by Seth Michaels, Jul 3, 2008

Tax cuts for corporations, coupled with tax hikes and higher health care costs for working families? That’s no way to turn around the economy and the country. Yet, it’s the likely result of John McCain’s economic agenda, according to analysts.

This week, the Center for American Progress Action Fund (CAPAF) hosted “McCain U.,” a daylong session with economists and policy analysts who say a McCain presidency would be a third Bush term.

McCain’s agenda, these experts say, is quite extreme, taking Bush’s economic theories and pushing them even further, leaving working families behind.

Among experts who know best, McCain’s economic plans are inspiring deep concern. Gene Sperling, a CAPAF senior fellow, and Jared Bernstein, an economist at the Economic Policy Institute, say McCain’s plan gives billions away to the very wealthiest, without offering help to those working families who are in dire economic straits.

Sperling says most media are ignoring the scale of McCain’s tax plans:

What’s rather stunning about McCain’s proposals, which I don’t think has been fully grasped, is their magnitude, and the magnitude of the tax relief that is devoted solely to the people at the very top.

Sperling says the media also are ignoring what a striking reversal this is from McCain’s 2001 and 2003 stances. His plan means hundreds of billions in tax cuts for the very wealthiest—taking the Bush model and pushing it even further. Sperling notes that in 2001 and 2003, McCain said that he couldn’t “in good conscience” support Bush’s tax giveaways for the highest earners, saying that they were too tilted away from working families and fiscally irresponsible.

It’s the mother of all flip-flops. I don’t think I’ve ever seen anything quite like this. Every one of his arguments against the Bush tax cuts has gotten stronger, not weaker.

The numbers tell the story, Sperling notes: More than half of McCain’s hundreds of billions in tax cuts will benefit only the top 1 percent of taxpayers—those making more than $450,000 a year. More than $175 billion in tax cuts will go directly to corporations—regardless of whether or not those corporations are investing in workers and creating jobs. Meanwhile, paying for these tax cuts will require deep cuts in programs that benefit working families.

Bernstein says McCain’s economic agenda will take current trends in economic inequality and make them worse.

It’s somewhat unfathomable to me why McCain wants to double down on the Bush economy. He’s trying very hard to distance himself, but the facts speak otherwise.

Bernstein says like Bush, McCain’s policies would have the effect of increasing economic inequality. The economic cycle of the past seven years has shown the folly of Bush’s agenda: his massively tilted tax breaks for the rich haven’t resulted in improvement in the real wages of workers. Even as productivity has grown, incomes have been stagnant and jobs are disappearing. The theory that Bush-McCain economics is based on has been thoroughly debunked by the current economic crisis.

The result of McCain’s agenda, Bernstein says, is that huge amounts of federal revenue will be transferred out of vital education, health care and retirement programs and into the pockets of the extremely wealthy.

Sperling says McCain is selling his corporate tax cuts with the same misleading rhetoric that McCain himself criticized in 2001 and 2003.

It’s a third Bush term in policy and also a third Bush term in terms of deceptive communicating with the American people. A conscious decision has been made that he will go completely with the party line.

Meanwhile, while McCain’s tax agenda would give billions to corporations and CEOs while ignoring working families, his health care agenda could wind up resulting a tax hike for those who get health benefits through their job—or the loss of insurance coverage entirely.

Karen Pollitz, a health policy analyst, says McCain’s health care plan is focused on shifting workers out of the group plans they have now and into the private insurance market. In addition, private insurers would be deregulated, so that consumers would have even fewer protections. Pollitz described McCain’s plan as tilted toward insurance companies and away from customers.

Karen Davenport, director of health policy for the Center for American Progress Action Fund, says McCain’s health care proposal could cause smaller employers to stop providing health coverage entirely, leaving workers at the mercy of the private market.

In the real world, we’ll see costs increase for families and individuals. It’s a fallacy to think that individuals are going to have the bargaining power to find affordable policies that fit their needs, and it’s a fallacy to think that individuals will be able to negotiate with hospitals. His plan, with its reliance on the individual market, would undermine preventative care and chronic disease management, and, by discouraging good consumer choices, could increase health care costs.

Pollitz says McCain’s plan would offer bad choices. Workers could get pushed out of their existing plans or, if they chose to stay, would get taxed on those benefits. By driving people out of group health plans, McCain’s proposal would destabilize the whole concept of insurance, making those plans more expensive.

The economy and the health care system must be tackled by the next president. Turning around America and making the economy work again will require listening to experts and the needs of working families. Unfortunately, what McCain has proposed so far is a continuation of the bad Bush policies that have hurt working families.

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