Romney’s Bad Math: What Specifics, “I’m Running For President For Pete’s Sake”
Speaking at a closed-press fundraiser in Palm Beach, Florida, on Sunday night, Mitt Romney offered more details than he ever has to date on what he might do about federal spending and taxes. Luckily, some reporters standing outside overheard him. NBC reports:
“I’m going to take a lot of departments in Washington, and agencies, and combine them. Some eliminate, but I’m probably not going to lay out just exactly which ones are going to go,” Romney said. “Things like Housing and Urban Development, which my dad was head of, that might not be around later. But I’m not going to actually go through these one by one. What I can tell you is, we’ve got far too many bureaucrats. I will send a lot of what happens in Washington back to the states.”
Asked about the fate of the Department of Education in a potential Romney administration, the former governor suggested it would also face a dramatic restructuring.
“The Department of Education: I will either consolidate with another agency, or perhaps make it a heck of a lot smaller. I’m not going to get rid of it entirely,” Romney said, explaining that part of his reasoning behind preserving the agency was to maintain a federal role in pushing back against teachers’ unions. Romney added that he learned in his 1994 campaign for Senate that proposing to eliminate the agency was politically volatile.
Romney expounded on that lesson—that he shouldn’t publicly admit to his plans to leave society’s most vulnerable citizens without any federal support—in a March interview with told The Weekly Standard. “One of the things I found in a short campaign against Ted Kennedy was that when I said, for instance, that I wanted to eliminate the Department of Education, that was used to suggest I don’t care about education,” said Romney. “So will there be some that get eliminated or combined? The answer is yes, but I’m not going to give you a list right now.” In other words, Romney believes that if he tells the public what he might actually do in office they will dislike his plans and reject them. This is just as revealing as Romney’s infamous recollection that he told his gardener not to use illegal immigrants on his property because “I’m running for office for Pete’s sake.” Romney doesn’t want to wage an honest contest between his ideas and his opponent’s. His self-described preference is to try to win by telling the American they can have tax cuts without painful sacrifices on spending.
Publicly, Romney has proposed to make the Bush tax cuts permanent and to then cut taxes further. He also wants to increase defense spending. In total he would reduce federal tax revenues by $5 billion over the next ten years. The Committee for a Responsible Budget estimated that Romney would add $2.6 trillion to the deficit. He has promised to cut spending as well, but he has avoided mentioning credible specifics.
That’s bad enough. But what is even worse is that what he offers in private doesn’t add up either. It would be one thing if Romney had a secret plan to balance the budget with drastic spending cuts to major federal programs. While it would be dishonorable of him to refuse to discuss that plan while running for president, at least you would know he has a plausible—if totally heartless—plan for governing once elected.
But he doesn’t. Instead the new details he offered were that he might eliminate the mortgage interest deduction on second homes and abolish the Department of Housing and Urban Development (HUD).
The former idea is a good one, although I’ll believe that President Romney and Congress have the will to stand up to powerful lobbies such as the real estate and construction industries when I see it happen. It would not, however, generate nearly enough revenue to make up for Romney’s massive tax cuts. Perhaps because Romney himself owns three homes he thinks owning a second home is a fairly common middle class practice. In fact, only 6 percent of Americans have a second home. Eliminating the entire mortgage tax deduction would save about $215 billion by 2021, according to the Congressional Budget Office, so eliminating it only on second homes would save just a fraction of that. If you want to be generous and assume that a lot of the owners of second homes also have third and fourth homes, and that they take out mortgages to buy those homes, you could guess that Romney’s proposal might save something like 10 percent of that total, or a whopping $21.5 billion in total between now and 2021. By contrast, letting the Bush tax cuts expire only on families making more than $250,000 per year would have saved $40 billion in 2011 alone.
While HUD makes for an appealing target for destruction among rich Republicans because it is the only cabinet department dedicated to addressing poverty, it is not actually a very large agency compared to, say, the Pentagon. Its entire budget for fiscal year 2012 is $47.2 billion dollars. (The Department of Defense budget this year is $645.7 billion.) The vast majority of HUD spending falls into one of two appropriation streams: construction of public housing ($19.2 billion) and Section 8 housing vouchers ($17.2 billion). Romney did not specify whether he would eliminate those programs, or just abolish the department that houses them and redistribute their responsibilities. Assuming Romney doesn’t, or can’t, actually get rid of the federal government’s two main programs to prevent homelessness, he won’t get very much savings by closing HUD and its important, but smaller, programs such as Community Development Block Grants. As I report in a forthcoming feature for Next American City, under President Obama HUD has been dramatically helpful to cities with very small amounts of money through programs such as the Sustainable Communities Initiative. I’ve asked the Romney campaign to clarify whether Romney wants to eliminate all federal housing subsidies and, if so, whether he has any plan to combat the dramatic rise in homelessness and severe poverty that would surely result. Having not received a response, my guess is that his honest answer would be that he has no idea what exactly he proposes to cut. And he certainly hasn’t bothered to come up with an alternative affordable housing agenda.
Republicans are not terribly interested in making serious domestic policy proposals or even dealing with social issues at all. For example, House Republicans have decided that their zeal to keep taxes low on millionaires and even billionaires must be paid for by squeezing food stamp recipients. As Politico’s David Rogers reports, “An average family of four faces an 11 percent cut in monthly benefits after Sept. 1, and even more important is the tighter enforcement of rules demanding that households exhaust most of their savings before qualifying for help.” If they succeed, it will save $3 billion per year.
Republicans, including Romney, are fond of saying that they idolize Ronald Reagan and wish to govern as he did. And they would, with lower taxes, higher deficits, greater inequality and less help for the most needy.
By: Ben Adler, The Nation, April16, 2012
“GOP Tax Jihad Continues”: The Enemy Within Shoots Down The Buffett Rule
To nobody’s surprise, the Senate has blocked the Buffett Rule that would have required those earning more than $1 million a year to pay a minimum tax of 30 percent.
The 51-46 vote—short of the 60 votes in support needed to bring the measure to the floor—went along party lines with only GOP Senator Susan Collins crossing the aisle to vote with the Democrats while Senator Mark Pryor of Arkansas sided with the Republicans.
While passage of the measure is estimated to bring in only $47 billion in additional revenue, the proposed law, which has been actively pushed by the Obama Administration, is viewed by supporters as fairness issue while opponents claim that the rich already pay a disproportionate share of the nation’s tax revenue.
Failure of the bill to advance is also likely to give the President a popular issue for his re-election campaign, given the strong support for the law among the general public. According to a CNN/ORC poll out today, 72 percent of the nation’s registered voters support the measure.
Expressing disappointment with the vote, Senate Majority Leader Harry Reid (D-Nev.) said,
The wealthiest one percent takes home the highest share of the nation’s income since the early ’20s, the roaring ’20s. Times are tough for many middle class American families. Millionaires and billionaires aren’t sharing the pain or the sacrifice, not one bit. Last year there were 7,000 millionaires who didn’t pay a single penny in federal income taxes.
But Republicans aren’t buying it, arguing that the proposal is nothing more than a ‘political gimmick’—or so says GOP Minority Leader, Mitch McConnell:
The problem is, we’ve got a president who seems more interested in pitting people against each other than he is in actually doing what it takes to face these challenges head on. By wasting so much time on this political gimmick that even Democrats admit won’t solve our larger problems, it’s shown the president is more interested in misleading people than he is in leading.
Last week, ThinkProgress posted a video of President Ronald Reagan giving a speech indicating that he too objected to the notion of a secretary paying a higher rate of tax than her employer, the circumstance that gave rise to Warren Buffett’s proposal that resulted in his name going on this piece of legislation.
By: Rick Ungar, Contributor, The Policy Page, Forbes, April 16, 2012
“Don’t Tell Anybody”: Romney Offers A Peek Behind The Policy Curtain
“I’m going to take a lot of departments in Washington, and agencies, and combine them. Some eliminate, but I’m probably not going to lay out just exactly which ones are going to go,” Romney said. “Things like Housing and Urban Development, which my dad was head of, that might not be around later. But I’m not going to actually go through these one by one. What I can tell you is, we’ve got far too many bureaucrats. I will send a lot of what happens in Washington back to the states.”
“I’m going to probably eliminate for high income people the second home mortgage deduction,” he continued, adding that he would also support eliminating deductions for state income and property taxes.
Till now, Romney has been very specific about his intention to be very vague. Back in March, he told the conservative Weekly Standard, “one of the things I found in a short campaign against Ted Kennedy was that when I said, for instance, that I wanted to eliminate the Department of Education, that was used to suggest I don’t care about education…So will there be some that get eliminated or combined? The answer is yes, but I’m not going to give you a list right now.”
Sunday’s comments, however, were “overheard by reporters on a sidewalk below.” Romney thought he was speaking privately to a group of conservative donors. And so they offer, in theory, a look behind the curtain. The only problem is there’s not much there.
Romney’s tax plan — which extends all the Bush tax cuts and then cuts taxes even further — will cost the Treasury trillions of dollars in lost revenue. You can’t make that up by capping a few deductions for high-income taxpayers. And while it sounds very tough to talk about closing agencies, it doesn’t save you much money unless you’re also willing to cut the services they provide.
To make his numbers add up, Romney needs to close the largest and most popular deductions in the tax code and cut huge swaths of government social spending. And as of now, he’s not willing to talk about doing that. Not even in private.
By: Ezra Klein, Wonkblog, The Washington Post, April 16, 2012
“Just Saying”: Dear Ann Romney, Allow Others The Choice You Made
I am a proud progressive, both socially and economically. My heart bleeds just as much for economic justice as it does for full equality for women and the LGBT community. As a progressive, as a liberal, the primary objective for which I fight is the right to self-determination: people, regardless of race, class, gender, orientation or any other fortuitous circumstance of birth, should have the ability to pursue their dreams. My liberal identity comes from the belief that government must take a proactive role in ensuring that those whose origins were more humble than others are free from discrimination and at least have a ladder to climb, instead of being forced to watch helplessly as the more fortunate dance on the top rung.
Because of that, I highly respect the decision of Ann Romney to stay at home and raise their five children. It goes without saying that being extremely wealthy makes that decision much easier: the ability to hire nannies and housekeepers when necessary certainly alleviates some of the stresses commonly associated with stay-at-home parenthood. But that isn’t the point: parents who choose to stay at home and raise children willingly risk forgoing the potential social prestige and economic benefits associated with developing an external career. My father, for instance, forsook a promising academic career to raise and home-school my brother and myself. Partly owing to personal experience, I feel that parents who feel that raising children is their calling should be highly respected for their choice: we, as progressives, should no more be in the business of telling parents, especially women, that they should work than the Catholic League should be in the business of telling them that they should sacrifice their ambitions to stay home with their children. What we as progressives must be in the business of doing is making sure that everyone has the ability to make that choice.
Here, however, is where my respect for Ann Romney ends. Once again, it is my job as a progressive to ensure that everyone has access to follow their dreams. Ann Romney, however, supports policies that will ensure that only people of her station will be able to make such sacrifices.
Back in 2003, current Senate candidate Elizabeth Warren co-authored a book called The Two-Income Trap. The main thesis was that even a decade ago, it took two incomes to maintain the same standard of living as one income could provide generations ago. The main culprits were the rising cost of education and the rising cost of insurance. Anyone who has been paying attention knows that these problems have only gotten more aggravated with the passage of time, further limiting the options of parents who might otherwise wish to stay home with children, but cannot spare the income, or in many cases forcing young people who just cannot figure out a way to get ahead of the game to delay marriage and child-rearing, waiting for an era of comfort and job security that may come far later than they expect, if ever.
Ann Romney wishes to be respected for her choice. Fair enough. But the fastest way for her to earn respect for her choice is to make sure such a choice is not the province of her class alone, and that idea is in direct contrast to the policies that her husband Mitt espouses. So here’s a simple message to Ann Romney:
If you care about making sure that parents can afford to stay home with their children, then you don’t support Scott Walker’s efforts to destroy the middle class. You don’t support Paul Ryan’s budget that destroys Medicare and Medicaid. You examine the fact that public education is becoming increasingly expensive, and you support efforts to fund it, rather than continue to watch it spiral out of control and ensure that it takes two incomes to afford any sort of higher education.
You support student loan reform so that new graduates don’t have to work their entire lives to pay off their debt. You don’t “get rid of” Planned Parenthood, which provides vital medical services and helps ensure that women are able to raise healthy children to begin with. You don’t let Detroit go bankrupt so that vulture capitalists like the one you married can sell off its scrap for investor profits. You don’t accelerate foreclosures and kick children out of their homes so that those same investors can make more money from their rental fiefdoms. You do everything you can to ensure that health insurance is not tied to employment (to be fair, Mitt deserves some credit on this).
You support the reauthorization of the Violence Against Women Act to ensure that women who do choose to stay home are guaranteed some sort of recourse against partners who turn bad, instead of being forced into a devil’s choice of being stuck in a violent relationship or out on the streets. You support increases in the minimum wage so that those who do work don’t have to work multiple jobs just to put food on the table. You strengthen social security and its associated death benefit so that widows (or widowers) who chose to stay home have something left to live on in the worst case, instead of privatizing it so that (stop me if this sounds familiar) investors like your husband can figure out how to make even more money off of a program that’s doing just fine as it is.
You support investing in America again through stimulus and public works so that both men and women have good-paying jobs and a much more livable transportation system. And most importantly, you support tax reforms that require the super-wealthy (like your husband) and the gigantic corporations they run to pay their fair share in taxes so that all of these other things can happen.
If you were serious, Ann, these are just some of the things that you’d do. Otherwise, you’re just another spoiled Republican telling people that as long as you can do what you want, then everyone else can go to hell.
By: Dante Atkins, Daily Kos, April 15, 2012
“Magic Asterisks”: Buffett Rule Is Not Raising A Tax; It’s Closing Republican Tax Loopholes
The debate over the Buffett Rule is missing something important. As it stands, the fight is between Democrats who believe millionaires shouldn’t pay a lower tax rate than the middle class vs. Republicans who says no one’s taxes should go up by any amount at any time for any reason.
That’s a legitimate fight, to be sure, but there’s more to it: approving the Buffett Rule would mean closing a loophole, and in the larger context of the debate over tax policy, this makes all the difference in the world.
Let’s step back for a second. Paul Ryan’s House Republican budget plan appears to add an additional $5.4 trillion to the deficit over the next decade. Ryan insists that’s not the case — once he “clears out all the special-interest loopholes,” his numbers will start to add up.
Which loopholes? Well, it turns out that Ryan refuses to say. Maybe they’re secret loopholes; maybe they’re imaginary loopholes; but either way, he hasn’t identified any — literally, not one — loophole he’s willing to close to help pay for his own agenda. It is, as Paul Krugman put it, the “mystery meat” of the Republican plan.
“Oh, yeah?” my Republicans friends ask, “well why don’t Democrats come up with some loopholes to close?”
And therein lies the point: the Buffett Rule closes a loophole. It’s a quirk of the tax code that certain millionaires who enjoy private-equity riches pay a lower tax rate than middle-class families, and approving the Buffett Rule would not only mean establishing a degree of fairness, it would also mean scrapping this loophole.
The point is not lost on President Obama, who made this observation on Wednesday:
“I’d just point out that the Buffett Rule is something that will get us moving in the right direction towards fairness, towards economic growth. It will help us close our deficit and it’s a lot more specific than anything that the other side has proposed so far.” [emphasis added]
In other words, where Paul Ryan is vague and evasive, Obama is being direct and specific. The president is identifying actual loopholes he wants to see closed (Buffett Rule, corporate-jet loophole, tax subsidies for oil companies), which would total tens of billions of dollars in the coming decade. Meanwhile Republican leaders talk about loopholes, but choose not to back this talk up with anything substantive.
One approach represents an honest budget policy. The other, relying on magic asterisks, is a fraud.
By: Steve Benen, The Maddow Blog, April 13, 2012
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