Policy Positions Re: ECONOMIC PLANS

OBAMA ON THE ECONOMY

Bush tax cuts:

• Obama wants to make permanent the 2001 and 2003 income-tax cuts for about 94 percent of tax filers -- those making less than $200,000 a year.
• He will either repeal the Bush cuts for the top one percent of taxpayers, or allow the cuts for those taxpayers to expire in 2010.
• He will let the tax cuts on income from capital gains and dividends expire in 2010 -- raising the rate from 15 percent to 28 percent.
• He will restore most of Bush's temporary estate tax cut to a 45 percent rate for estates valued at $3.5 million or more.

New tax cuts:

• Obama would grant a yearly tax credit of $500 for individuals and $1,000 for married couples that would apply to all workers who pay Social Security.
• Also, those 65 and older earning less than $50,000 a year would be exempt from income tax.
• The price tag: $280 million over 10 years.

The budget:

• Obama has rhetorically committed to "pay-as-you-go."
• Some revenue -- but not much in the short term -- would come from a proposed 2 percent to 4 percent surcharge on high earners to reduce Social Security's projected shortfall after 2017.

Housing and credit crisis:

• Obama would empower the Federal Reserve to regulate investment banks and any other institutions to which it lends.
• His 2007 bill would expand federal regulation of mortgage lending and toughen criminal penalties for fraud.
• Proposes a $10 billion fund to help homeowners avoid foreclosure and $10 billion to help state and local governments.

Source: "Obama on the Economy," in "Where They Stand," National Journal, August 30, 2008.

For text:

http://www.nationaljournal.com/njmagazine/nj_20080830_3632.php


MCCAIN ON THE ECONOMY


Bush tax cuts:

• McCain plans to make permanent the 2001 and 2003 income-tax cuts that expire at the end of 2010, including those that set the tax rate for most dividend and capital-gains income at 15 percent.
• He would preserve most of Bush's temporary cut in estate taxes, establishing a 15 percent rate for estates worth $10 million or more.

New tax cuts:

• McCain has pledged to eliminate the alternative minimum tax.
• He wants to double the personal exemption for dependents from $3,500 to $7,000, a move that benefits larger families.
• He wants to cut the corporate income-tax rate from 35 percent to 25 percent.

The budget:

• McCain has committed to a "pay-as-you-go" approach to budgeting, but has not explained how his tax cuts would be financed.
• McCain contends that hundreds of million of dollars can be saved each year by eliminating "waste, fraud, and abuse," but he has not provided examples.
• McCain's tax cuts would cost as much as $400 billion a year, or about 40 percent of all discretionary spending.

Housing and credit crisis:

• McCain supports a larger, but unspecified, role for the Federal Reserve in regulating financial institutions but encourages -- rather than requires -- larger capital reserves by banks.
• Opposes large increases in government spending to help renegotiate existing mortgages, and proposes programs that would exclude people who borrow too much to buy their homes or are currently unlikely to meet the terms of a new mortgage.

Source: "McCain on the Economy," in "Where They Stand," National Journal, August 30, 2008.

For text:

http://www.nationaljournal.com/njmagazine/nj_20080830_3632.php
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