McCain Aide Says Bush Knows Little About Economy (Update1)
By Matthew Benjamin
bloomberg.com
June 6 (Bloomberg) -- George W. Bush's policies on the economy, other than on taxes, have been a failure, suggested John McCain's top economic policy adviser.
Douglas Holtz-Eakin said the only similarity between McCain's economic plan and Bush's is a commitment to keep taxes low.
``Sadly, it seems that is all President Bush understood in the economy,'' Holtz-Eakin said in an interview to be broadcast this weekend on Bloomberg Television's ``Conversations with Judy Woodruff.'' It is Barack Obama's budget plan, not Senator McCain's, that resembles Bush's policies, he said.
``It's dedicated to the recent Bush tradition of spending money on everything,'' Holtz-Eakin said.
This is the latest and most aggressive effort by the McCain campaign to distance the candidate from the unpopular policies of Bush. Illinois Senator Obama has charged that a McCain victory in November would amount to a third Bush term on economics.
Dan Tarullo, an economic adviser to Obama who was also interviewed on the program, defended the presumptive Democratic nominee's plan to reopen the North American Free Trade Agreement to add new environmental and labor standards and get tougher on China for its trade policies. Analysts have criticized those plans, saying they may undermine U.S. trade relationships and curb export growth.
Good for Workers
Re-negotiating Nafta ``is good for our workers in all three countries and it's good for the environment in all three countries,'' said Tarullo, a professor at Georgetown University in Washington.
Holtz-Eakin disagreed, saying that re-opening Nafta would harm the image of the U.S. in the world after it had already been ``damaged'' by Bush.
``I think the Canadians and the Mexicans were scratching their heads when someone running for president of the United States announced unilaterally that it was time to rethink this deal,'' he said. Such statements ``startle our international partners,'' he added.
On China, Tarullo said Obama's promise to force Asia's second-biggest economy to alter its trade practices, which emphasize exports, makes sense because ``China's current economic policies are not sustainable.'' China's economy grew at 10.6 percent in the first three months of the year and prices rose 8.5 percent in April from a year ago.
`Steady Engagement'
Threatening the Chinese doesn't help the trade relationship with that nation, the fastest-growing major economy, Holtz-Eakin said, adding that Arizona Senator McCain, the presumptive Republican nominee, favors ``a steady engagement'' with China. It's unwise, Holtz-Eakin said, ``to unilaterally try to impose something on the Chinese.''
Holtz-Eakin, a former director of the Congressional Budget Office, defended McCain's tax plans, which include extending Bush's tax cuts, reducing the corporate tax rate and repealing the alternative-minimum tax. McCain would offset those cuts by reexamining the entire federal budget and vetoing earmarks to reduce spending.
``That plan, when appropriately phased in, as it has always been intended to be, will bring the budget to balance by the end of his first term,'' he said. Budget watchdog groups such as the Concord Coalition in Washington have said that's unlikely because of a large imbalance between the size of the tax cuts McCain proposes and the spending reductions he cites to offset them.
Holtz-Eakin said that those groups' analyses were based on ``incomplete information,'' and that they have since been provided with further details.
That was news to the Concord Coalition, which is still waiting for more information from the McCain campaign.
`Really Ticked Off'
``I haven't received anything, and if some of the other groups have then I'll be really ticked off,'' Concord executive director Bob Bixby said yesterday. ``If he's got some more complete budget proposal he can send I'd love to get it.'' As far as he knows, Bixby says, McCain's proposed spending cuts still don't come close to offsetting his tax cuts.
A Bloomberg News analysis of McCain's budget, which was released in April, shows it would increase the national debt by $1.8 trillion over eight years. Groups such as the Center on Budget and Policy Priorities and the Tax Policy Center, both based in Washington, estimate the cost to be even higher.
McCain, 71, has been attempting to separate himself from the unpopular current president, whose approval rating is hovering near 30 percent in most polls, as the presidential race against Obama heats up.
No `Cookie-Cutter'
``Anyone who knows John McCain knows that he is far from a cookie-cutter of George Bush,'' said Holtz-Eakin.
McCain often opposed Bush's policies. He disagreed with the president on torture and campaign fundraising issues and opposed both of the administration's major tax cuts, which put him at odds with Bush's tax philosophy even as Holtz-Eakin says the two are in agreement. Holtz-Eakin said McCain voted against the tax cuts to keep the deficit from rising.
Since Bush took office in 2001, the national debt has risen by about $1.7 trillion.
``He's rejected the entire Bush legacy of out-of-control spending,'' the adviser said.
Asked if their candidates would renominate Federal Reserve Chairman Ben S. Bernanke, Holtz-Eakin said McCain ``has full confidence in Chairman Bernanke'' while Tarullo ducked the question, saying only that, in making appointments, Obama, 46, would ```be looking for people with intelligence, experience and integrity.''
To contact the reporters on this story: Matthew Benjamin in Washington at mbenjamin2@bloomberg.net.
Last Updated: June 6, 2008 14:39 EDT |
