McCain's Economic Policy

McCain's op-ed in today's Financial Times provides a look into what his economic policy team has in mind:

"The world made the grave error of building walls against trade 75 years ago and it contributed to the Great Depression. Since that time, the US has been in the forefront of the fight for reduced barriers to trade and has reaped the benefits of sustained growth in standards of living, an awesome display of innovation and technical advance, an explosion in the variety, quality and affordability of consumer goods, a rise in home ownership, and ascendancy to become the world’s greatest economy.

But we must also face the fact that opening new and integrated world markets won’t automatically translate into higher quality of life for every American. It is government’s job to help workers get education and training. Instead we have outmoded and redundant training programmes and nobody in government bothers to check whether they work. This is unacceptable. We have an obligation to deliver a single, effective system for assistance, training and relocation.

Low, efficient taxes and open, level global markets are central to success, but both are threatened if reckless government spending is allowed to continue. An economy cannot be economically free if it is festooned with massive government spending."

Although it's not surprising that a conservative candidate is championing lower taxes and "economic freedom", his mention of reexamining programs to help and/or retrain displaced workers is telling. Presumably, this means that McCain plans on overhauling trade adjustment assistance, which is designed to provide unemployed benefits and retraining/job search assistance to displaced workers, but is, for the most part, badly underutilized - most workers don't know about it or don't bother to use the services it provides. In the past, the Bush administration has been accused for purposefully making it difficult for unemployed workers to access the services provided for by the program.

Here is the GAO report that takes a close look at the problems with TAA. Also, an IIE paper that offers specific proposals for improving the program.