McCain Unveils Ambitious Economic Plan.--

I am surprised by the aggressiveness of McCain's economic plans:

In his most wide-ranging speech on the economy, presumptive Republican nominee John McCain on Tuesday laid out an agenda that would change the tax code, freeze discretionary spending and temporarily suspend federal gas taxes. . . .

McCain, with the exception of military spending and veterans' benefits, called for a one-year freeze on the amount of money Congress allocates to discretionary programs.

"'Discretionary spending' is a term people throw around a lot in Washington, while actual discretion is seldom exercised. Instead, every program comes with a built-in assumption that it should go on forever, and its budget increase forever. My administration will change that way of thinking," McCain said.

Taxes: Time for a new system

In terms of taxes, McCain will make several proposals. Taking a page from the book of former Republican candidate Fred Thompson, McCain said he would offer an alternative tax system that would consist of just two tax rates and a larger standard deduction than under the current code. Tax filers would be allowed to choose whether they wished to file under the current system or the new one. . . .

McCain also proposed phasing out the Alternative Minimum Tax and boosting the dependent child exemption from $3,500 to $7,000 per child.

For corporations, he said he would seek to lower the top corporate tax rate from 35% to 25%.

Oil, loans and jobs

In a proposal sure to get the most attention in the near-term given record-setting oil prices, McCain proposed a suspension of the federal gas tax from Memorial Day to Labor Day - traditionally the heaviest season for driving. At just over 18 cents per gallon, that would save the average driver about $2.35 every time he fills up his tank. . .

He also proposed that unemployment insurance taxes be used to build "a buffer account" for each worker, which he could draw on directly if he loses his job.

"We have an unemployment insurance program straight out of the 1950s. It was designed to assist workers through a few tough months during an economic downturn until their old jobs came back. That program has no relevance to the world we live in today," McCain said.

There is plenty for supporters to get excited about and for opponents to attack. In particular, expect complaints that McCain wants to privatize unemployment insurance.

And the best way to lower gas prices a dime or so would be for the government to suspend purchases for our strategic petroleum reserves and to reduce greatly the size of those reserves.