Sen. McCain is blissfully out of touch

By Joshua A. Swanson,
Published Sunday, August 31, 2008

John McCain showed how out of touch he is with the economic crisis facing millions of Americans – particularly those of us without bank accounts topping $5 million. During a forum at Saddleback Church in Lake Forest, Calif., McCain was asked by Pastor Rick Warren, “At what point, give me a number, give me a specific number. Where do you move from middle class to rich?”

McCain’s response is telling as to how blissfully far-removed and out of touch he is with the seriousness of the economic problems facing our country. “How about $5 million,” McCain answered.

It takes $5 million to be considered rich? This answer is a telling indicator in providing a forecast for the economic priorities of McCain, particularly for North Dakotans, where the average per capita income is $32,763.

Tax break?

While McCain may be living comfortably, millions of Americans, including many North Dakotans, are feeling the pinch – a pinch the presumptive GOP nominee cannot begin to fathom when he claims the dividing line between the rich and middle class is $5 million. When he talks about middle-class Americans, and tax breaks for the middle class, McCain is not talking about you and your family. No, he’s talking about those he considers rich, those with helipads in their backyards and whose yearly bonuses exceed your yearly salary several times over.

According to James P. Smith, a senior economist at the Rand Corp., this $5 million threshold encompasses “almost nobody.” Of all American households, less than one-tenth of 1 percent has a yearly income of $5 million. But guess where the majority of the McCain tax breaks go?

This $5 million threshold and McCain’s inability to comprehend the economic realities facing our country are reflected in his tax and energy plans. The most comprehensive nonpartisan analysis of the candidates’ respective tax proposals, conducted by the Tax Policy Center, supports Barack Obama’s claim that his plan will not increase your taxes – that is, unless you earn $169,480-$237,040. If you’re in this bracket, then you’d pay roughly $486 more in taxes. For all of us under $169,480 of taxable income, we’d benefit from a tax cut under Obama’s plan.

Under McCain’s tax plan, you would not see a tax cut in this bracket. Additionally, families earning $37,595-$66,354, which includes the vast majority of North Dakotans, would get an average tax cut of $1,042 per family under Obama’s plan. Under McCain’s plan, this bracket would only see $319, according to the report. Just like President Bush’s tax cuts, the bulk of McCain’s tax breaks go to the wealthiest percentile of Americans in the top marginal rate, which would cost our treasury nearly $1.6 trillion over the next 10 years. Not exactly the prescription to balance the budget – or provide tax relief to the middle class.

Flawed energy policy

The economics of this intersect with McCain’s energy policy. Today, with the prices at the pump still hovering around $3.55, McCain has opposed both taking oil out of the strategic petroleum reserve and a $1,000 energy rebate to taxpayers, funded by a windfall profits tax on the record profits of oil companies.

Don’t be fooled by those wind turbines in his commercials, McCain has opposed legislation that would provide tax incentives for the clean, renewable energy sources of wind and solar power, and has done so as recently as Aug. 1. McCain is also an active opponent of incentives for ethanol production. Why? Follow the money – since publicly announcing his support for offshore drilling this June, campaign contributions from the oil and gas industry to McCain have exploded. In Texas alone, June donations to McCain’s “Victory ’08 Fund” reached $1.214 million. This does not include the 33 McCain staffers and fundraisers who have received $19.3 million in lobbying fees from the oil and gas industry.

After eight years of regressive tax and energy priorities, it is time for a change. Moreover, with North Dakota’s potential as both a wind energy and ethanol leader, McCain’s economic and energy priorities are cause for concern. Maybe as soon as the rest of us start pocketing that $5 million it takes to be rich, we’ll start seeing the advantages of electing McCain our president. Until then, North Dakotans should think long and hard before deciding that McCain is in the best interests of our state.

Swanson, a native of Maddock, N.D., is lead articles editor, Creighton Law Review, Creighton University School of Law, Omaha.