In the debate Tuesday night in Nashville, Tennessee, one that he desperately needed to win in order to turn back the Barack Obama tide, Senator John McCain utterly failed.
In a debate that was set in a townhall type of meeting where the presidential candidates fielded questions from an audience of undecided voters, Mr. McCain failed to deliver. The knockout blow he needed to assure Americans that he would be the right President to deal with the nation's economic problems eluded him. It was ironic because the debate's townhall format was supposed to play to Mr. McCain's strength.
But unlike Senator Obama who was able to articulate the economic issues down to the level of how such issues affect family's budgets, their access to credit, their retirement funds and everyday lives of millions of Americans, Mr. McCain pretty much stayed within his comfort zone. He stuck to his favorite talking point that freezing government spending would lead to lower deficits and therefore, lower taxes.
However, McCain's line did not and still does not resonate well with the average American. In a time when people are gravely concerned about the impact of the financial crisis on their family budgets, their access to credit, their purchasing power, and their ability to save for retirement, education, and health care, Mr. McCain failed to directly address such concerns. The impact of reduced government spending on the lives of taxpayers are not immediately felt when compared to reduced witholding (or payroll) taxes that people will immediately see on their paychecks.
There's a lot of anxiety and worry over the financial crisis. People are cutting back on spending. I take the train to work and I noticed recently that there are a lot more cars on my train station's parking lot these days, a sign that more people now commute than drive themselves to work. Last week, a report came out that car sales in the US which normally average about 1.3 million units a month registered September sales of 965,000, roughly a 26% drop. All carmakers, even the Japanese, reported double-digit drops in sales figures. ABC News recently reported that more than 500 car dealerships have closed since the start of the year. The lower sales was attributed to customers cutting back on spending and tighter access to car loans. Restaurants, department stores, airlines, jewelry stores have all reported drops in revenues.
Mr. McCain was correct when he stated that there was too much anger out there at Wall Street and at Washington because by failing to prevent the financial crisis, both institutions failed the country. However, as in the first debate, Mr. McCain failed to strongly explain to the people how his proposals to reduce taxes and government spending would benefit them. He failed to raise people's doubts on how Mr. Obama's proposals, specifically on how his (Obama's) plans to increase government spending on social programs while simultaneously reducing taxes would not further increase a trillion-dollar budget deficit.
Mr. Obama's plan to reduce taxes on 95% of the population, specifically the ones who make less than $250,000 a year, hopes to stimulate spending among the middle and lower classes. The plan is also aimed at helping small businesses expand and create jobs. It's true but only up to a certain point.
The problem with the Obama tax proposal, as Mr. McCain has correctly and repeatedly pointed out, is that to make up for the tax cuts on the middle class, Mr. obama will increase taxes on the 5% of the population, that segment of society we used to call "rich" but are now known as the "investor class".
It is correct that small businesses generate many jobs. However, it is outdated and folly to think that a nation's economy will significantly progress if one sector is awarded at the expense of another. That, for me, is divisive politics. One also needs to see the big picture here. It is the large corporations that create the better-paying jobs and consequently, higher quality and quantity-type of demand that help make a lot of small businesses thrive and grow. It is the large corporations, with their big-ticket capital expenditures in facilities, people and equipment, that contribute to a significant portion of a nation's wealth. In addition, that 5% of the population Mr. Obama plans to raise taxes on are already shouldering, according to some estimates, roughly 80% of the nation's tax burden. The plan to further increase their share of the country's tax burden could prove to be a disincentive to infusing more capital into the economy at a time when such investments are badly needed.
I do agree with Mr. Obama that in order for a capitalist economy like the United States to continue to thrive and maintain its standing as the world's most trusted financial system, that a certain degree of industry regulation should be put in place. I strongly agree that the trend towards deregulation that began roughly in the early 1980s under the Reagan administration has led to spectacular abuses of power among corporate executives and to a decline in certain industries such as the US airline industry. The current financial crisis ought to change a lot of people's views about deregulation. Every game needs a referee.
But going back to the debate, I was quite disappointed in Mr. McCain's performance because his proposal to cut taxes for all Americans to create more jobs and generate investment and his plan to curb government spending to address the growing budget deficit stand on solid ground. In addition, Mr. McCain has long been an advocate of regulation, much to the chagrin of his colleagues in the Republican Party who believe otherwise. He has also gone against his party numerous times on critical issues such as the waste of government money on pork-barrel spending. The campaign finance reform law that carry his name and that of Democratic Senator Russ Feingold aims to reduce the corrupting influence of lobbyists in Washington DC. He successfully fought for the passage of this law in spite of opposition from the Republicans, including President George W. Bush.
In contrast, Mr. Obama's track record in the US Senate in his four years there does not show a man who has gone against his party to address issues of corruption and excess. He has not authored or even co-authored a single law of national significance. In addition, in his four years as Senator, he spent the last two years running for President. As a result, among all the men who have run for US President, he has the thinnest resume. But thanks to Mr. McCain's failure on Tuesday night to strongly argue the merits of his (McCain's) economic proposals, it seems a certainty now that Mr. Obama will become the 44th President of the United States.
That's not to say that Mr. Obama does not have the intelligence to hold the most powerful office in the country and in the world. His Harvard law degree and his cool and poised demeanor during the debates showed unassailable evidence of it. Like all the Presidents that have come before him, he will certainly tap the best minds within the Democratic Party to advice him on domestic and foreign policy. He will certainly make history once he gets elected as the first African-American President. However, due to the absence of a defining professional track record that reveals his thought and decisionmaking processes, he is leaving millions of voters no choice but to simply rely on his promise of change not only in the US but also in the world. That would truly be the Audacity of Hope.
