Monday, October 27, 2008

Lower Taxes AND More Spending

What neither candidate is going to tell you about their economic plans is that they're both wrong. The way to get out of the mess we're in is both to lower taxes and increase spending.

Keep in mind that I consider myself a deficit hawk. But as the economy slips into the worse recession since the Great Depression, the way out is going to involve expanding the deficit for a while.

That means that McCain's call to freeze spending is exactly the wrong move. What we need now is MORE spending, although on the kinds of things that will immediately stimultate the economy: infrastructure, local government, home ownership, new energy industries. Without the right kind of spending, our economy won't have the juice it needs to kick back into gear.

And while Obama is correct that the biggest tax help needs to go to the middle class, McCain has a point that this is not the best time to be increasing taxes on businesses. A smart Obama administration will find a way to fudge any tax increase to 2010, when the economy can start growing again.

Either way you look at it, however, it would seem that McCain's freeze plan would pose more danger to the economy than Obama's tax plan.

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