Kudlow: McCain Should Be Talking Cap Gains Tax Cuts

A great column by Larry Kudlow suggests that McCain should be reaching out directly to investors by talking about his 7.5 percent capital-gains tax cut and his $15,000 capital-loss tax deduction. Kudlow says he also needs to connect his tax cut proposals with middle class Main Street America...

But if Sen. McCain can get the capital-gains tax cut into his message, and if he can repackage the corporate tax cut as a Main Street tax benefit, he would stand a much better chance of getting his margins up with the heavy-voting investor class.

The just-released IBD/TIPP poll shows McCain has retaken the lead among investors with a small margin of 45-43 over Obama. Yesterday Obama was plus-2 among investors, and the day before he was plus-6. So something positive may be going on here for McCain.

Remember, Bush won investors by 11 points in 2004. And no Republican can win the presidency without a big investor vote margin. However, McCain is trailing Obama among married women, 46-42. He should be ahead by 10. And he’s only getting 65 percent of the conservative vote, whereas he should be getting 75 or more. Overall, IBD/TIPP has Obama plus 5.3, almost identical to the RealClear poll average of 5.2 percent. Rasmussen shows Obama at plus-4; Zogby has him plus-6; and Gallup has him plus-5.

So my advice to Sen. McCain is to start talking capital-gains tax cut to 7.5 percent. It’s a winner with the stock market sagging badly. Stocks will come back — in fact there’s a mini rally cooking right now. And a low cap-gains tax is a great incentive for investor-class wealth creation. Obama is going to penalize investors. But McCain will reward them.