enacted in the 1960s.
To help pay for the tax cuts, Holtz-Eakin said he would save $30 billion a year by eliminating so-called ``rifle shot'' provisions. Those include items such as tax breaks for small insurance companies.
A Treasury Department report Holtz-Eakin cited as the source of his estimate states $27 billion could be raised by eliminating narrowly used tax preferences spread over a decade, not a single year.
The Discrepancy
When asked about the discrepancy, Holtz-Eakin replied that McCain would start with those provisions and target others like them to recover $30 billion annually.
Len Burman, director of the Tax Policy Center and a former Clinton administration Treasury official, said that is unrealistic. ``We looked for loopholes when I was there and couldn't even come up with $10 billion a year,'' he said.
McCain, 71, said he would offset the costs of lower corporate tax rates by freezing spending growth for a year on items unrelated to defense, veterans or entitlement programs like Medicare. So-called discretionary spending, which includes programs such as medical research and space exploration, makes up 18 percent of the budget. McCain said the freeze would save $15 billion.
There's a precedent. Former President Jimmy Carter attempted to implement ``zero-based budgeting'' that would have forced each agency to undergo an annual review and start from scratch. The idea ``didn't really work,'' Bixby said.
CONT.
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McCain's $3.3 Trillion Tax Cut, Budget Pledge at Odds (http://news.yahoo.com/s/bloomberg/20080418/pl_bloomberg/a72l7_aj5p9c;_ylt=Alr2bI6ELb6Ckt5TOxSxOUMGw_IE)
Ryan J. Donmoyer and Indira Lakshmanan
April 18 (Bloomberg) -- John McCain's plan to cut taxes and balance the budget wins praise from fellow Republicans. Economists and nonpartisan analysts say his numbers don't add up.
McCain's proposal, outlined April 15, would extend President George W. Bush's tax cuts, reduce the top corporate rate, repeal the alternative minimum tax and double exemptions for dependents. Price: $3.3 trillion by the end of a President McCain's second term in 2017, according to figures from his campaign and the Treasury.
The Arizona senator said that would be offset by eliminating pork-barrel spending, freezing a portion of the budget, and saving from Medicare spending. He could cut the budget by $100 billion a year ``in a New York minute,'' he said in a Bloomberg Television interview yesterday.
Robert Bixby, executive director of the Washington-based Concord Coalition, a nonpartisan group that advocates budget restraint, said ``the huge imbalance'' in McCain's plan ``is that the tax cuts are specific and large and the spending cuts are small and vague.''
Once, McCain was a deficit hawk, Bixby said, but ``strange things happen when people run for president.''
Tax Cuts
Extending Bush's tax cuts would cost $1.5 trillion through the end of a hypothetical second McCain term, according to Treasury Department figures. His proposal to reduce the corporate tax rate to 25 percent would cost $100 billion a year, McCain's campaign estimates. Doubling the exemption for dependents to $7,000 a year would cost another $65 billion annually and the AMT repeal adds another $60 billion a year, his campaign said.
McCain released tax returns today that showed he paid $5,413 in AMT in 2007 and $6,979 in 2006.
McCain's spending cuts, combined with increased revenue from economic growth, total $1.5 trillion over eight years, leaving a $1.8 trillion net increase to the national debt.
``This is really a massive increase in the deficit,'' said Joel Slemrod, an economist specializing in tax policy at the University of Michigan.
Two Washington research groups said McCain's plan would cost more. The Center on Budget and Policy Priorities estimated his tax cuts would total $5 trillion over a two-term presidency. The Tax Policy Center, run jointly by the Brookings Institution and Urban Institute, said they would cost at least $5.7 trillion.
McCain senior economic adviser Douglas Holtz-Eakin dismissed such estimates as ``fantasy-land budgeting.'' McCain's proposals, Holtz-Eakin said, would balance tax and spending cuts to meet his balanced-budget goals.
Romney's Reaction
``The numbers add up,'' former Republican presidential candidate Mitt Romney said in an interview.
In an interview today on Bloomberg Television's ``Political Capital with Al Hunt,'' McCain said budget slashing is essential because ``we Republicans presided over the largest increase in the size of government since the Great Society,'' referring to a series of government entitlements, including Medicare, that were enacted in the 1960s.
To help pay for the tax cuts, Holtz-Eakin said he would save $30 billion a year by eliminating so-called ``rifle shot'' provisions. Those include items such as tax breaks for small insurance companies.
A Treasury Department report Holtz-Eakin cited as the source of his estimate states $27 billion could be raised by eliminating narrowly used tax preferences spread over a decade, not a single year.
The Discrepancy
When asked about the discrepancy, Holtz-Eakin replied that McCain would start with those provisions and target others like them to recover $30 billion annually.
Len Burman, director of the Tax Policy Center and a former Clinton administration Treasury official, said that is unrealistic. ``We looked for loopholes when I was there and couldn't even come up with $10 billion a year,'' he said.
McCain, 71, said he would offset the costs of lower corporate tax rates by freezing spending growth for a year on items unrelated to defense, veterans or entitlement programs like Medicare. So-called discretionary spending, which includes programs such as medical research and space exploration, makes up 18 percent of the budget. McCain said the freeze would save $15 billion.
There's a precedent. Former President Jimmy Carter attempted to implement ``zero-based budgeting'' that would have forced each agency to undergo an annual review and start from scratch. The idea ``didn't really work,'' Bixby said.
CONT.