According a Forbes article, McCain's economic advisor suggests that he will pay for a corporate tax cut by cutting defense spending:
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.
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.