GOP is cool to McCain’s economics

Sen. John McCain’s (Ariz.) ideas for resuscitating the sagging economy have been greeted coolly by some of his fellow Republicans, spotlighting the challenge of coordinating a campaign message with the agendas on Capitol Hill.

While generally supportive, Republicans in both chambers are split on some of the details, including a plan to stem the tide of foreclosures and another creating a summer gas-tax holiday.

{mosads}McCain’s campaign spent some time briefing House Republicans prior to Tuesday’s speech. But he made a more limited effort with his colleagues in the upper chamber, where he has served for four terms.

Senate Republican leaders dismissed suggestions that there was poor coordination between them and the campaign on April 15, the deadline to file income taxes and a day when the GOP was eager to crow about lower taxes. Some of his closest allies even say the silence might have been strategic.

Still, as the agenda setter for his party, McCain’s plan received little attention from GOP lawmakers even though it was considered the senator’s biggest speech on the economy thus far.

McCain, an Arizona Republican, offered a sweeping economic proposal in Pittsburgh, backing more than $200 billion annually in new tax breaks. His plan includes $65 billion in cuts to unspecified domestic programs, a decrease in the corporate tax rate from 35 percent to 25 percent, and a summer gas-tax holiday.

When asked Tuesday for his reaction, Senate Minority Leader Mitch McConnell (R-Ky.) said he was in the process of receiving the details of the gas-tax plan.

“Well, I just heard about it,” McConnell said at a news conference touting GOP tax policy. “We’ll be thinking about it and see if it has any merit.”

Sen. Lamar Alexander (Tenn.), who serves as the third-ranking Republican in the chamber, said he supports elements of McCain’s plan, including the reduction of the corporate tax rate. But he opposes the gas-tax holiday because it would reduce money going to the highway trust fund, which provides money to local projects.

“I don’t like that proposal on the gas tax,” Alexander said, saying it takes money away from programs for transportation projects, including easing traffic congestion.

But Alexander didn’t raise concerns about being kept out of the loop.

“He’s entitled to make his own statements — as I said, I agree with him on the bulk of what he said [Tuesday], but I don’t agree with him on that,” said Alexander, who ran for the GOP presidential nomination in 1996 and 2000. “It won’t be possible to have a comprehensive clearing process with members of Congress on everything he says.”

McCain’s campaign advisers spent time with senators earlier this month at a closed-door luncheon, saying that the door was open for communication on strategy between the two sides.

“Members of the Senate were briefed about the McCain speech,” said McCain spokeswoman Crystal Benton. “Certainly we will continue to reach out on a regular basis in advance of major policy rollouts to members.

A campaign aide said that some senators in key positions received briefings of his plans.

In the House, McCain advisers met with top GOP staff last Friday, with several GOP members on Monday and with the Republican whip team Tuesday.

Some have already started to talk about McCain’s plans.

Speaking to reporters on Wednesday, Rep. Eric Cantor (R-Va.) expressed confidence that House GOP lawmakers would support McCain’s plan to allow people who have sub-prime mortgages on their primary residences to apply for federal aid. If approved, the borrower would have a new 30-year fixed rate loan, 80 percent of which would be backed by the government.

McCain’s proposal also calls for the Justice Department to investigate potentially unfair lending practices. The proposal is estimated to cost between $3 billion and $10 billion.

“Certainly, in the housing [plan] we will have Republicans supporting what John McCain has offered,” Cantor said, adding that taxpayers will not be saddled with the cost of other taxpayers’ foreclosures.

However, other Republicans are not so sure. Rep. Tom Feeney (R-Fla.) said the unpredictable market made it unclear whether the burden could shift to the taxpayer if the housing market does not rebound quickly.

“In a worst-case scenario, what would the taxpayer liability be?” Feeney said.

Feeney, whose state has been hit hard by foreclosures after an explosion of real estate speculating in central Florida, said that some of the principles were attractive, such as focusing away from lenders and those borrowers who speculated poorly on real estate.

Rep. Steve Chabot (R-Ohio), who has co-sponsored legislation that would help those who file for bankruptcy and lack the resources to pay their expenses, said he was encouraged by McCain’s proposal and commended him on the effort.

“My principal concern between his plan and [the bill he co-sponsored] is that his plan would cost taxpayers somewhere between $3 billion and $10 billion,” Chabot said, adding the bill backed by him and Judiciary Committee Chairman John Conyers Jr. (D-Mich.) does not include a tax burden.

“I like that [McCain’s proposal] includes the investigation of criminal activity with predatory lending.”

On the Senate side, Lindsey Graham (R-S.C.) suggested that it might have been a strategic move not to brief the conference.

“One thing about telling a bunch of people is that you read about it in the news before you make the news,” Graham said.

Graham, McCain’s closest Hill ally and a liaison between congressional leadership and the campaign, said he “feels good” about the coordination between the two sides.

“I don’t think we’re going to be able to sit down every time John talks about a national security issue or an economic issue,” Graham said.

McCain’s fellow Arizona Republican, Senate Minority Whip Jon Kyl, said, even though the conference was not briefed, there is regular and daily communication between the campaign, saying he spoke with the senator last Saturday about President Bush’s judicial nominees.

“You’re not going to see us have exactly the same message every single day, but there is a lot of coordination between us,” Kyl said.