Obama and McCain have big economic differences

Obama and McCain have big economic differences

By MARTIN CRUTSINGER


WASHINGTON (AP) -- Job No. 1 for the next president? In the minds of an overwhelming number of Americans, it's fixing what ails the sick economy. What the voters will have to sort out are very different approaches offered by Barack Obama and John McCain.

Both of their fix-up plans rely heavily on tax cuts, but in sharply different ways that speak to the historic differences between Democrats and Republicans.

McCain, borrowing a page from Ronald Reagan and President Bush, would keep tax rates low for higher-income taxpayers and slash rates for corporations, arguing that this is the way to jump-start a lethargic economy and create more jobs.

Obama, focusing on a theme of many past Democratic campaigns, seeks to target his help to the squeezed middle class and address the growing income inequality between rich and poor. He would retain all of the Bush tax cuts for families making less than $250,000 a year, but would do away with Bush's cuts for people making more than that.

The money raised from tax increases on the wealthy would be redirected by Obama to tax relief for lower-income Americans.

Unlike a lot of campaign debates where the promises of neither side get enacted into law, this war of words will make a difference because all of Bush's tax cuts are scheduled to expire at the end of 2010.

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