John McCain's Plan: Pre-Presidential nominee McCain favored tax reform. The American Prospect notes that McCain was a "tough-talking conservative who wraps himself in the Gipper's legacy, inveighs against earmarks, calls himself a deficit hawk, and fought George Bush's 2001 and 2003 tax cuts, McCain seemed to be one of the few politicians in America actually eager to restore some sense to the tax system."
However, since his nomination, his tune has completely changed. Instead of dealing with the reform issues that need to be addressed, McCain now wants to cut the corporate tax from 35% to 25%. This will cost us "$100 billion a year, but fails to eliminate a single corporate tax break." As The American Prospect points out, "the change is very valuable for companies because a $100 deduction today is worth a lot more than $10 a year for ten years. For the same reason, it is very expensive for the Treasury -- to the tune of about $75 billion a year."
It amazes me, the lies they tell. Holtz-Eakin (McCain's top financial advisor) has said that in reality, this would not cost our country a thing. But, in a similar (smaller) proposal headed by Eakin, it was concluded that it would cost our country "$440 billion over a decade."
McCain is also an advocate of immediate investment write-offs, which is a way for businesses to shield their true profits from taxation. Ridiculous. So, while the average working man has to work almost five months to be considered "free of tax," business get to shelter different aspects of themselves from taxation at all.
For the individual, and families, McCain proposes a repeal of the AMT, which was put in place to protect against tax shielding. (Double standard, what?!) He wants to increase the dependent deduction amount, which would mainly benefit the wealthier people. He's rejected tax reforms that would aid families, such as baby bonuses, and so on.
Basically, in summary, McCain's tax plan would actually cost our country about $300 billion a year, and would not even begin to touch the major reforms that are needed.
(All quotes came from the same source, cited above. Bad form, I know. But I'm in a hurry.)
Barak Obama: wishes to raise taxes specifically aimed at the wealthy, or those who make more than $250 thousand a year. One possible argument against this is that this constitutes approximately two-thirds of the taxes reported in 2006. More than likely, this would also increase taxes on small business, which as anyone knows, are the basis for stability in a capitalistic economy.
Politico reports, in the same article above, that if Obama allows the rescheduled 2011 tax raises to occur, S corporation taxes would go from 35% to 39.6%. "The sole proprietor and partner rate would rise from 37.9 percent all the way up to a staggering 50.3 percent." How will this foster business growth? When 50% of one's profits must go to paying taxes? In my opinion, this will send us into a worse recession than the one we're already faced with.
However, Obama is also in favor of reform. The Sun-Times reports from Obama's financial advisors saying, "The Obama plan would dramatically simplify taxes by consolidating existing tax credits, eliminating the need for millions of senior citizens to file tax forms, and enabling as many as 40 million middle-class filers to do their own taxes in less than five minutes and not have to hire an accountant."
He wants to repeal the estate tax and ratify the dividends tax cuts. So, that's good. I think. But, really... I don't understand how all of this stuff works. I'm just reporting what I've read, what makes sense to me... and the way I see it.
I don't think that either candidate has it all figure out, nor have the thoroughly figured into their tax plan(s) this new recession we're entering upon. And, I don't know how each plan would play out given the new financial world we're going to be dealing with.
Besides, I almost feel as though within their own separate camps, they have rioters demonizing the other. But, honestly... can we really trust what anyone says about the whole thing? I don't think I've found an unbiased source yet in talking about this stuff. Everyone has their side, who they are willing to defend to the death. So, what good does all this do?
The main thing that I want is honesty. (Ha... politician's actually being honest. It's sad that I feel so skeptical, and cynical about the whole damn process) If we have to have a recession to set things right again, then let's do it. Let's let our capitalistic system return itself to normal, reset itself, as it were. I'd rather have that, live through that, than continue to live in the economic bubble we've enclosed around ourselves.
There needs to be some accountability, somewhere. And, I'm almost praying that the economy continues to fall... just so that there can be some justice in the system, somewhere.
This guy had an interesting take, which I think is worth thinking about also.
I thought this article in the Sun-Times was interesting. It shows by the numbers what each would do.