The Wall Street Journal has a nice back-and-forth between the campaign's economic advisers here. The best parts are the discussion on energy policy and taxes, particularly Jason's spirited argument that the capital gains and dividend tax rates Obama is proposing would not be a drag on growth:
Barack Obama has proposed establishing a new tax bracket for capital gains and dividends for families making over $250,000. This bracket would be somewhere between 20 and 28 percent, although Obama has said that he believes that he will be able to propose something at or close to 20 percent. Not only would 98 percent of the population see their tax rates unchanged by this proposals, but Obama is also proposing to entirely eliminate capital gains taxes for small businesses and start-ups. And to put the impact of the proposal on the top 2 percent of households in perspective, at a 20 percent rate for capital gains and dividends:
–The dividend rate would be 39 percent below what President Bush proposed in his 2001 tax cut and lower than all but 5 of the last 92 years;
–The capital gains rate would be the same as what President Bush proposed in his 2001 tax cut, 29 percent below what Ronald Reagan raised it too, and 22 percent below the post-war average
–Taken together with Obama’s other proposals, 100 percent of households would pay lower taxes than they did in the 1990s.
These rates are perfectly compatible with strong economic growth and strong asset market growth. The stock market rose 270 percent in the decade following Ronald Reagan’s increase of the rate to 28 percent (which exceeds the rate that Obama would likely propose). The economy created 23 million jobs in the 1990s, a period when capital gains and dividend taxes were well above the levels that Senator Obama proposes.