Former Rep. Pat Toomey pointed out Tuesday night in the NRO debate symposium that Sen. John McCain (R., Ariz.) refused to admit his error in 2001 and 2003 voting against the Bush tax cuts. McCain claimed instead that he had opposed the tax cuts because they were not accompanied by spending cuts.
But McCain’s answer was misleading, and it contradicts what he has said since he voted to keep taxes higher. He claims that he opposed the first round of President Bush’s tax cuts because there was no crackdown on spending, but he sounded a different note in February speaking to Robert Novak (my boss) when he said, “I can’t tell you that I cast exactly right votes over the years.”
Looking back to the spring of 2001, when the Senate was considering the first big tax cut of $1.35 trillion, McCain was not talking about the need to cut spending. He was denouncing supply-side economics, sounding like a Democrat as he complained that Bush’s tax cuts would reduce marginal rates by too much.
In a January 2000 Iowa debate against Bush, McCain confronted the Texas governor over his tax plan with this remark, which could just as easily have come from a Democrat: “Your tax plan has 36 percent of it going to the richest 1 percent in America. … I think that we ought to give the tax relief to the people who need it most.”
In a March 11, 2001 interview with Wolf Blitzer, McCain said that there was “a belief in America that too much of this tax cut still goes to the wealthiest Americans.”
McCain was quoted in the Los Angeles Times on May 27, 2001 engaging in still more Democratic rhetoric on tax cuts: “I cannot in good conscience support a tax cut in which so many of the benefits go to the most fortunate among us at the expense of middle-class Americans who need tax relief.”
None of McCain’s rhetoric at the time evinces a desire to cut spending as much as a desire for a more progressive system of income taxes.
President Bush has never given robust public support to the ideas behind supply-side economics, preferring instead to discuss tax cuts in Keynesian terms, as though they only put money back into consumers’ pockets. But his actions have spoken for Reaganomics. All of Bush’s signature tax cuts, including his capital-gains and dividend tax cuts of 2003 and the accelerated expensing and depreciation provisions that came after 9/11, have favored freeing up the investment capital of business owners and investors, so that they can create more jobs and help the economy overall.
McCain, by contrast, has been out front in denouncing the economic policies pioneered by President Reagan. He opposed the 2001 and 2003 tax cuts, and then, until very recently, he was a champion for preserving the inheritance or “death” tax on the grounds that it makes American society more egalitarian, preventing the excessive accumulation of family wealth.
McCain has always been strong on the issue of containing pork-barrel spending, but he should not get a free pass on his aversion to cutting marginal rates. Supply-side economics embraces the reality that business-owners’ and investors’ money makes the world go round — and when the government confiscates less of it, there is more available to create more economic growth and employ more Americans.