Thursday, October 30, 2008

McCain/Obama Tax Plans

They actually do have some proposals.

Both plans, on balance, reduce federal taxes, demonstrating a clear and encouraging understanding by the candidates that income taxes are too high. McCain proposes $300 million more in tax cuts over 10 years. Unfortunately, Obama proposes additional tax increases -- but conveniently delays their implementation until at least two years after a hypothetical second term...

Oh, really? That's not taking into account the Magical-Disappearing-Tax-Credit "reduction" of the O-and-Con-Man...


Among the major differences, the most important is that McCain's proposals emphasize creating jobs and raising wages.

This distinction is most apparent in the Republican nominee’s proposal to extend all the 2001 and 2003 reductions in tax rates and his proposals to cut the corporate tax rate from 35 percent -- second highest in the industrialized world -- to 25 percent. The distinction is also apparent in McCain’s proposal to allow immediate expensing of business investment necessary for job growth and international competitiveness.

McCain finesses the "fair trade" issue by addressing one of the causes: tax rates. Business in PRChina do not pay taxes; matter of fact, they are heavily subsidized for exporting products. It's mercantilism pure. McCain's answer: a little-bitty teeny-tiny counter-fire exercise.

Beats the hell out of Obama's plan:

Obama's preference for punitive redistributionism is also seen in his proposal to raise tax rates on capital gains and dividends. Capital formation is essential for increasing workers’ productivity and wages. Taxes on capital gains and dividends are direct and certain impediments to business investment.

Given the problems with capital in the last few months (it disappears from Banks pretty quickly, no?) this "capital formation" thing is extremely significant. Running a business on borrowed money doesn't work for long, particularly in thin-margin industries--that is, in competitive businesses.

Like jobs? Like having an income?

Think carefully about long-term prospects.

No comments: