It’s the Economy…Why McCain Lost

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As you approached the voting booth two weeks ago, what concerns were on your mind? If it was the economy, you were not alone. Six out of ten voters selected the economy as the number one issue facing our country. At the same time, none of the four other issues listed (Iraq, terrorism, energy, and health care) received more than one in ten votes.

Prior to the election, I wrote a post about how each candidate would affect our finances and the economy, if elected. My goal was to present clear, unbiased positions as presented by each candidate. An honest effort was made to dig deep into each campaign’s plan and present only the facts.

It became increasingly clear as my research progressed that Obama had provided a much more detailed plan regarding the measures he would take if elected. While Obama was bold and consistent in a time of needed change, McCain was uncertain, unclear, and grasping for themes and messages that would connect with the general populous (making him look more like ‘John the Snakeoil Salesman’ versus ‘John the Credible Presidential Candidate’).

Connecting with the Lower and Middle Classes

Where Obama really excelled over McCain in his campaign was with his ability to connect with common folk on the issues that matter the most to them, primarily the economy. Let’s look at how he was able to connect with this significant demographic in comparison to McCain. Obama seemed to have a clear edge on 4 out of the 7 major economic issues, while the other three were a push.

Tax Plans

Republicans claim to belong to the ‘party of lower taxation’. Obama sought to destroy this perception with the vote that mattered in this election. Obama’s tax plan was tactfully beneficial to 95% of the population, or all those making less than $250,000, effectively negating this historical Republican claim. At the same time, trickle down economics has left those below the elite thirsting for their fair share. Lately they’ve been parched dry. Advantage Obama.

Energy Expenses

Obama would like to provide a windfall oil profits refund of $1,000 to all taxpayers. McCain wanted to suspend the gas tax between Memorial and Labor Day. Which of these options gives you an exact dollar amount that will end up in your pocket, is more, and sticks it to the big corporations that have been taking it to the little guy in recent years? Advantage Obama.

College Loans & Expenses

Obama wants to provide a $4,000 annual credit towards college expenses in exchange for community service. McCain had laid out zero details on how he would assist students and their families in paying for college. Advantage Obama.

Homes & Mortgages

Obama would give everyone a ‘universal mortgage credit’ of 10%, which would directly impact two-thirds of homeowners who don’t itemize their taxes. McCain wanted to help those with troubled mortgages refinance. Obama’s plan would affect more people, but not ‘save’ many from the impending loss of their homes. McCain’s would save many, but provide no reward for those who have stayed up-to-date on their payments. Push.

Health Care

Obama’s plan offers health care coverage for all, including those who were denied coverage previously. McCain’s offered a $2,500 tax credit per taxpayer. Both sides could argue which plan would be more effective in the short and long term, but the effect of Obama’s plan was much more transparent to the common voter. ‘I could lose my job and still have coverage?’ ‘I have cancer and can get coverage for the first time in a long time?’. Advantage Obama.

Investing & Retirement

Obama will raise the capital gains tax on those making over $250,000 from 15 to 25%. McCain would keep the tax at 15% for everyone. McCain’s strategy here did cater to 5% more of the population than Obama’s, but at the same time the other 95% of the population doesn’t mind seeing the elite pay a little more on their capital gains. Push.

Job Creation

Obama wants to build economic activity from the ground up as his plan includes infrastructure and alternative energy investments to create new jobs. McCain’s plan was to cut the corporate tax rate from 35 to 25%. I’m going to give this one a push, because arguments could be made for each side and I don’t think that it was a deal maker or breaker in either direction. My thoughts are that building the economy from the ground up has and always will be a larger generator of economic growth (especially when you consider that most corporations find ways to avoid any taxation). However, I’m not sure if this was the majority perception on a national scale. Push.

It Must Have Been Bush, Right?

Many Republican’s have been choosing (or would like others) to believe that Obama did not earn his victory. Rather, they insist that President Bush lost the election for McCain. Undoubtedly, Bush’s track record as President probably did not earn any new voters for the Republican party. At the same time, credit must be given where credit is due. Obama ran a masterful campaign with consistent messaging, detailed plans, and the promise of hope.

What’s Next?

Obama is certainly not in a position of envy with all the work that must be done in order to get this economy back on track. All we can do is hope that he sticks to the bold claims that won him this election and give him a fair and honest shot to make his mark. In a time like this, we must ignore our philosophical divisions and join together to make a positive impact for the sake of our country’s future.

For more of GE Miller’s writing, see 20somethingfinance.com