Election Issues: Economy

John McCain and Barack Obama each offer traditional Republican and Democratic economic platforms, reprising a philosophical debate as old as the Union about the role of the federal government in the nation’s economy. Barack Obama believes in an active federal government that invests in the country’s infrastructure and economic future. John McCain argues that government spending is out of control in Washington, and that the federal government needs to take a much more limited role in local projects. Explore the differences in their policies at PBS.org.

Barack Obama spoke with The Wall Street Journal in an extensive interview about the role of the federal government in the economy—he expressed his belief in infrastructure investment as a means for economic growth.

The Wall Street Journal also provides an overview of John McCain’s economic platform. The article examines the philosophical underpinnings of his policies, and his anger over governmental and corporate excess.

Obama favors a tax cut for working and middle class families. His campaign says, “Obama will restore fairness to the tax code and provide 150 million workers the tax relief they need. Obama will create a new ‘Making Work Pay’ tax credit of up to $500 per person, or $1,000 per working family. The ‘Making Work Pay’ tax credit will completely eliminate income taxes for 10 million Americans.” 

McCain favors a top-down tax plan. He believes tax cuts for those in higher income tax brackets will stimulate spending and investment, create jobs and fuel the economy. He says, “Entrepreneurs are at the heart of American innovation, growth and prosperity. Entrepreneurs create the ultimate job security—a new, better opportunity if your current job goes away. Entrepreneurs should not be taxed into submission … Small businesses are the heart of job growth; raising taxes on them hurts every worker.”

For a more detailed analysis, consult the nonpartisan Tax Policy Center's evaluation and breakdown of the respective plans.

The fight over free trade between Senator Clinton and Senator Obama during the Democratic primary has spilled over into the general election. Barack Obama is against free trade agreements such as NAFTA unless they provide better labor and environmental standards. John McCain believes free trade agreements as they currently exist help the American worker and consumer. Although intended for readers abroad, the German Marshall Fund provides a well-balanced description of their positions on the issue.

For more information on the economy read findingDulcinea's U.S. Economy Web Guide.