Kerry's class warfare: Wrong war, wrong enemy, wrong means

Jack Kemp
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Posted: Oct 05, 2004 12:00 AM

I agree with Bill Bennett's description of the first presidential debate on Sept. 30, which centered on foreign policy, the war in Iraq and the war on terrorism: "John Kerry won the debate, but President Bush won the argument."

Winning the argument, however, is not enough since by losing the debate the race has tightened considerably. The good news for Bush is that former presidents have a long history of losing their first debate but coming back to win the election - Reagan against Mondale, Bush senior against Dukakis, Clinton against Perot and Bush senior.

The not-so-good news for George W. Bush is that on domestic policy, on which the next two debates will focus and where the president clearly has the better case, Sen. Kerry still seems to be winning the argument in the minds of the American people, if one can believe the polls.

According to pollster John Zogby, "Only 16 percent to 20 percent of undecided voters (which he places at no more than about 6 million people nationwide) feel that the president deserves to be re-elected." Zogby finds that while undecided voters "agree with President Bush on values, leadership, the war on terror and likability, they prefer Mr. Kerry on the economy, health care, the war (in Iraq) and education."

The most recent Newsweek poll (conducted between Sept. 30 and Oct. 2), which showed the candidates' foreign-policy debate performances erased a 7 percentage-point Bush advantage and vaulted Kerry into a 3-point lead, scores the senator even better against the president on the economy (52 percent vs. 39 percent); health care, including Medicare (56 percent to 34 percent); and American jobs and foreign competition (54 percent vs. 36 percent).

So winning the second and third debates is necessary but not sufficient if Bush is to win in November. He also has to win the argument, and it will take more than brushed-up debating skills to do so. It will also require a sharply honed presentation of economic substance to change the minds of those skeptical undecided voters predisposed against him.

The key to the president's winning both the debate and the argument on pocketbook issues is for him to lay out in a simple, straightforward fashion how his tax policies are fostering economic growth and prosperity and why Kerry's obsession with class warfare will create economic hardship for the middle class and erect roadblocks to entry into the middle class for poor people. He could start by explaining that whenever politicians aim at the rich, they always hit the middle class and crush the poor.

The Bush tax-rate reductions aren't about putting money into anyone's pockets, certainly not the pockets of the rich. The tax-rate reductions and the tax reforms the president has gotten enacted into law are all about creating incentives to work, save, invest and take entrepreneurial risks.

It's impossible to help the poor by punishing the rich because the poor need access to capital, which the rich own, and the productivity-enhancing machinery and software it produces. Injure capital and you incapacitate labor. Stifle capital formation and you smother job creation.

Taxing capital, raising tax rates on individuals earning more than $200,000 and punishing American firms doing business abroad, all of which Kerry proposes, won't take money out of the pockets of rich people; it will destroy the jobs of working people. It will cripple entrepreneurial risk-taking and prevent tomorrow's jobs from ever being created, and it will do serious harm to most small businesses (which create two-thirds of the new private-sector jobs in this country), 70 percent of whose owners might appear "rich" on paper because they file tax returns as individuals, not corporations.

The proof is in the pudding, and the economic pudding has clearly gelled. The government recently revised second-quarter GDP growth up to 3.3 percent from an earlier reported 2.8 percent. Third-quarter economic growth may actually have hit 5 percent and shows no indication of slowing down. Since the second quarter of 2003, inflation-adjusted economic growth has averaged 4.7 percent, 42 percent higher than the 40-year average growth rate of 3.3 percent. And growth is translating into more personal prosperity. Year over year, personal income growth is up 5 percent, and wage and salary income is up 4.6 percent.

As for jobs, don't believe the gloom and doom coming out of the Kerry campaign.
Unemployment, at 5.4 percent, is lower than the 5.8 percent rate it averaged during the 1990s, and new jobs and new business ventures are being created at a rapid rate.

The rich aren't the enemy of the working man; it's the stupid tax, regulatory and trade policies emanating from Washington that threaten working and middle-class Americans. That's the case the president has to make in the next debate, and it's a strong case because the facts and economic theory both are on his side.