McCain's Brain

He emphasizes the need to cut government spending. What are the programs in his crosshairs?
The easy place to start is you look at the earmarks. As of about 2006, earmark spending cost about $60 billion. He believes you should simply take that money out. You should allow no new earmarks. Not because that solves your budgetary problems. It doesn't. But because by making it clear that you're no longer taking care of the special interests, you'll be able to do the harder cuts that will be necessary ... You look at the defense side, too. We have a lot of weapons systems that may or may not fit the strategic aims of the United States. We should spend only on those things that match our mission objectives, and certainly we ought to be able to buy them in ways that don't suffer the cost overruns we've seen. And you and I have talked about entitlements. That's a big chunk of the money. You can't ignore that.

Something like 44 percent of federal spending goes to entitlements now?
It's on track within a 10-year window to be more than half of federal spending. You just can't ignore it.

On energy, Senator McCain has promised to make the U.S. "oil independent" within five years. I'd say most if not all experts would regard that as extremely unlikely, if not preposterous.
I think the careful way to say that is [that we should] be independent of the insecurity that comes from importing oil from places like Venezuela, Russia-where the assault on democracy continues-and from the Middle East, which is an unstable region. The goal is to put in place a cap-and-trade program, which has climate objectives but which also will shift the energy demands away from carbon-based petroleum fuels. That should reduce imports. We have to work aggressively at domestic alternatives, and the market will do this if oil is less desirable. And he would allow nuclear energy to happen, alternative fuels, all the renewables.

But do you really think that we could be independent of our need for oil from the Middle East, Russia and Venezuela within five years?
We're spending $400 billion a year [on oil imports]. If we could dramatically change the transportation sector-that's the key.

Sorry, dramatically change the transportation sector?
You're going to have to take a big cut at that. We'll still import oil, but we want to reduce the exposure to these places that really are a threat.

But you don't really think that we'd be independent of them within five years.
No.

So why did he say that?
I think it was in one debate. He said it quickly. There are lots of qualifiers that get left out when you're in a rush.

We've talked a little bit about the political vulnerabilities in some of the things that Senator McCain has said. What are the vulnerabilities on the Democratic side? Where would you criticize economic proposals by Hillary Clinton and Barack Obama?
I think there are lots of places of big disagreement. Number one is their basic outlook for the federal budget. They're promising lots and lots of new spending, and totaling it up will take time. We're trying to add it up now, and I don't have a number yet. But their promises are extraordinary. And so they're going to raise taxes and raise spending at a time when it's clearly detrimental to raise taxes, and we're already spending too much. Their approach to health-care reform really is a heavy government intrusion and doesn't deal with the underlying cost growth, so in the end will not be sustainable. I don't think they're on the right path on trade. The Democratic Party has become the party of protectionism, and that's a route to failure when 95 percent of the world's customers are outside of our borders. We need to be securing access to those customers for our kids and for the global success of the business community. Education will be a big issue, and what I hear them saying is that they'll put more money into failed systems instead of reforming them. So I think there are lots of points of contrast on domestic policy. And the top-line contrast is on foreign policy and national security, where John McCain's the clear expert, the person who's got the experience to do things right. And they've been on the wrong side of most of the issues.

Which of the Democratic candidates in your view is more vulnerable?
We run very well against either. They're a little bit different, but they share enough in common that the same script pretty much holds. In the end, they're both liberal senators, and have records to match.

© 2008