The other issue that McCain keeps trumpeting, and that the mainstream press seems to be supporting him on (my only explanation is that they are thickheaded) is a budget freeze. As Yglesias puts it, "a lot of the press’ leading lights seem to think we ought to follow Herbert Hoover off the cliff. Everyone’s been living too high on the hog and we need to liquidate everything. Massive suffering will be good for us." The belief that reigning in government spending is what is going to get us out of the credit crisis is absurd. Again, from Yglesias:
Meanwhile, as you may have noticed, there’s a credit crunch afoot. A lot of people or business who might think they have solid ideas about how to invest some money in new production or sales are finding they can’t get the loans they need to do that. One of the few entities that still can easily raise large quantities of money on favorable terms is the federal government. If the feds don’t take up that opportunity and borrow cash that gets plowed into something or other, then there’s going to be no new economic activity at all. What we ought to be doing is debating not whether to spend, but what to spend the money on since, clearly, it’s much better to have the money spent on something useful than on something pointless.
The low-budget government mantra makes no sense. McCain likes to attack earmarks, and certainly there are absurd earmarks, but if we break down the budget (and our current deficit), it is not earmarks that are the problem. Indeed, many earmarks are very important, and provide good things: the earmark in the current bailout bill that provided funding for renewable energy, for example. But the budget problem is not one of earmarks. For starters, we have a 10 billion dollar-a-month war going on. Defense spending is ludicrous, and it is to McCain's credit that he offered to reign it in (unfortunate as it may be, given his record, that most of the budget cuts will probably be to veterans' affairs organizations and not to military spending).