DMI Blog

Amy Traub

John McCain, Middle Class Champion?

Mike Huckabee talks the populist talk, but his actual policy proposals – from noxious tort “reforms” to a National Sales Tax that hits the middle class hard and lets the rich off the hook – are anything but. So in today’s New York Times, columnist David Leonhardt suggests that Republicans feeling the middle-class squeeze look elsewhere. His suggestion? Senator John McCain.

As Leonhardt describes it, McCain lacks the Bushies’ blind faith in the magic of the free market, preferring instead to restructure market incentives to produce desirable outcomes. If true, McCain’s stance represents a huge step toward reality-based public policy. The truth is, markets are not magical: they don’t naturally spring into being and cannot function without an extensive set of government rules and regulations, from patent protection to legal liability. The incentives at work in any marketplace are shaped on every level by government policy, from tax rates, to the choice about where to build a new highway, to the decision about how much money to print, not to mention the minutiae of professional licensing, employment law, consumer protections, zoning codes and so on. Economic conservatives may favor a particular set of rules for structuring markets (say a tight monetary policy, strong protections for private property, and weak consumer regulations) but there’s nothing natural – or, for that matter, inherently “free” – about these particular choices. So if we don’t like the results the current set of market rules are producing, whether its drastic inequality or global warming, altering those rules to change the incentives makes sense.

Whew. Returning to earth from the lofty realm of political-economic theory, what does this mean in terms of McCain’s concrete policy proposals? Leonhard details McCain’s energy plan, an effort to address global climate change through limits on carbon emissions and a cap-and-trade system. Unlike many of his Republican colleagues, McCain doesn’t want to abolish estate taxes, but would raise the exemption to a stratospheric $10 million. And, Leonhard writes, McCain proposes “subsidizing the incomes for laid-off older workers, to encourage them to accept a lower-paying job rather than remaining unemployed.” While none of these are visionary policies, they do represent a genuine willingness to move beyond right-wing orthodoxy and grapple with the real world problems faced by the nation’s current and aspiring middle class. McCain’s well-known leadership in the Senate on immigration and campaign finance reform demonstrate a similar willingness to move beyond right-wing orthodoxy.

However, McCain’s actual voting record in the Senate is less positive for the middle class. Like most candidates running for President, McCain missed a significant number of important votes in 2007, skipping the original SCHIP vote, the Peru trade agreement vote, and the energy bill. He was around to oppose raising the minimum wage, however, and cast a vote against the Employee Free Choice Act, the single piece of the legislation with arguably the greatest potential to strengthen and expand the middle class. (The bill would economically empower working people by making the process of choosing union representation at work less arduous.)

In 2004 and 2005, McCain received an F for his middle-class voting record, voting not to restore Bush’s cuts to the Earned Income Tax Credit and health care for the poor; not to increase Pell Grants enabling low income students to go to college; and not to protect workers’ access to overtime pay for working more than 40 hours a week. McCain also supported the infamous 2005 bankruptcy bill which imposes onerous conditions mostly on middle-class families pushed to insolvency by job loss, massive unexpected medical bills, or divorce. This harsh legislation is likely to compound the devastating effects of the current sub-prime mortgage crisis, leaving families with no way out of a debt burden they cannot possibly manage.

On the positive side, McCain voted against massive pork-barrel subsidies to the oil and coal industries in the 2005 energy bill. Most impressively, in 2005 he supported enabling Medicare to negotiate with drug companies to lower prescription drug prices, although he missed a similar vote in 2007.

All in all, this is hardly the record of a middle-class champion. McCain may be willing to tinker with the rules shaping the market, but he’ll intervene on the side of credit card companies to the detriment of middle-class families; weigh in favor of corporations who want their employees working longer hours for less pay; and he’ll hold back when it comes to helping low-income workers get a much needed raise, much less the ability to organize a union if they want one. Reality-based policy is an important step. Actually acting to strengthen and expand the American middle class is something much better.

Amy Traub: Author Bio | Other Posts
Posted at 7:21 AM, Jan 10, 2008 in Congress | Economy | Middle-class squeeze | Politics |
Permalink | Email to Friend