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McCain shines on fiscal issues
While John McCain's speech on Iraq got all the attention, his fiscal policy speech Monday was actually more central to his case to be the Republican nominee for president. The country faces some serious fiscal issues, and McCain can make the argument that he is the most credibly committed of the major contenders to tackle them straight on.The spending culture in Washington has become corrosive, economically and politically. Federal spending is at the highest level, as percentage of national economic output, that it has been since 1996. Republicans have historically claimed to be the party of spending discipline. Their performance while in control of both the executive and legislative branches has shredded that claim. Federal spending increased under Republican control at twice the rate it did under divided government, when Republicans controlled Congress and Bill Clinton was in the White House. Moreover, earmarks soared under Republican control. Earmarks are appropriations designated by a member of Congress for a local project within his political jurisdiction. Earmarks, commonly referred to as pork, are corrosive in two ways. First, they detract attention and resources from truly national concerns. Second, once a member has his local bridge or bus stop, he is expected to vote for the overall appropriations bill, regardless of how bloated it becomes. The tendency to spend is probably endemic to the legislative branch. Certainly electing more Republicans to Congress can no longer be credibly cited as a cure. Spending discipline can only be imposed through the executive branch. However, the tendency among presidents has been to use spending to purchase congressional support for other priorities. President Bush, for example, talks a tough game on controlling spending, but has done utterly nothing concrete to bring it about. McCain has been a ceaseless and useful public scold on pork, corporate welfare and spending not related to truly national priorities. "Give me the pen," McCain said in his speech to The Economic Club of Memphis, "and I'll veto every single pork barrel bill Congress sends me." There's reason to believe he means it. The Social Security and Medicare programs as currently constituted are unsustainable. They absorb about 7 percent of economic output today. That's projected to increase to over 12 percent by 2030 and over 17 percent by 2080. Delaying reform makes reform more difficult and costly. McCain pledged to make reform a priority. He said he would offer bipartisanship, but would not hide behind the need for bipartisanship as an excuse for inaction, as the Bush administration has done. He will submit specific proposals and fight for them. Again, there is reason to believe he means it. There are two fiscal concerns about McCain. The first is his commitment to growth-oriented tax policy. In 2000, McCain ran as Concord Coalition Man. The Concord Coalition is a useful organization unfortunately hampered by the mistaken belief that the only thing that matters economically is the federal deficit. As a result, it condemns with equal scorn economically productive tax cuts and unproductive spending increases. McCain voted against the Bush tax cuts. However, he now pledges to preserve them, and to advocate additional reforms that make the tax code "simpler, fairer, flatter, more pro-growth and pro-jobs." So, he is saying the right things. The question is whether he now truly accepts the independent virtue and primacy of growth-oriented tax policy. The second concern is McCain's belief in the righteousness of federal power and authority when he is in his Rooseveltian (Teddy) mode. There is a risk that the regulatory state would grow unhealthily under McCain. Nevertheless, his proven overall commitment to fight for tough-minded fiscal reform is unmatched by his major rivals. Rudy Giuliani did some tough things as mayor of New York, but his commitment on these issues is untested. At this point, it's hard to credit Mitt Romney with commitment to anything other than that he should be president. If there is to be a case for a President McCain, it is to curb the Washingtonian spending culture and to face squarely the need to reform Social Security and Medicare. Posted by: ryuge 2007-04-18 |
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