In the end the big question for John "no new taxes" McCain is how is he going to raise revenue in the absence of taxes in this recession where people are losing jobs? There are two answers to that:

1) there will not be any tax cuts because it is not affordable

or,

2) borrow money from other countries

Look we have been borrowing money from foreign countries all these years and as a result our national debt is running out and topping over $10 trillion. So how do you decrease that debt? Cut spending? What do we cut? Military spending, social security, medicare, medicaid...in other words all entitlement programs needs to be cut, the military budget drastically reduced. Is anyone ready for that? Guess not. So under the McCain plan we keep borrowing.

It is a very bad idea which even Alan Greenspan disagrees with:

The problem with McCain's rhetoric and the cognitive dissonance is that he just does not get it, that even with all the spending cuts he has to finance his tax cuts somehow and the ballooning deficit is more than an economic issue now...it is a national security issue. Last Sunday, Fareed Zakaria had an interesting discussion about this and I am posting an excerpt that had a very sobering effect on me:

BERGSTEN: The other element to add to the unsustainability of our current situation is that the foreigners have actually been paying, at the margin, most of the increase in our national borrowing. We've been borrowing half-a-trillion dollars or more per year from the rest of the world for the last five to 10 years.

That means the United States is now the world's largest debtor country.

Part of the pressure on the government here and the Federal Reserve to deal with our financial crisis has been the fear that our foreign creditors would bail out of the dollar, start dumping dollars. Fortunately, they have not done that. I think that can be avoided. But we have to retain their confidence even more than we have to retain confidence at home, because we put ourselves in the position of being in hock to the world.

That can't go on. We can't increase that further. We can't put ourselves more in debt to the rest of the world and lose control over our own destiny.

So, for that reason, as well, we've got to get real, as Jeff said, get our house in order. That's what it boils down to.

SACHS: Fred, I just wonder, because this will be a question facing the new president quite urgently. As much as I'd love to agree with you, and almost always do, a $1 trillion deficit is actually not going to be very much of a boost of confidence. And I am not so sure, in the kind of environment that we're in right now, that that's so easy to finance from external flows anymore, also.

ZAKARIA: So you're saying, no tax cuts. SACHS: You know, look, I'm the only one saying it, because everyone wants it, and everyone loves it. But, you know, if it's really a budget deficit at $800 billion or $1 trillion, and we're sitting there asking, OK, now another big tax cut on top of it, is that really going to be realistic?

Painful as it is to say, because no one wants to hear that, so it's not ...

ZAKARIA: Sebastian, where do you come down on this?

MALLABY: Well, I think we're caught between two distinct problems on the external financing side. On the one hand ...

ZAKARIA: External financing, just to explain, is we go out to the market, the United States government, and ask foreigners to buy about $4 billion of IOUs every day.

MALLABY: Right. And the point here is that it's foreigners buying these assets. And so, if they don't have faith in the credibility of American Treasury bonds or other financial assets - because a lot of the financing that went on, it was foreigners not buying American government debt, it was private debt. It was debt issued by Wall Street on behalf of companies, and so forth, including a lot of securitized mortgage assets.

And so, the argument in the past has been, look, foreigners buy this stuff, because they believe in the institutions on Wall Street. They believe in the credibility of American financial regulation. Now that that credibility has been shot in half, the question is: Will the foreigners continue to finance American borrowing needs?

And when you rely on governments, who have made a political decision to lend America money, those same governments could make a new political decision to stop lending America money.

So, without really realizing it, we've gotten ourselves into a position where we have a foreign policy liability. If China, which holds a lot of American debt, decided to sell it or to switch the debt into some other dollar instrument - for example, the equity market - it could disrupt our capital market, inflict a lot of pain on us.

And in a sort of extreme scenario, like a Taiwan crisis, or something like that, I think this becomes a foreign policy tool that we haven't begun to reckon with yet.

Sebastian Mallaby hits the nail on the head. It is no longer feasible to cut taxes by borrowing from foreign governments. It is time for the higher income bracket to do their bit of heavy lifting if only for national security reasons. Some might call that patriotic duty (yeah Republicans are all for patriotism as long as it does not hurt their pocketbook). Here I have to add too that over the last few days McCain has also ginned up talk of selling F-16s and missiles to Taiwan to contain China. So under. god-forbid, a McCain administration, China holds our debt, we borrow more money from China and at the same time we find more ways to alienate them. Talk about clueless senility.

In tomorrow's debate McCain will raise the Orwellian lie of Obama raising taxes, I hope Sen. Obama can counter it effectively linking national security to the economy because what McCain proposes is simply insane and/or Republican happy talk.