McCain calls for cuts in corporate, individual taxes
Sen. John McCain speaks yesterday in the Wiegand Gymnasium at Carnegie Mellon University.
Approximately 50 people march and chant at an AFL-CIO sponsored demonstration while Sen. John McCain speaks at a luncheon inside the Omni William Penn Hotel, Downtown, yesterday.
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Sen. John McCain yesterday provided the clearest glimpse yet of how he would manage the economy as president, brandishing a lengthy menu of tax cuts, higher prescription drug premiums for affluent recipients, a year-long moratorium on discretionary federal spending and an unusual "gas tax holiday" this summer to reduce the cost of gasoline and stimulate the faltering economy.
"The effect will be an immediate economic stimulus," he said of dropping the 18.4 cent federal gas tax and 24.4 cent diesel tax, "taking a few dollars off the price of a tank of gas every time a family, a farmer, or a trucker stops to fill up,"
In his first official appearance in Pittsburgh as the presumptive Republican presidential nominee, the Arizona senator laid out his economic agenda to a crowd of about 600 people -- mostly students -- gathered at the Wiegand Gymnasium at Carnegie Mellon University, and claimed his reforms would save up to $100 billion annually.
Stressing his longtime personal philosophy in favor of limited government and tax policies "that respect the wage-earners and job creators who make this economy run," Mr. McCain also repeatedly referred to his reputation as a crusader against pork-barrel spending and for government accountability.
He vowed to veto any Congressional earmarks that come across his desk and impose a year-long freeze on discretionary spending -- with the exception of the military budget and veterans' benefits -- while each federal program undergoes a performance review.
As he has in the past, Mr. McCain said he would oppose allowing the Bush tax cuts to expire -- even though he twice voted against them -- while noting that his Democratic opponents will "raise your taxes by thousands of dollars per year, and they have the audacity to hope you don't mind" -- a swipe at one of Sen. Barack Obama's books, "The Audacity of Hope."
"For their part, Sens. Obama and Clinton have championed a long list of pork-barrel projects for their states, like that all-important Woodstock museum that Sen. Clinton expected Americans to pay for at the cost of a million dollars. That kind of careless spending of tax dollars is not change, my friends: it's business as usual in Washington."
Those partisan broadsides were delivered on the same day Mr. McCain's campaign released a new commercial showcasing his moderate side, clearly aimed not at the GOP's conservative base but at swing voters in states such as Pennsylvania.
"As president, John McCain will take the best ideas from both parties to spur innovation, invest in people and create jobs," the 30-second spot's announcer intones.
While proposing a cut from 35 percent to 25 percent in corporate taxes, Mr. McCain also said he would provide relief for the middle class with a phase-out of the alternative minimum tax, doubling the dependent exemption from $3,500 to $7,000, and the option of a shorter, easier to use tax form.
The senator, who a few weeks ago had appeared cool to government intervention in the subprime mortgage crisis, reversed course recently and said he'd support a bailout for qualifying homeowners.
And if they qualified, they'd get "a new, 30-year fixed rate backed by the United States government. Citizens will keep their homes, lenders will keep their losses, and everyone will move on -- following the sounder practices that should have been observed in the first place."
Mr. McCain also complained that the prescription drug benefit program passed by Congress in 2003 -- over his protests -- includes too many people "who are more than capable of purchasing their own medicine without assistance from taxpayers who struggle to purchase their own."
Under a proposal outlined by his campaign advisers, couples in the Medicare Part B program who make more than $160,000 a year or individuals making more than $82,000 would be required to pay higher premiums.
Mr. McCain also called on the U.S. Department of Education to ensure that college students will continue to obtain financial aid in a tight credit market. The department should "work with the governors to make sure each state's guarantee agency has the means and manpower to meet its obligation as a lender-of-last-resort for student loans," he said.
In a clear nod to Carnegie-Mellon's reputation as a technology leader, Mr. McCain also said he'd sign a law permitting the first-year expensing of new equipment and technology, a permanent ban on Internet taxes and a ban on new cell phone taxes, "which should be of interest to people here," he said, as the audience applauded politely.
Reaction from the audience was generally positive. Josh Joll, a 17-year-old senior at Steel Valley High School in Munhall, traveled with his class to see Mr. McCain, whom he found "charismatic" and substantive -- saying he particularly liked his promise to cut government spending.
But he still hasn't decided how he'll vote.
Evan Osheroff, 21, a Carnegie Mellon student majoring in business administration, said he agrees with Mr. McCain's policies on the global economy, free trade and strengthening the dollar, while calling the senator's proposal to cut the gas tax "interesting."
Not everyone thought so.
"I think John McCain is very sincere, and he has taken some stands that aren't very popular, and I admire him for that," added Dirk Pohlers, a native of Germany and a 29-year-old graduate student at the university's Tepper School of Business. "But in some other ways he seems to just be trying to gain votes. That tax on gas during the summer months is just to make people happy but isn't going to solve any issues, and if anything could make them worse" by encouraging people to drive more.
That criticism was echoed by Tepper School of Business Economist Lester Lave, who issued a statement shortly after the speech arguing that a gas tax reduction would only promote energy consumption.
Sen. Hillary Rodham Clinton's campaign also issued a statement calling Mr. McCain's economic prescriptions "a George Bush-redux of corporate windfalls and tax cuts for the wealthy that will bankrupt our government and leave working families with the bill."
A spokesman for Mr. Obama called Mr. McCain's economic prescriptions "a gift basket of new tax cuts for corporate America at a time when some CEOs are making more in a day than some workers make in a year."
Mr. McCain then headed across the state to Villanova University in Philadelphia to appear on Chris Matthews' "Hardball" college tour, where, in response to a question from MSNBC's Mr. Matthews, he repeated earlier statements characterizing Mr. Obama's statements last week about small-town Pennsylvanians as "elitist."
"I think that the fact that they like to hunt has nothing to do with their economic conditions. I think that they respect and cherish the Second Amendment to the Constitution of the United States. ... We are a unique experiment in history and the greatest thing about America and these young people out here today and from the small towns in Pennsylvania want to continue to serve a cause greater than their self-interest."
Today, Mr. McCain continues his focus on economic policy, flying to Milwaukee to host an economic summit there with local business and government leaders.
First Published April 16, 2008 12:00 am