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McCain Seizes on Obama's Tax Plan Tweak

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October 23, 2008 1:00 PM

ABC News' Teddy Davis, Bret Hovell and Julia Hoppock Report: John McCain is seizing on an ABC News report about Barack Obama tweaking his tax plan to argue that his Democratic opponent will "say anything to get elected." 

"This week we learned that Senator Obama is concerned that his plan of wealth redistribution is seen as welfare," McCain said Thursday morning in Ormond Beach, Florida. "So he just added a work requirement. Twelve days to go, thirteen days to go in this election he changed his tax plan because the American people have learned the truth about it and they didn't like it."

McCain's latest criticism of Obama refers to comments made Tuesday by Obama adviser Austan Goolsbee at the Council on Foreign Relations. The University of Chicago professor said that the Obama campaign changed a minor component of its tax plan to avoid criticism that it was tantamount to welfare. He made his comments while debating Douglas Holtz-Eakin, McCain's top policy adviser.

While Obama did tweak his tax plan, McCain is overlooking that the only aspect of the Obama plan that changed was the universal mortgage credit.  Obama's other refundable tax credits were already work-related including his make-work-pay credit, saver's credit, child-care credit, and college credit.

In his new line of attack, McCain overstates the degree to which Obama's tax plan was altered. The work requirement articulated by Goolsbee on Tuesday might end up excluding fewer than 1,000 otherwise eligible Americans from claiming Obama's universal mortgage credit, according to an Obama campaign estimate.

The minimal impact is because the work requirement could be met simply by having worked in the last taxable year or by having a spouse who works.

While Obama's campaign could legitimately complain that McCain is overstating the degree to which the Democratic tax plan changed, the Obama campaign decided to put out a statement which overlooks what its own economic adviser told the Council on Foreign Relations on Tuesday.

"All of Senator Obama's tax credits only go to workers and they always have," the Obama campaign said in a statement e-mailed to reporters. 

The truth is that when Obama originally outlined his refundable tax credits -- the vast majority of them went only to workers.

But there was one refundable tax credit -- the universal mortgage credit -- which did not have an explicit work requirement on it which meant that it was theoretically possible for a very small number of Americans to get a check from the government under an Obama proposal even though they were not working.

"They started saying this was welfare," Goolsbee told the Council on Foreign Relations.  "So, just so they would absolutely not be able to say that, we decided that for the last two percent we'll simply add a work requirement."

"When did this change? I'm just curious," an incredulous Holtz-Eakin asked Goolsbee.

"About two weeks ago," replied Goolsbee, adding that when the proposal was announced in September 2007, 98 percent of its benefits went to workers.

Watch it HERE.

After speaking to the Council on Foreign Relations on Tuesday, Goolsbee argued in an interview with ABCNEWS.com that he was not referring to a policy change but rather a change in what the Obama campaign decided it needed to make explicit. Goolsbee said the Obama campaign always assumed that every American would know that any new refundable tax credit would be tied to work because the refundable tax credits in current law are work related.

The purpose of Obama's 10 percent universal mortgage credit is to aid taxpayers who do not itemize when filing taxes. The Obama campaign estimates that it would provide an average of $500 to 10 million homeowners, the majority of whom earn less than $50,000 per year.

While McCain has hammered Obama’s refundable tax credits as constituting welfare, the Republican nominee has proposed a refundable tax credit to help Americans pay for health insurance which does not have a work requirement -- it would benefit all Americans regardless of whether they are working or not.

October 23, 2008 in McCain, John, Obama, Barack | Permalink | User Comments (426)

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Let me get this straight - Obama's "tax credits" are considered "welfare" while McCain's are considered "reform"? Does McCain think his voters are that stupid?

McCain is proposing refundable tax credits of up to $2,500 a year for individuals, or $5,000 for families, as part of his health care plan.

Posted by: Already Voted | Oct 23, 2008 1:06:09 PM

its all about giving more to upstage the other. where is the restraint that the bush administration didnt? people dont want more and more and more government. bush proved that as well as this financial crisis. and here we sit with both promising to take more to give more. stop the spending and give us real solutions

Posted by: will it end | Oct 23, 2008 1:12:04 PM

Plenty of people have been scratching their heads over Joe Biden’s warning to voters that electing Barack Obama would precipitate an international crisis to “test his mettle”. Investors Business Daily agrees with Biden, and notes that this wasn’t an off-the-cuff gaffe; Biden repeated the warning in two different venues. IBD points to an early Obama campaign video, in which Obama pledges unilateral disarmament on several fronts, as evidence supporting Biden’s hypothesis.

But there’s another angle to this, based on what Biden the senator knows — that Obama’s defense policies, once it’s obvious how they’ll undermine us, are likely to be very, very unpopular. In this case, Biden may be calling on his party’s hard, pacifist core — Moveon.org, Code Pink and the like — to stand by their man.

He’ll need their support. Like Jimmy Carter in the 1970s, Obama’s policies often sound good on the surface, but will in fact materially weaken America’s ability to defend herself. That’s not just our opinion, mind you; it’s straight from the horse’s mouth.

Such policies will create a vacuum that our foes will be only too happy to exploit.

In response to seeing a weakling in the White House, will Russia do something rash in Eastern Europe, like invade Ukraine? Will Putin put troops, missiles, or maybe nukes in Venezuela? Will South Korea develop a bomb, knowing the U.S. won’t stop it? Will Iran attack Israel, as it has promised, thinking America has become a paper tiger? We don’t know, but maybe Joe Biden does.

I think Biden wanted the Left to remain activist to support a retreat philosophy in the face of aggression from our enemies. Obama has consistently fronted that policy, in Iraq and elsewhere, both as a Senator and as a presidential candidate.

Biden knows Obama will need the Left to support the consequences of its Kucinich vision for American foreign policy.

Posted by: Hey Biden, Thank You for the Warning about Obama's Inexperience | Oct 23, 2008 1:15:17 PM

Yawn.

McCain is soooo desperate.

Posted by: Nancy | Oct 23, 2008 1:16:39 PM

Mccain is gonna Tax our Health Insurance we get through our Employers that we pay for through our salary now he will Tax this like Income it will be like paying Double tax

Posted by: Angie | Oct 23, 2008 1:19:32 PM

Perhaps thanks to Joe "born with a silver foot in his mouth" Biden the Obama campaign has learned the importance of making sure comments and such are stated accurately and clearly so as to aviod a many blunders as possible.

Posted by: Jenny Rome Ga | Oct 23, 2008 1:22:49 PM

I don't even listen to McCain or Palin anymore. History as far as I am concerned.

McCain will say and do anything to get you to vote for him. Sounds familiar.. it should, Bush did the same thing. McCain will get into office and be out on the golf course the next day. To heck with us and our issues.

Posted by: becky | Oct 23, 2008 1:27:09 PM

McCain needs to TWEAK his own plan and get positive.
While he's at it he can take his clothes back and TWEAK palin back to Alaska

Posted by: watching | Oct 23, 2008 1:29:07 PM

Just curious. How come the Hockey Mom couldn't buy her clothes at Target? 150k in 2 months? And she calls Obama an elitist? McCain has like 10 houses. The man is evil.

Posted by: palinforporn | Oct 23, 2008 1:31:04 PM

Here is a creative approach to redistribution of wealth.
Today on my way to lunch I passed a homeless guy with a sign the read 'Vote Obama, I need the money.' I laughed.

Once in the restaurant my server had on a 'Obama 08' tie, again I laughed--just imagine the coincidence.

When the bill came I decided not to tip the server and explained to him that I was exploring the Obama redistribution of wealth concept. He stood there in disbelief while I told him that I was going to redistribute his tip to someone who I deemed more in need--the homeless guy outside. The server angrily stormed from my sight.

I went outside, gave the homeless guy $10 and told him to thank the server inside as I decided he could use the money more. The homeless guy was grateful.

At the end of my rather unscientific redistribution experiment I realized the homeless guy was grateful for the money he did not earn, but the waiter was pretty angry that I gave away the money he did earn even though the actual recipient deserved money more.

I guess redistribution of wealth is an easier thing to swallow in concept than in practical application.

OR IS IT.........REDISTRIBUTION OF SOMEONE ELSE'S WEALTH IS A GREAT IDEA..............or just a fool's political game !!

Posted by: Tommy Neumann | Oct 23, 2008 1:36:03 PM

Mccain wouldn't know an economic tweak from campaign tactic if it was laid out in front of him...

he hasn't yet...as seen in his entire economic platform...

thank you Phil Gramm.

same team
same tactics
9th year.

Posted by: dl | Oct 23, 2008 1:38:29 PM

I'm still trying to figure out how John McCain can get away with emphatically saying that terrorists will not test him if he's President. How pompous & arrogant can you be? Just who in the hell is John McCain to where terrorists would just quake in their boots at the mere sight of him? So had he been the commander-in-chief on September 11, 2001, those planes wouldn't have crashed into those buildings in NYC? Terrorists would not have tried to fly a plane into the Pentagon(a plan thwarted by some REAL heroes might I add). Again here's another quote that was not read in its entirety. Biden was suggesting that anyone who takes that office will face this challenge. How senile must McCain be to think these animals will run scared of him. Why would they be afraid of him? What experience does he have that would deter a terrorist? Sure he was a POW, but doesn't that suggest that he got CAPTURED!!! Someone needs to remind the GOP presidential candidate that his name is John McCain, not Lucas McCain. Lucas McCain was a bad boy on "The Rifleman". John McCain is not even close.

Posted by: Dee Tee Gee | Oct 23, 2008 1:43:51 PM

Seriously, this constant change in the tax plan from whence Obama ran against Hillary vs now has shifted from the very very very far left to increase his original suggestion of >$100,000 per family income to >$250,000 and amongst others. Is this really a surprise that it changes again since he's changed it so often? Even is camp has said that they'll say anything now and fix it later once he goes into office (I am not kidding)... but of course it's not something people pick up on.

With all the plans he has to increase in spending and the universal healthcare... and for Barney Frank to say on Monday, "At this point there needs to be a focus on an immediate increase in spending I believe later on there should be tax increases. Speaking personally I think there are a lot of very rich people out there whom we can tax at a point down the road that would cover some of this money."

Does anyone really believe there will be a true tax cut for the middle income? Or perhaps they'll just hike the high income to 60% and leave the middle income and low income alone? And really... what is Obama's TRUE definition of rich? Is it "$100,000" as originally suggested or the now "$250,000". All this change is ridiculous.

And seriously, Palinforporn... and if she wears clothing that you suggest, then your group will call her whitetrash. I wonder why Obama's outfits are expensive. palin is the poorest candidate... there... comes from TRUE blue collar working class who has accomplished. Your Obama is an elite who hangs out w/his Eastcoast elitist and his Hollywood Elitist while putting down middle america. And you don't call that elitist? A plumber asks a question of him, and his socialist answers made people see him for who he is, and now he and his gang makes fun of Joe th plumber... and you don't see that as an elitist?

Obama says that mcCain fights for "joe the hedgefund manager" when it's Obama who has been receiving the most of the money from the "hedgefund" manager. Get real.

Your comment makes me think that you are a woman... b/c I don't think men are that petty. But for a woman to come up w/a name such as "palinforporn"... you've been hanging around the wrong crowd for way too long that your head is not screwed on right.

Posted by: Kim | Oct 23, 2008 1:45:10 PM

Tommy Neumann,
You copied that fake story from an earlier post by Venessa.

again, a humble & heartfelt thing would be to give them both 5 dollars and say nothing about it.

you sir are a thief

Posted by: watching | Oct 23, 2008 1:47:07 PM

If there is no new job creation, you won't have to worry about taxes. Imbeciles. Take a good look at Democratically controlled Michigan to get an idea what all of America will look like under Obama, Biden, Pelosi, Frank, Schumer, Rengel, Dodd, Reid, etc. It would be funny if not for the fact that you will be dragging the rest of us down with you.

Posted by: Mack | Oct 23, 2008 1:48:00 PM

different day...different message...

erratic.

Posted by: karen | Oct 23, 2008 1:48:05 PM

I'm voting against Barack Obama because I'm sick of the media, the weirdos in Hollywood, the hate Obama supporters and Democrats like John Murtha. I've been a Democrat all my life, and now Democratic leaders are calling members of their own party rednecks and racists just because we don't support the candidate chosen by the far left wing? THE DEMOCRATIC PARTY CAN GO STRAIGHT TO HELL.

Posted by: Another McCain Dem | Oct 23, 2008 1:49:33 PM

It is still socialism. If America becomes a socialist country that will be the end of America being the leader of the free world.

Dem for McCain/Palin 08

Posted by: emma | Oct 23, 2008 1:50:09 PM

Why are you worried about 150K for cloths when they are going to be auctioned off and they will make a hell of a lot more money off the auction. Also isn't what Palin did spending 150k doing what Obama wants and spreading the wealth around?

Tommy Neumann great post we all should find an opportunity to practice this to prove the point that hard working people do not need to have somebody else deciding how our money should be spent!

Posted by: chuck | Oct 23, 2008 1:53:21 PM

Uh Becky - McCain would not be able to play golf if he wanted to. He might be able to putt but that's about it. Obama on the other hand just may be playing basketball every day though.

Posted by: lori | Oct 23, 2008 1:54:20 PM

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