Washington, D.C. – Today, the Hyde Park Project and the Wonk Room, the progressive policy war room of the Center for American Progress Action Fund, released a comprehensive critique of John McCain’s tax proposal entitled “Five Easy Pieces and Two Trillion Dollars”.
In 2001 and 2003, Sen. John McCain (R-AZ) opposed the Bush tax cuts, arguing that they came “at the expense of lower- and middle-income Americans” and were too costly in a time of war. As a presidential candidate, however, McCain not only embraces the Bush tax cuts but also proposes massive additional tax cuts that are even more tilted against the middle class. To assess the McCain tax proposals, the report begins by defining five key characteristics of the Bush tax cuts: they cost an enormous sum, skew benefits to the wealthy, favor capital over work, protect tax shelters, and increase federal budget deficits. The report then assess the McCain proposals against these five benchmarks. Finally, we compare both the Bush and McCain plans with the conservative tax agenda known as “Five Easy Pieces” advanced by Grover Norquist’s Americans for Tax Reform and other conservative tax groups. Our analysis suggests that the McCain plan shares five key characteristics of Bush policies:
· It is enormously expensive, costing more than $2 trillion over the next decade and essentially doubling the Bush tax cuts.
· It would predominantly benefit the most fortunate taxpayers, offering two new massive tax cuts for corporations and delivering 63 percent of its benefits to the top 1 percent of taxpayers. The Bush tax cuts provide 31 percent of their benefits to the top 1 percent of taxpayers.
· The plan continues the shift of the tax burden from investment income onto earned income.
· The plan not only fails to address current tax shelter problems in the tax code, but in fact will lead to increased sheltering.
· McCain cannot pay for his tax cuts without massive reductions in Social Security, Medicare, or other key programs that benefit the vast majority of Americans.
The report concludes that the McCain tax plan is essentially a continuation of the agenda articulated by Norquist and others to achieve piecemeal but radical changes to the U.S. tax code under the heading of “Five Easy Pieces.” These changes require huge spending cuts, shift the tax burden away from capital and onto labor, and come “at the expense of lower- and middle-income Americans.”
Read the full report (pdf)