The Candidates
I am a bit out of the conservative mainstream in that my chief misgivings with Senator McCain are not with his ill-informed immigration policies or campaign finance presciptions (though the constitutional monstrosity that bears McCain’s name is certainly enough for a trip to the principal’s office). Rather, my biggest objection to Mr. McCain has been the preception that he would be the first nominee since Gerald Ford who doesn’t “get it” on the deleterious effect of high marginal tax rates on the U.S. economy.
Kevin Stach, writing in today’s Wall Street Journal, makes the case that supply-siders may be hasty in our condemnation of McCain’s record.
After sweeping the Potomac primary, John McCain is now the de facto Republican nominee for president. But while Mr. McCain’s fight for the nomination is all but over, Mike Huckabee’s strong showing in Virginia suggests that Mr. McCain’s battle to unify the Republican Party is just beginning. One major task is to secure the GOP’s right flank, which remains cool to Mr. McCain over issues including taxes and economics.
The support of supply-siders Jack Kemp and Phil Gramm has not been enough to reassure some economic conservatives about the direction of economic policy in a McCain administration. Yet a look at Mr. McCain’s record in Congress over the past 25 years demonstrates a tax-cutting pedigree at least as strong as, if not stronger than, Mitt Romney’s or Mike Huckabee’s (they both raised taxes as governors).
[…]
Mr. McCain took over Barry Goldwater’s Senate seat in 1987. In 1989 - in the face of rising deficits - Mr. McCain voted for a pro-growth cut in the capital-gains tax to 35% and to expand tax-advantaged Individual Retirement Accounts.
In 1990, those rising deficits led President George H.W. Bush to abandon his “no new taxes” pledge and seek out a budget deal with Senate Democrats. The negotiations were so politically sensitive that Office of Management and Budget Director Richard Darman and congressional leaders decamped to Andrews Air Force base. They ultimately brought back a deal that included a trade-off: supposedly binding budget levels in exchange for what was then the largest tax increase in history.
Many Republican budget hawks in the Senate - including Bob Dole, Pete Domenici, Warren Rudman, Alan Simpson, Strom Thurmond and Orin Hatch - strongly pushed this package. Yet Mr. McCain and other supply-siders such as Connie Mack, Trent Lott and Phil Gramm broke ranks with George H.W. Bush and the GOP leadership to vote “no.”
Anyone with the good sense to try to thwart Bush 41’s ruinous attempt to raise taxes has some economic horse sense. Stach concludes thusly:
Mr. McCain has tried to reassure economic conservatives by pledging to make permanent the tax cuts he initially opposed. Whether Mr. McCain can ultimately convince them remains to be seen, although his 25-year record of supporting pro-growth tax cuts weighs in his favor. If that’s not enough, they might consider that the Bush tax cuts are on auto-pilot to expire - and neither a President Clinton nor a President Obama will have to lift a finger to impose a crushing tax hike on America’s economy.
February 14th, 2008 at 4:05 pm
That’s an interesting point Gary. I noticed he filled out a form once where he indicated he wanted to cut taxes on all income brackets below $150,000 but he wanted to keep taxes the same on brackets above $150,000.
February 14th, 2008 at 4:08 pm
The supply-side faith is rather irrelevant when income taxes are so low (in comparison to the rest of the world) but our corporate taxes are so high.
In this era of free trade, comparisons to other nations’ tax rates are more important than static levels of certain taxes.
One thing I liked about Romney was that he got this new paradigm for tax policy.
February 14th, 2008 at 4:10 pm
Regrettably, Clarence, I fall into the latter category. And, of course, under supply-side doctrine the most important tax rate is the highest marginal rate as that is the rate at which economic activity is either encouraged or thwarted. People either choose work and investment or leisure based on what they will keep on their last dollar earned.
I think McCain has a track record that may indicate he understands that.
February 14th, 2008 at 5:29 pm
Just a word on the Romney endorsement. It looked like McCain was there for an enema. It was completely joyless. And watch McCain’s eyes while Romney is speaking - he looks down a couple times at Romney’s notes as if to see how much more he had to say. At times it looked like he was rolling his eyes. I think this is one time a video or phone call would have been better.
February 14th, 2008 at 5:55 pm
Gary — thanks. Why the heck didn’t the McCain camp produce this kind of stuff earlier???
February 14th, 2008 at 5:56 pm
Axel,
Romney just proved once and for all who was the better man. Of course McCain would hate every minute of it.
February 14th, 2008 at 6:06 pm
Call me when McCain gets serious about spending cuts.
February 14th, 2008 at 6:11 pm
To answer my own question in #5: (1) Probably nobody at the top of the campaign even gets it, and isn’t listening to Gramm and Kemp. (2) There’s no good reason why he was on the right side of things 20 years ago and flipped on these issues in recent history. (3) While most Republicans like tax cuts, few are ardent supply-siders or even understand the distinctions between what kind of tax cuts work and what kind don’t — there aren’t enough of us exerting our influence the way SoCons do.
February 14th, 2008 at 6:24 pm
We all already know McCain as a conservative Senator pre-2000. It is after 2000 that we are having a problem with his stances! He’s a great follower, but as a leader, he stinks! Once the strong conservative leaders (Newt Republicans) left, and McCain came to front as one of the leaders, we saw a different person. This article only address during the days he was a follower, nothing about his era since 2000.
February 14th, 2008 at 6:30 pm
Gary, you may not realized this, but those who makes more than 150,000 being taxed at the same rate will be those who cannot as much of their money to purchase the stocks of the American businesses. What it essentially means is that we need the foreign entities to bail us out, instead of using our own people. Those who are wealthy enough to hire their own full-time accountants will just keep the majority of their incomes off-shore (or through hedge funds). Again, we have put them out of our reach in bailing us out. We have complained about losing the ownerships of our businesses to the foreigners. This is one of a several reasons.
This is not to go into the philosophy of our Founding Fathers on how all are equal before the law.
February 14th, 2008 at 8:44 pm
“the deleterious effect of high marginal tax rates on the U.S. economy. ”
Ah yes. Trash Bush the Elder for trying to clean up Reagan’s mess (the tripling of the national debt, curesy of the wisdom of supply side).
And those terrible terrible deleterious effects that we saw throughout the nineties, curtesy of Bush Sr. and Clinton - i.e. the greatest economic expansion in our history.
February 15th, 2008 at 9:56 am
11 — Have you no concept of correlation and causation?
The Earth has been warming since Pelosi has been House Speaker!
February 15th, 2008 at 10:13 am
If you really think McCain is Serious about the Border, please read:
“”Mr. Hernandez, who now serves as one of Mr. McCain’s Hispanic Outreach Directors, is no amateur in the debate over illegal immigration into the United States. Though largely unknown to the public, he’s been at the center of the policy maelstrom for years, a critical frontline player for the proponents of open borders and an unflinching advocate for strident Mexican nationalism.
Though born in the United States to a father from Mexico and a mother from Texas, Mr. Hernandez has left no doubt as to where his loyalties lie. Serving as a cabinet member to Mexican President Vincente Fox — the first American in Mexico’s history to do so — Mr. Hernandez has tirelessly fought against assimilation in America.
In an interview with ABC’s Nightline, Mr. Hernandez said Mexican Americans must always think “Mexico first,” whether they are one generation in the United States or have been here for seven generations.
In public remarks both before and after the terror attacks of September 11, Mr. Hernandez declared that Mexicans in the United States must never surrender their loyalty to Mexico, but rather must always keep “one foot in Mexico.” Now that’s straight talk; just not the kind that Mr. McCain wants voters to hear between now and the convention, or November if he wins the nomination. So perhaps it’s not too surprising that Mr. McCain played dumb when a voter asked him about his association with Mr. Hernandez during a town hall meeting in Florida.
Questioned by a woman who recited Mr. Hernandez’s comments that illegal immigrants are forced to steal citizens’ Social Security numbers because they couldn’t find work without them — which shifts the guilt to Americans — Mr. McCain quickly went into his stock stump mantra promising border security.
“He’s on my staff because he supports my policies and my legislative proposal to secure the borders first,” Mr. McCain asserted. “I don’t know what his previous positions are or other positions are, he supports mine.” Mr. Hernandez does indeed support Mr. McCain — and that speaks volumes.
The fundamental question that American voters must ask themselves is: Why would a zealous Mexican nationalist who has dedicated much of his life to eliminating the border between Mexico and the United States now suddenly support a candidate who claims to favor securing the border once and for all? Could it be that Mr. McCain’s assertions translate a little differently to Mr. Hernandez’s ear? Indeed, that wide grin Mr. Hernandez likes to flash suggests that what he’s hearing from Mr. McCain has a familiar ring to it, perhaps not unlike that of a Tijuana police chief vowing to crack down on corruption.
The bottom line is that Mr. Hernandez is a savvy man with enough sophistication to know that what Mr. McCain is not saying is equally important — if not more — than his pablum about “border security.” And Mr. McCain is not saying he will support vigorous enforcement of our nation’s immigration laws in the interior of the country, particularly at job sites; he’s not saying that he supports deporting any significant number of illegal aliens already in the country; and he is surely not saying that he will end the chain migration laws that strike to the core of encouraging illegal immigrants to get into the nation at all costs and then wait for an amnesty that will allow them to bring their extended families north.
No, Mr. McCain is saying none of these things.
Mr. Hernandez hears the senator’s “straight talk” loud and clear, and it seems to be music to his ears.
Mark Cromer is a senior writing fellow for Californians for Population Stabilization. “”