McCain vs. Obama on the Deficit and National Debt

WASHINGTON — Sometime next summer, the national debt will cross a mind-numbing threshold, topping $10 trillion — about $32,500 for every man, woman and child in the country.

This year, just paying the interest on the debt this year will cost taxpayers $232 billion, money not available for education, defense, health care or other national priorities.

Far from reversing the trend, the government continues to pile up debt by spending more than it takes in. The White House projected this week that next year's deficit will be $482 billion, a record amount.

Barack Obama has said he would reduce the annual budget deficits; John McCain has pledged to eliminate them. Neither, though, has put forth a credible plan for doing so, said Robert Bixby, executive director of the anti-deficit group the Concord Coalition.

"Under either plan, within four years, you're more likely to have about a $400 billion deficit than to have a balanced budget," Bixby said, although "they would get there through very different routes."

Here is a look at the candidates' fiscal policies:

OBAMA

Key Policies

— Reduce deficit spending to no more than $400 billion a year by 2013.

— End the war in Iraq, now costing taxpayers $10 billion a month.

— Offset $80 billion in new spending on health care, energy, the environment and education with savings in health care practices and other areas.

— Extend some tax cuts set to expire starting in 2010 while letting others expire. Compared to current tax policy, Obama's plan would increase revenues by a projected $800 billion over ten years, the Tax Policy Center estimates.

Record

Helped draft laws aimed at improving transparency of federal spending by making it subject to online searches. Has voted for so-called "pay-as-you-go" budget rules requiring Congress to offset spending increases with spending cuts or tax hikes.

In His Words

"You can't take out a credit card from the Bank of China in the name of our children and our grandchildren, and then say that you're cutting taxes. ... That is irresponsible. ... That is helping to undermine our economy."

MCCAIN

Key Policies

— Has pledged to eliminate the federal budget deficit by 2013.

— Has vowed to devote all savings from troop reductions in Iraq to deficit reduction.

— Has proposed making most expiring cuts permanent as part of a broader overhaul of tax policy. Compared to current tax policy, McCain's plan would reduce revenues by $600 billion over 10 years, the Tax Policy Center estimates, but McCain says making the tax cuts permanent would stimulate the economy, thereby increasing some tax revenues.

— Would freeze federal spending for one year, then seek a bipartisan deal to limit growth in federal spending to 2.4 percent per year, with the possible help of a bipartisan commission to suggest ways to root out waste and cut spending.

Record

McCain took a politically courageous stand against deficit spending in 2001, when he voted against the Bush-backed $1.3-trillion tax cut — one of just two senate Republicans to do so. Two years later, he voted against a second round of Bush tax cuts — this time worth $350 billion — on the eve of the invasion of Iraq. As a candidate, however, McCain has said he would make the tax cuts permanent. Has voted for "pay-as-you-go" in the past.

In His Words

"American workers and families pay their bills and balance their budgets, and I will demand the same of the government. A government that spends wisely and balances its budget is a catalyst for economic growth and the creation of good and secure jobs."