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A Times Editorial

On economy, candidates are bankrupt

None of the three remaining candidates for president is being honest with voters about the economy. To the contrary, each is busy trying to outdo the others with promises of new spending programs and tax cuts (or at least no tax increases), the same formula that got us in the current mess of living beyond our means.

The biggest offender, curiously, is Republican Sen. John McCain, once known for his straight talk on behalf of fiscal responsibility. Yet if he kept all of the promises he has made so far in the campaign, he would blow a hole in the federal budget bigger than the one in the ozone.

The nonpartisan Tax Policy Center analyzed the candidates' proposals and came to this conclusion about McCain's plan: "Cuts this size would pare government back to levels not seen since the Eisenhower administration." If you think that sounds good, think again. McCain's proposed $550-billion in tax cuts "roughly equal . . . all nondefense discretionary spending," concluded Len Burman, the center's director.

So goodbye agriculture, commerce, education, energy, environment, health and justice programs, just to name a few. It's not going to happen, of course, so that means McCain would inflate the now $9-trillion national debt at least as much as President Bush did with his tax cuts and costly Iraq war.

McCain wants to cut corporate taxes on profit, eliminate the admittedly out-of-control alternative minimum tax, double the amount individual taxpayers can deduct for dependents and suspend the federal gas tax this summer, a foolish campaign ploy also favored by Sen. Hillary Clinton.

The Democrats are more restrained, though no more honest about the sacrifice needed to balance the nation's books. Clinton and Sen. Barack Obama would hold the "middle class" harmless from future tax increases, and Clinton defines that class as those having an income of less than $250,000. While a quarter-million doesn't go as far as it used to, the Tax Policy Center figured that only 3 percent of taxpayers report that much income or more.

So where would Clinton get the billions in tax revenue necessary to enact some of her ambitious spending programs, particularly universal health care? Even Obama's more frugal agenda has identified no adequate funding source, though if he could keep his promise to end the Iraq war quickly (a big if) it would cut expenditures substantially.

Both Clinton and Obama have proposed tax cuts for many families, seniors and others. They would supposedly make up the difference by raising taxes on the richest Americans, which would apparently come from that 3 percent not considered middle class. Yet even the ripest fruit yields only so much juice.

Maybe elections aren't the time for economic honesty, though they should be. Bush proved that if a candidate is allowed to get away with too many fantasies about tax cuts and spending, the dream can quickly turn to a nightmare.

On economy, candidates are bankrupt 05/03/08 [Last modified: Friday, May 9, 2008 5:33pm]
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