Campaign '08

COLUMBIA, S.C. (CBS News) ― Concerns about the economy spread to the campaign trail in South Carolina Thursday as several Republican candidates talked about their plans for the economy and if they agree with calls in Washington for a short-term economic stimulus.

John McCain proposed a long-term economic plan that would lower the corporate income tax rate and provide a host of other tax breaks for business. "We will get through this rough patch, my friends," McCain told supporters.

The Republican presidential candidate proposed cutting the corporate tax rate to 25 percent from 35 percent. McCain, speaking to a rally under a tent in the rain, said that would expand the economy, creating jobs and opportunity.

He said his plan was "pro growth, less taxes and less spending." He contrasted it with "the Democrats' tired ideas of tax and spend."

Meanwhile, Fred Thompson made light of Federal Reserve Chairman Ben Bernanke's call for a quick economic stimulus Thursday and said it might be best to leave the economy alone for now.

"We're all concerned about the direction of the economy," said the former Tennessee senator. "We've had a good run, but we can't take growth for granted." He said "we've got to have a potential stimulus package on the table to be discussed if it would make sense to be used in short order, but we're not quite there yet."

And doing nothing might leave the economy stronger, he said.

"There's a case to be made for that," he said. "And it just requires strong heads at the table and not snap judgments, you know, by politicians on the road trying to think of something smart to say in 30 seconds."

McCain adviser Doug Holtz-Eakin suggested the Arizona senator also does not favor temporary relief at this time. "We haven't seen household declines in spending," he said.

McCain said, "It's not that I'm skeptical of short-term stimulus, I'm skeptical of any time you take taxpayers dollars without having a real good purpose and an object, Because somebody's got to pay it back.

"I want to see where that money's coming from," he added.

Among the other contenders in the South Carolina Republican primary Saturday, Mitt Romney said "it makes sense for Congress to take immediate action" and he'd have his own plan soon.

Bernanke today urged the government to adopt a plan quickly and make it temporary, and said "putting money into the hands of households and firms" would be more effective than measures such as making Bush's tax cuts permanent. President Bush also indicated support for a short-term boost.

McCain's economic plan would also establish a permanent research and development tax credit and allow tax breaks for equipment and technology investment. GOP rival Rudy Giuliani has also proposed cutting the corporate tax rate to 25 percent.

The McCain plan does not contain additional tax relief for individuals other than to renew a call to keep the expiring tax cuts passed by Congress in Bush's first term, a course also favored by others campaigning for the Republican nomination. "We've got to make these tax cuts permanent," McCain said.

"One of the reason we have the difficulties we do is that spending went out of control," McCain said.

McCain campaigned with Jack Kemp, a one-time star quarterback for the Buffalo Bills who represented New York in the House, served as housing secretary in the Reagan administration and was Bob Dole's vice presidential running mate in 1996. Kemp has long supported tax cuts as a way to stimulate business.

"John McCain knows we can prevent a recession," Kemp told the rally. "Everyone is talking about short-term stimulus. He wants long-term, pro-growth tax reform. I'm going to help him."

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