CBS: Obama Tax Policy Better For Middle Class

A report on the economic policies of John McCain and Barack Obama by correspondent Chip Reid on Monday’s CBS "Evening News" suggested that Obama’s supposed middle class tax cut would be more beneficial for American families: "Obama's plan is to roll back the Bush tax cuts for the wealthy and use the savings for a middle-class tax cut...A recent study by the non-partisan Tax Policy Center says Obama's plan would give a cut of more than a thousand dollars to families making between $37,000 and $66,000 a year. Under McCain's plan, they'd get just $319."

The "non-partisan" Tax Policy Center is actually a product of the left-leaning Brookings Institution and Urban Institute. Reid went on to explain that: "On spending, Obama wants to jump start the economy with another round of stimulus checks for taxpayers to the tune of $50 billion." After outlining McCain’s policies on taxes and spending, Reid observed: "McCain also now supports extending the Bush income tax cuts, even though he once opposed them as too generous to the wealthy. Barack Obama says McCain's switch is more evidence that a McCain presidency would be more of the same. "

At the end of the segment, Reid mentioned the candidates’ proposals on gas prices: "As for the price of gas, both candidates have elaborate plans for bringing it down in the long run but neither one offers much in the way of short-term relief." Apparently Reid forgot about McCain’s support for a temporary gas tax holiday. While the effectiveness of that policy can be debated, it certainly would qualify as "short-term relief."

Back on the June 29 This Week, George Stephanopoulos cited the same numbers and Brent Baker pointed out on NewsBusters that picking up on the Tax Policy Center's raw numbers, the right of center Tax Foundation crunched them and discovered a trend the media rarely discuss:

Obama's plan would greatly accelerate the decades-long trend toward a federal government that depends for tax revenue almost exclusively on a few high-income people.

This contrasts starkly with the McCain plan, according to [Tax Foundation President Scott] Hodge, which would give every taxpayer a cut and leave the current tax burden distribution approximately where it is.

An excerpt from the Tax Foundation's June 26 press release:

"Under the Obama plan for 2009," explains Hodge, "more than $131 billion would be redistributed from the top 1 percent of taxpayers to all other taxpayers."

As a result, the top 1 percent of households would pay more federal taxes of all kinds than the bottom 80 percent of households. That lopsided distribution under Obama does include payroll taxes and other federal taxes, but it excludes the new payroll tax hike that Obama plans to levy on people making more than $250,000 because details about that plan are currently unclear.

"In other words," says Hodge, "it is at this point a cautious estimate to say that in 2009, under Obama's plan, 1.13 million Americans would pay more in all federal taxes than 128 million of their fellow citizens combined."...

Here is the full transcript of the July 7 CBS Evening News story:

KATIE COURIC: Meanwhile, Senator Obama had to postpone a trip to North Carolina today. His plane from Chicago made an unscheduled landing in St. Louis after a problem developed in the tail. Senator Obama ended up delivering a speech from St. Louis. Both he and John McCain, who campaigned in Denver, are this week making the economy job one. Here's Chip Reid.

CHIP REID: Both presidential candidates laid out their economic plans today. For John McCain, there are two basic themes: Cut spending.

JOHN MCCAIN: I'll veto every single bill with wasteful pork barrel spending on it. You can count on it.

REID: And cut taxes.

MCCAIN: The choice in this election is stark and simple. Senator Obama will raise your taxes; I won't.

REID: A position that had some passionate fans at today's town meeting in Denver.

UNIDENTIFIED WOMAN: Tax us when we eat! You tax us when we sleep! You tax us every which way! Get off of my back!

MCCAIN: If you're not busy, I'd like to take you with me wherever I go.

REID: McCain also now supports extending the Bush income tax cuts, even though he once opposed them as too generous to the wealthy. Barack Obama says McCain's switch is more evidence that a McCain presidency would be more of the same.

BARACK OBAMA: John McCain's policies are essentially a repeat, a regurgitation, of what we've been hearing from the Republican Party.

REID: Obama's plan is to roll back the Bush tax cuts for the wealthy and use the savings for a middle-class tax cut.

OBAMA: If you make less than $250,000 you will not see a tax increase under my plan. No matter what John McCain says.

REID: A recent study by the non-partisan Tax Policy Center says Obama's plan would give a cut of more than a thousand dollars to families making between $37,000 and $66,000 a year. Under McCain's plan, they'd get just $319. On spending, Obama wants to jump start the economy with another round of stimulus checks for taxpayers to the tune of $50 billion.

EAMON JAVERS: The real question for Barack Obama is how do you pay for all these goodies you want to dole out on the campaign trail?

REID: As for the price of gas, both candidates have elaborate plans for bringing it down in the long run but neither one offers much in the way of short-term relief. Katie.

COURIC: Chip Reid on Capitol Hill. Chip, thank you.