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A government big enough to give you everything you want, is strong enough to take everything you have! - Thomas Jefferson

Thursday, September 18, 2008

McCain-Palin Campaign Conference Call On Barack Obama's Failed Economic Leadership

"And though, the pitch has been strong and its been eloquent, the facts are that he was the number two recipient of the money he has suggested bought off the legislative process in Washington from adopting the types of regulations that Freddie and Fannie needed to oversee the products that didn't exist when the original regulation was structured. ... Not only was it campaign contributions, it was former heads of those companies that were selected to head that vice presidential selection team for Barack Obama." -- Senator Richard Burr (R-NC)

Today, the McCain-Palin campaign held a press conference call with Senator Richard Burr (R-NC), Representative Eric Cantor (R-VA) and Doug Holtz-Eakin, McCain-Palin senior policy adviser, on Barack Obama's failed economic leadership:

Doug Holtz-Eakin: "I want to focus my remarks about Barack Obama's economic capabilities as a leader, on his promise to the middle class Americans for a tax cut and what should they really expect. I think the first thing one should be quite honest about is he has no credibility in his comments. This is the man who voted for higher taxes 94 times in the U.S. Senate -- 94 times he had the opportunity to either keep taxes where they were or lower them for middle class Americans; he did not. He then entered into a presidential campaign where he ran as an advocate for higher taxes in the primary. He, in the primary for example, said we're going to get rid of the cap on the taxing the maximum Social Security and subject all of that to a 12.4% tax. It became apparent after he won the nomination, that that was an agenda that is not possible with Americans. So very quickly he said no, no I didn't mean that, I mean anyone who is making over $250,000 I'll raise tax for that and then he said no, no I didn't mean that, I'm going to tax those people who are making more than $250,000 a 4-5% rate. Oh no I didn't mean that, I'm going to do it in 10 years.

"So he has changed that story from an immediate increase, the largest tax increase in American history, to something that he won't do for 10 years, when he would be out of office if he were so fortunate to be elected. That is absolutely the character of what his tax proposals have been in this campaign. He was going to raise taxes on dividends and capital gains and when the bad impact it would have on small businesses he immediately said no, no I'm going to have a zero tax rate for start ups. Start ups don't have capital gains. They're start ups. He has continually shifted to the point where his economic advice most recently said on CNBC, 'We never meant to raise taxes. We're going to wait a couple years. We've always said that.'

"They have said so many things throughout the campaign It is clear that Barack Obama on taxes will say anything that is politically expedient including I will cut taxes for 95% of Americans. The fact is he has promised so much spending it would be impossible for those tax cuts to take place. He has proposed over $800 billion worth of increases in spending and that excludes a recent independent estimate of his healthcare plan which would cost over $240 billion a year alone. It is an inconceivable matter of arithmetic in modern financial markets that he could cut taxes and follow through on the spending promises he made. So there is no credibility in this package.

"And finally we can take this at face value, that he says, 'I am going to raise the top marginal tax, I'm going to increase taxes on dividends and capital gains and then I'm going to do a variety of other things including tax credit that he's proposed.' What will you have: you will have higher taxes on small businesses at a time when firms under 50 employees have created 330,000 jobs in this economy -- an economy starving for some vitality. He will raise taxes on the one source of economic vitality. In an economy where the capital markets are struggling, he will raise taxes on dividends and capital gains. The reason people hold stocks is the dividends and capital gains. If you raise the taxes on them, they will not want to hold stocks and Barack Obama will take the stock market that has dropped by 900 points in two days this week and drive it further south.

What's the net result? Take it at face value, he's going to say you can have a $500 tax credit, but I don't think Americans are going to be too happy with that when they don't have a job and they don't have a pension. This is a very bad combination. His running mate recently said higher taxes are patriotic. This is an economy that is struggling, higher taxes aren't patriotic. They're bad tax policy."


Rep. Eric Cantor (R-VA): "Obviously, as Doug has said, our capital markets continue to broil unpredictably. I think there's clearly a significant amount of turmoil. And the impact on American families is really unknown and is yet to be felt. But this is the time that the country and the people of America really need to see leadership. And I don't know that we've heard any position articulated by Barack Obama, on the situation surrounding AIG up until last night. And even this morning, I think we are very unclear as to where Barack Obama is on the issue of AIG.
"We don't know where he is. And I think it's clearly demonstrating that Barack Obama trying to vote present while we're in an economic crisis, yet again. It seems that this is a pattern of his behavior in the legislative body in Illinois, certainly in the Senate repeated and now in his candidacy for the presidency. He once again cannot come down on an issue that is going to have such an impact, and it already has, on millions of Americans.

"And I think you have also heard from John McCain that, look this is an extremely upsetting and disappointing situation. That I don't think anyone likes to put taxpayer dollars into a private entity, but the way that this has been done It has been done to protect taxpayer dollars. Frankly, taxpayer dollars will hopefully come back to the federal government ant then the taxpayers. This is a loan to AIG, not a bail out.

"There is control now that has been asserted over the company so that no dividends can be paid to shareholders. So that taxpayers will be paid back first. This is the kind of leadership. This is the kind of behavior that I think people expect from leaders. When you compare what John McCain has said and done on this versus an extremely unclear and vague position -- if there even is a position on the part of Barack Obama -- I think it also indicates a very cloudy leadership on his part."
Senator Richard Burr (R-NC): "I think it's safe to say that this is an election that I personally believe will be decided based upon leadership. And I think the American people are looking at everything that happens right now and looking at two individuals trying to decide, 'is this the type of leadership I want, not only in the White House, but as commander-in-chief?' I think that the American people expect a good leader to lead by example.
"And I think, as Eric alluded to, to take no positions on whether intervention in AIG was needed displays a lot to the American people. It doesn't recognize the fact that AIG has 74 million customers, and that they operate in 138 countries, and that they have a trillion dollars worth of assets, and that if you allow that to go away, not only is there an employment hit to the American people, there is a disruption in international marketplace that takes what is ripples today and it creates waves that will capsize other companies that today are in fact not necessarily in trouble.

"From standpoint of setting the example, one needs only to look at the Freddie and Fannie challenges and the government response, and the fact Barack Obama was the second largest recipient of campaign contributions from Freddie and Fannie. It's not good enough to go out and just talk about reform and to talk about change. The American people are going to hold these candidates to their actions. And though, the pitch has been strong and its been eloquent, the facts are that he was the number two recipient of the money he has suggested bought off the legislative process in Washington from adopting the types of regulations that Freddie and Fannie needed to oversee the products that didn't exist when the original regulation was structured. It is absolutely essential that Freddie and Fannie in the new world that they will go into are under a different type of regulation that regulates new products. The question is can you accomplish that with somebody tha t is so indebted to those. Not only was it campaign contributions, it was former heads of those companies that were selected to head that vice presidential selection team for Barack Obama. It was the campaign adviser, Frank Raines, who walked away from that company several years ago, with over $90 million of a golden parachute that Barack Obama has criticized regularly throughout the marketplace, that these things shouldn't exist.

"Clearly this is an election about leadership. It is an understanding that the financial markets continue to change and that we need not only a leader that's willing to surround himself with the right types of experts, but a leader that is willing to make a decision in short order based upon what's in the best interest of the American people."
Setting The Record Straight: Deregulation

Doug Holtz-Eakin: "Let me make the observation that the crucial issue that presents the candidates is the future of financial regulation. And in Larry Summers and Robert Rubin, Barack Obama has the two Treasury Secretaries who sheparded through the Gramm-Leach-Bliley legislation that they are now attacking as the source of all the problems on Wall Street that was signed by then-President Clinton. Obama adviser Gene Sperling was praised for his work on the legislation, so the quality of the advice that he's receiving, we have a track record on that.

"John McCain has a track record as well. He is a man who in 2003 said we need to reform Fannie Mae and Freddie Mac, these are threats to the U.S. taxpayer. They are threats to financial markets. They need to have a different regulatory structure, a strong office in the Treasury. It didn't happen. He tried again in 2005, repeated his warnings. What we now have are taxpayers owning an institution with $5.6 trillion in liability and a track record of sorry management performance, manipulation of earnings statements, and CEO's leaving in disgrace."

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