It may seem hard to believe, but John McCain is actually intent on making Still-President Bush look fiscally responsible. Given that Bush has added trillions to the debt, run the largest deficits in U.S. history, and is the first president to ever put the costs of a war on the national charge card, that’s no small feat.

But McCain is giving it a shot anyway, most notably when it comes to tax cuts. He wants to take the Bush tax cuts (which McCain originally voted against) and make them permanent, on top of slashing the corporate income-tax rate from 35% to 25%. In all, according to the McCain campaign and the Congressional Budget Office, McCain’s plan would cost an additional $400 billion a year (at a time of already huge budget deficits), and at the same time, the senator has also vowed to balance the federal budget by the end of his first term.

The trick, of course, is figuring out how to pay for all of these new tax cuts. Originally, McCain said he could achieve this by eliminating earmarks. Ultimately, though, the campaign could only identify about $18 billion in cuts — which may sound like a lot, but pales in comparison to tax cuts with a $2 trillion price tag.

So, the McCain gang has rolled out rationalization #2.

McCain’s top economic adviser, Doug Holtz-Eakin, blithely supposes that cuts in defense spending could make up for reducing the corporate tax rate from 35% to 25% and the subsequent shrinkage in federal revenues. Get that? The national security candidate wants to cut spending on our national security. Wait until the generals and the admirals hear that.

Wait, McCain wants to cut the Pentagon budget? Since when?

Chris Bowers noted:

If true, this would be a much bigger bombshell that McCain’s remarks on Iraq withdrawal. Unlike Forbes, it isn’t the hypocrisy of being “tough” on national security while suggesting cuts in defense spending that would be a big deal. Instead, it would be a big deal because it has the potential to create a bi-partisan consensus in this election on the need to cut the defense budget in 2009.

Obama should jump all over this, and argue that if we are going to cut defense spending, it should not be to pay for a corporate tax break, but instead to invest in American infrastructure, health care, and a new energy economy. He should also argue that McCain won’t actually cut defense spending, because his refusal to withdraw from Iraq would make a reduction in defense spending impossible.

Quite right. McCain’s stated position is that he intends to increase the size of the military, while fighting indefinitely in Iraq. And he’s going to do this while slashing spending for the Defense Department? How’s that, exactly?

What’s more, while the McCain campaign is talking about the savings associated with cuts to the Pentagon budget, the same McCain campaign is talking about increasing the size of the Pentagon budget.

Along with more personnel, our military needs additional equipment in order to make up for its recent losses and modernize. We can partially offset some of this additional investment by cutting wasteful spending. But we can also afford to spend more on national defense, which currently consumes less than four cents of every dollar that our economy generates — far less than what we spent during the Cold War. We must also accelerate the transformation of our military, which is still configured to fight enemies that no longer exist.

As Matt Yglesias noted, “So on the one hand, defense cuts will pay for tax cuts. But on the other hand, we need to substantial increase defense spending as a share of GDP to something more like Cold War levels.”

I know there are some who consider McCain a credible, knowledgeable guy. I just can’t figure out why.