The Econmy: Where they stand

[BoutDone]

Obama:
http://www.barackobama.com/issues/ec...cyFullPlan.pdf

McCain:
John McCain 2008 - John McCain for President

Their official stances.

[BoutDone]

Guess we need to add to add this link to Obama's plans.

http://www.barackobama.com/issues/fi...icy_Fiscal.pdf

I was wondering why he never mentioned his plans for dramatically raising taxes in his Economy plan.

[Htown Harry]

This report by the non-partisan Urban Institute zooms in on the tax aspects of the candidates' plans (39 pages of detail):

http://www.urban.org/UploadedPDF/411...teTaxPlans.pdf

Excerpts:

III. Economic Analysis

There is some common ground between the two plans. Both candidates agree that the elements of the 2001 and 2003 tax cuts primarily affecting those with incomes below $250,000 should be extended, that the estate tax should be substantially reduced but not repealed, and that the research credit should be made permanent (though Senator McCain would change the formula by which it is calculated). Both candidates would continue to limit the number of taxpayers affected by the AMT but would not repeal it.

However, the differences between the candidates’ plans are large. For one thing, both have a back-to-the-future look to them—McCain continues major themes of the Bush administration (lower marginal tax rates, low taxes on capital) while Obama follows the Clinton administration approach of expanding targeted tax breaks for social policy objectives and introducing new tax breaks.


C. Comparison of Budgetary Effects

Under either Senator Obama’s or Senator McCain’s plan, however, the debt would likely continue to rise as it has over the past eight years, even under the CBO’s relatively optimistic assumptions about spending.

Senator Obama’s plan would add $3.3 trillion to the national debt (including additional interest costs) while Senator McCain’s plan would add $4.3 trillion.

This does not include the cost of expanding health insurance coverage and assumes that Senator McCain’s proposals phase in and phase out on schedule. It also assumes that all of the candidates’ optimistic revenue offsets materialize. If any of these assumptions turned out to be unwarranted, the national debt would grow even more.


C. Comparison of the Two Plans [Distributional Effects]

If enacted, the Obama and McCain tax plans would have radically different effects on the distribution of tax burdens in the United States.

The Obama tax plan would make the tax system significantly more progressive by providing large tax breaks to those at the bottom of the income scale and raising taxes significantly on upper-income earners.

The McCain tax plan would make the tax system more regressive, even compared with a system in which the 2001–06 tax cuts are made permanent. It would do so by providing relatively little tax relief to those at the bottom of the income scale while providing huge tax cuts to households at the very top of the income distribution.

My take: both plans (especially the areas where they choose to have differences) are tailor-made for sound-bite politics, not good government. Not surprising...

[clifp]

Originally Posted by Htown Harry

This report by the non-partisan Urban Institute zooms in on the tax aspects of the candidates' plans (39 pages of detail):

[rant on]
Lets see the analysis was done by the Urban institute (cause we all know that urban centers in the US are filled with conservatives) and the Brookings Institute aka the retirement home for Democratic politician and liberal academics. (I suppose liberal and academic is a tad redundant).

I don't mind people quoting studies from think tanks, some good analysis comes from these places. What I strenuously object to is labeling conservative institute right wing, Neo Con, reactionary, while labeling liberal institutes as non-partisan. Of the 11 senior fellows at the Urban institute only two served in government under a Republican administration.
[rant off]

For those commenting on election, be careful before calling an organization non-partisan. 90% of institutes are anything but non-partisan. For the most part conservative think tanks are least honest enough not to claim they are non partisan.

[Htown Harry]

Easy now, clifp...

Fair enough on your critique of the Urban Institute's use of the "non-partisan" label, but you need to know that I merely copied "non-partisan" from the home page of their web site. It's their label, not mine. Perhaps it was unnecessary to add that in...

In any case, it's about the data for me, which in this case appears to have depth and substance. The paper sticks to the numbers and the effects of the candidates' policies within the tax arena. By and large, the authors seem to let the chips fall where they may. The language is non-judgmental; neither candidate is said to have a "better" plan.

So here's a friendly challenge. I agree that openly partisan think tanks can provide useful and thought-provoking analysis. Perhaps there are similarly detailed analyses of the candidates' tax proposals prepared by two polar opposite "institutes". Care to make it a weekend project with me to find them and compare notes?

[Htown Harry]

Originally Posted by Htown Harry

So here's a friendly challenge. I agree that openly partisan think tanks can provide useful and thought-provoking analysis. Perhaps there are similarly detailed analyses of the candidates' tax proposals prepared by two polar opposite "institutes". Care to make it a weekend project with me to find them and compare notes?

Challenge cancelled...for now. Several hours of web surfing confirmed the TPC study is the first one to crunch the numbers in detail, then show their work.

Much of the material I found was either derivative of TPC's work or was a breathless blog-type "analysis" peppered with rhetorical questions referring to the disaster of electing one candidate or the other.

Generally, McCain's plan is not getting nearly as much scrutiny. Much of what I was able to find in the way of conservative analysis of the tax proposals focused only on Obama's plan.

As an example, I did find this pretty solid, albeit one-sided, report from the "right-center" Tax Foundation:

The Tax Foundation - First Hard Numbers on Obama Tax Plan Show Dramatic Tax Redistribution

Senator Obama's tax plan is a dramatic redistribution of the nation's tax burden, according to a new Tax Foundation analysis.

In Tax Foundation Fiscal Fact, No. 132, Tax Foundation president Scott Hodge uses revenue estimates from the Tax Policy Center to show that Obama's plan would greatly accelerate the decades-long trend toward a federal government that depends for tax revenue almost exclusively on a few high-income people. This contrasts starkly with the McCain plan, according to Hodge, which would give every taxpayer a cut and leave the current tax burden distribution approximately where it is.

"Under the Obama plan for 2009," explains Hodge, "more than $131 billion would be shifted from the tax burden of all low-, middle- and high-income taxpayers to the burden of the highest-earning 1 percent."

The effort was not in vain, however. I found this blog entry that I'm fairly certain everyone can agree on:

Tax Update Blog: TAX POLICY CENTER OUTLINES CANDIDATE PLANS

The center-left Tax Policy Center has produced an analysis of the Obama and McCain tax plans. The TPC Blog, TaxVox, summarizes:

In the first detailed analysis of the Barack Obama and John McCain tax plans, the Tax Policy Center has run their proposals through the Big Computer and discovered that their schemes are, well, painfully predictable. Each would raise the national debt by trillions of dollars. Obama would use the money to provide modest tax cuts to low- and moderate-income people while imposing stiff tax hikes on the very wealthy. McCain would cut taxes a bit for the working-class and a lot for the rich.

The only comfort is that they are both politicians, so there's a good chance they are lying.

[clifp]

Ok, I'm done with my rant, and sorry for shooting the messenger, but it has been a pet peeve of mine for years.

I did look at the Tax policy stuff and I agree it appears at first glance reasonably fair. Considering how little of candidate stuff actually gets passed by Congress and signed into law, I think I'll skip analysis of anything until after the election. I spent a lot of time over the years looking at tax proposals. I've be reasonably non partisan about the plans, for instance I caught the right make outrageous claim about how the estate tax wipes out family farms. (The actual number farm severely impacted by the estate tax is less than a few dozen over a decade.) The left making equally distort claims about who benefits from eliminating it for the rather simple reason that if a billionaire dies we don't know if he left 500 million to his two kids or $100,000 each to his 10, 000 employees.

But keep posting good stuff, I may get inspired to dig deeper later.

[samclem]

- In my experience, it's very difficult to find a well-done analysis of tax proposed tax policies. 90% of them assume a static, "non-reacting" tax base, when in fact people will adjust their finances to reduce their tax burden. For example, most analyses of changes in the cap gains rate don't factor in the fact that people will buy/sell appreciated assets at different rates if the taxes are higher/lower, or they'll move them into tax-sheltered accounts. And these analyses seldom take into account the second-order effects (e.g. opportunity cost to society of having investment $$ tied up in tax-favored areas rather than where the market would drive them, etc). I think al of this is too hard to do, and such an invitation to "spinning" the results in one way or another that it just doesn't get done--well.

- The studies almost always focus on who wins or loses from the present tax code (the evil rich, the "working" class, the oppressed poor, etc). It's more important to know what/how various types of income/activities are being taxed. This gets us away from class warfare, and toward a useful discussion of activities we are trying to encourage/discourage through our tax policies. All taxes encourage/discourage various behaviors, so let's get that out in the open.

[Htown Harry]

Originally Posted by Htown Harry

The only comfort is that they are both politicians, so there's a good chance they are lying.

Right on schedule...

http://www.nytimes.com/2008/08/16/us...us&oref=slogin

New York Times: Obama Camp Puts Forward More Modest Tax Changes

"Senator Barack Obama appears to be altering his proposals for extending Social Security payroll taxes and raising the capital gains tax, by delaying the increases or scaling them back.

Mr. Obama, the presumptive Democratic nominee for president, has not abandoned either his support for a higher tax rate on capital gains or his proposal to subject individual wages above $250,000 to the Social Security payroll tax. But recent statements by campaign aides suggested that the latest iterations of the plans are more modest.

On Thursday, for example, Mr. Obama’s chief economic adviser, Jason Furman, said that the Social Security payroll tax extension favored by Mr. Obama would only go into effect in a decade, after he had left office...."

Mr. McCain, you're next.

[Texarkandy]

Originally Posted by Htown Harry

Right on schedule...

http://www.nytimes.com/2008/08/16/us...us&oref=slogin

New York Times: Obama Camp Puts Forward More Modest Tax Changes

"Senator Barack Obama appears to be altering his proposals for extending Social Security payroll taxes and raising the capital gains tax, by delaying the increases or scaling them back.

Mr. Obama, the presumptive Democratic nominee for president, has not abandoned either his support for a higher tax rate on capital gains or his proposal to subject individual wages above $250,000 to the Social Security payroll tax. But recent statements by campaign aides suggested that the latest iterations of the plans are more modest.

On Thursday, for example, Mr. Obama’s chief economic adviser, Jason Furman, said that the Social Security payroll tax extension favored by Mr. Obama would only go into effect in a decade, after he had left office...."

Mr. McCain, you're next.

And Mr Obama will continue to shift/modify his positions according to whichever particular demographic he feels he needs to pander to elevate himself in the polls. As will Mr McCain (though to a lesser degree IMO)

The question is what will happen if/when elected?

What political debts will be owed to what constituencies. And which ones of those will be shrugged off after the election is achieved. Which policies are actually achievable through Congress & the various interest groups that will influence legislation during that President's term. And what is the new President's true/core beliefs. The last of these is the only one it seems to me we can truly try to "divine" & base our votes upon.