Power And Dollar

Obama vs McCain Platform

This is written on 2008.06.11,  Obama made his tax plan announcement on 2008.08.12.  Please consult this link for taxes, especially personal income tax:

https://royho.wordpress.com/2008/08/15/obama-vs-mccain-platform-part-3-your-taxes/

 

For foreign policy:

https://royho.wordpress.com/2008/07/21/obama-vs-mccain-platform-part-2-foreign-policy/

Below is the original on 2008.06.11:

___________________________

 

CNN is giving out a good introduction of the Obama vs. McCain platform contrast.  

http://money.cnn.com/2008/06/11/news/economy/candidates_taxproposals_tpc/?postversion=2008061113

 

I figure this is the right time for me start as well.  Obama has deep roots not only in the city of Chicago, but also the Chicago School of economics since he has been a faculty in the law school there.  Click here to read a contrast by Tax Policy Center.  

http://www.taxpolicycenter.org/taxtopics/election_issues_matrix.cfm

 

One central theme across the revenue side of the Obama’s fiscal policy is he is concentrating his effort on invigorating domestic demand:  he is trying to lift up aggregate demand.  All tax cuts are focused on low income groups.  A typical Democrat policy is to tax the rich and create programs for the poor.  This Democrat is minimizing the tax burden on the poor. 

 

Taxing a low income filer and then distribute welfare check to him is make work for the bureaucrats.  The real gain is among the civil servants.  The first relief to the poor is not the welfare checks but to make sure they do not even qualify to pay taxes.  There are too many of these points Obama raised that would any economics professor happy.  This, Obama is heading toward. 

 

And there are too many of those points to get listed here.  Please consult the Tax Policy Center website. 

 

A contentious point to-be for McCain is the corporate tax reduction from 35% to 25%.  If we consider the fiscal revenue since 1945, anyone can see that the tax burden of corporates reduce from 35% to 14% in 2007, while personal income tax continues to hover around 45% for the same period.  

 

McCain makes (or will make) the argument that employers need to be able to create jobs.  Most of the jobs are created by small businesses.  For that, Obama has a tax credit of 20 percent on up to $50,000 of investment in small owner-operated businesses; Eliminate capital gains taxation of start-up businesses; Provide capital gains tax break for landowners selling to beginning family farmers.  

 

What is really indefensible of Obama’s platform is capital gain.  Obama will increase capital gain tax.  What does it matter, you may ask, since capital gain is a rich man’s business.  It may not exactly be there.  It can affect your mutual funds, pension funds and alike.  Given social security is shaky, capital gain tax can have unintended consequences.  This will require a closer look at the proposal, compare it against the tax code and check the statistics.  

 

Obama is also encouraging saving through mandating 401(k) and IRA accounts.  It of course increases administration cost on the employer side.  However, a detailed look at the proposal is important for this one since this requirement can elevate some of the pains on Social Security.  The trade may be worth it. 

 

A real electioneering tax gimmick is the elimination of taxes for seniors with income below $50k.  this is on the platform because seniors are vote rich.  Increasing the personal exemption from $4k to, say, $8k is more effective in lifting aggregate domestic demand than concentrating on the seniors.  

 

Fiscal policy is a good place to address the environment agenda.  However, that is missing from both candidates.  Both advocate to close oil and gas loopholes.  Obama specifically want to make the R&D for renewable energy production permanent.  However, this is supply side economics.  Obama could levy taxes on this area and reduce more income tax.  

 

A simple glance at the fiscal revenue policy can tell that Obama team has put more effort into fiscal revenue policy than McCain team, although McCain is the Republican candidate. 

 

Is McCain having a retirement party?

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June 11, 2008 - Posted by | Barack Obama, Current Events, economics, election, Election 2008, John McCain, mccain, obama, opinion, politics, Thoughts, wordpress-political-blogs

8 Comments »

  1. […] unknown wrote an interesting post today onHere’s a quick excerptWhat is really indefensible of Obama’s platform is capital gain. Obama will increase capital gain tax. What does it matter, you may ask, since capital gain is a rich man’s business. It may not exactly be there. It can affect your mutual … […]

    Pingback by My new WordPress MU Site » Blog Archive » Obama vs McCain Platform | June 11, 2008 | Reply

  2. I’m curious where you got this from: “If we consider the fiscal revenue since 1945, anyone can see that the tax burden of corporates reduce from 35% to 14% in 2007,”
    I also just have to say that Obamas mandating anything is un American and I’m leery of the whole sending a tax bill to people thing. Anyway look forward to your reply . Note amongst other sources I found this http://www.smbiz.com/sbrl001.html#pis07

    Comment by Alfie | June 11, 2008 | Reply

  3. […] Obama vs McCain PlatformClick here to read a contrast by Tax Policy Center. http://www.taxpolicycenter.org/taxtopics/election_issues_matrix.cfm. One central theme across the revenue side of the Obama’s fiscal policy is he is concentrating his effort on …Roy Ho's Blog – https://royho.wordpress.com […]

    Pingback by tax policy center | Lasts information | June 11, 2008 | Reply

  4. […] Obama vs McCain PlatformClick here to read a contrast by Tax Policy Center. http://www.taxpolicycenter.org/taxtopics/election_issues_matrix.cfm. One central theme across the revenue side of the Obama’s fiscal policy is he is concentrating his effort on …Roy Ho's Blog – https://royho.wordpress.com […]

    Pingback by tax policy center | Hottags | June 11, 2008 | Reply

  5. Alfie,

    your question:
    http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?DocID=203&Topic2id=20&Topic3id=21

    the link you give is the tax table for you and me.
    the link above is the tax revenue of the fed gov’t. they are 2 different things.

    i share your leery. what i looked at is the stuff on paper. the walk and the talk are 2 different things.

    Comment by royho | June 12, 2008 | Reply

  6. […] vs mccain platform June 11, 2008. I??m curious where you got this from: ???If we consider the …https://royho.wordpress.com/2008/06/11/obama-vs-mccain-platform/Rock the Vote Blog: McCain v. ObamaTuesday, June 03, 2008. mccain v. Obama. The General Election is […]

    Pingback by mccain v obama platform | June 19, 2008 | Reply

  7. If anyone can help me here … I read in a “partisan” article that regarding:
    CAPITAL GAINS TAX (specifically on housing)

    “MCCAIN
    0% on home sales up to $500,000 per home (couples). McCain does not propose any change in existing home sales income tax.

    OBAMA
    28% on profit from ALL home sales”

    .. is this true and/or can you explain further

    and would this same calculation hold up for selling a small business?

    Please can anyone help me here.
    glojdo@aol.com

    Comment by Gloria Jadot | August 10, 2008 | Reply

  8. Gloria Jadot,

    Obama said 28% on capital gain back in april. he did not say specifically “home sales.” however, “capital gain” applies to home sales.

    no news on mccain on this specific one, which probably means he is not proposing changes.

    however, anything can change after the election.

    Comment by royho | August 11, 2008 | Reply


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