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“Mitt’s Moochers”: The Dangerous Lie His Funders Love To Hear

Mitt Romney got some unwanted attention early this year when he flatly stated, “I’m not concerned about the very poor.” When challenged on this remark he assured Americans that the safety net for the very poor was a given, safe from any budget and tax code tinkering in Washington. This was a sinister explanation since Romney’s tax and spending plan — or as much of it as can be deciphered — calls for further tax cuts for the wealthy at the expense of social services that he claimed were safe.

Now, we see that it’s not just the “very poor” who don’t merit Romney’s “concern.” At the now-infamous $50,000-a-plate fundraiser in Florida, Romney wrote off the concerns of the 47 percent of Americans who don’t owe federal income taxes, saying that half of Americans are “dependent on government,” “believe that they are the victims,” and have the gall to “believe that they are entitled to health care, to food, to housing, to you name it.”

That 47 percent includes families and individuals with low incomes — about 23 percent of taxpayers, according to the Tax Policy Center. It also includes those for whom tax credits for children and working families have eliminated tax burdens — about 7 percent. It also includes seniors who have left the workforce — about 10 percent. Over half of the 47 percent pay federal payroll taxes. All are subject to state and local taxes, many of which, like sales taxes, are more regressive than federal taxes. (And if we ever see more Romney tax returns, we may find some years when the Romney’s were in that entitled 47 percent.)

As conservative writer Reihan Salam points out in the National Review, policies like the Child Tax Credit and the Earned Income Tax Credit — responsible for much of this tax relief for working families — were conservative ideas meant to reduce the “dependency” that Romney so reviles, by “encourag[ing] people get on the first rungs of the jobs ladder, and to become less dependent over time.”

Romney was telling the well-heeled guests at this fundraising dinner that these people — middle-class parents, low-income workers, the unemployed, the elderly — aren’t interested in working hard despite the fact that most of them report to the IRS each year that they work quite a lot. This isn’t just tin-eared politics. Like Romney’s comments on the “very poor,” it represents a profound misunderstanding of how Americans’ lives work and how his policies would affect those lives.

But even talking about the “47 percent versus the 53 percent” belies the fact that nobody in America is free from at least some government “dependency.” We all rely on roads, hospitals, schools, firefighters, police officers, and our military — even Mitt Romney and his $50,000-a-plate friends. Romney himself has relied on the government’s safety net for businesses, securing a federal bailout for Bain & Company. Nobody succeeds without some help from a stable, functional government. That’s what President Obama was saying when his “you didn’t build that” comments were taken out of context.

Romney was clearly telling his funders a fantasy story that they love to hear. But that story is a lie, and we shouldn’t accept it from someone who could become a president representing 100 percent of the American people.

 

By: Michael B. Keegan, The Hufffington Post Blog, September 19, 2012

September 20, 2012 Posted by | Election 2012 | , , , , , , , , | 1 Comment

“Americans Who Do Not Pay Taxes”: Isn’t Mitt Romney A Member Of The 47 Percent?

Mitt Romney, a son of privilege who used family connections and family advantages to accumulate a “vulture capitalist” fortune, and who now collects multimillion-dollar checks for doing absolutely nothing, claims to have identified 47 percent of Americans “who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That that’s an entitlement. And the government should give it to them.”

Most of these people, Romney gripes, “pay no income tax.”

That, Romney suggests, makes them non-entities in his political calculus.

“My job is is not to worry about those people,” says Romney, who predicts all the “dependent” voters will back Barack Obama this year. “I’ll never convince them they should take personal responsibility and care for their lives.

But Romney should not be so dismissive of the tax-avoiding class. After all, he’s one of them.

The nonpartisan Tax Policy Center says roughly 46 percent of Americans paid no income tax for the last year where numbers are available, 2011. Slightly less than half of those who do not pay take advantage of tax breaks designed to ease the burden on elderly Americans who live on fixed incomes. Roughly a third of them do not pay because they are beneficiaries of tax credits designed to help the working poor and children to get by.

In other words, the Americans who do not pay taxes are, for the most part either low-income workers or retired low- or middle-income workers. They are not dodging tax responsibilities. They are filing forms and taking exemptions that were designed to relieve or eliminate tax burdens for those who are least able to pay.

The Tax Policy Center offers the example of a working couple making minimum wages who have two children and earn under $26,400 a year. Using standard deductions and specific exemptions designed for families in their circumstance, they can file a form that has a zero in the amount due column.

Tens of millions of American households—many of them our hardest-working citizens—find themselves in this category. Remember that, according to the Census Bureau, 46.2 million Americans lived in poverty in 2011.

Mitt Romney is not a member of this class of Americans. As a quarter-billionaire, he is part of a multi-generational elite—the most privileged 1 percent of the 1 percent—that has never ever had to worry about making ends meet at the end of the month.

But Mitt Romney has something in common with the working poor.

Like them, he benefits from federal programs that are designed to allow some Americans to avoid paying some or all of the taxes that would otherwise be due from them.

Roughly 13 percent of high-income Americans use itemized deductions—mortgage interest, health payments, or charitable contributions, education tax credits, or tax-exempt interest—to zero out their taxes.

Mitt Romney has not released the tax returns that his dad said a candidate for the presidency owes the American people—forms for the twelve years before their candidacy. So we do not know if he is an actual member of the 47 percent.

By Mitt Romney’s own admission, his accountants make sure that he does not “pay any more (taxes) than are legally due.”

All indications, from Romney and his campaign, are that he has taken full advantage of: tax exemptions, tax credits, tax havens and tax loopholes.

What sort of loopholes? We get an indication from documents filed by the firm that continued to stream money into Romney’s personal accounts long after he quit as a partner.

“The Bain documents posted [in August] show that Bain Capital will go to great lengths to help its partners and its investors avoid tax,” explained Rebecca Wilkins, senior counsel at Citizens for Tax Justice. “Beyond simply putting their funds offshore, the Bain private equity funds are using aggressive tax-planning techniques such as blocker corporations, equity swaps, alternative investment vehicles and management fee conversions.”

That’s how someone who makes tens of millions of dollars says he pays around 13 percent of his annual income into the US Treasury, as opposed to the top marginal tax rate of 35 percent. For 2011, he estimated that he would pay $3.2 million on income of $21 million.

If Mitt Romney had paid at the 35 percent rate that he is supposed to be paying at, the check he wrote would have been for $7.4 million.

So he avoided paying $4.2 million in taxes.

That’s the same as the total amount that—were they paying at the marginal rate that would apply to the working poor if there were no exemptions—would be paid by roughly 1,100 of the low-income families Mitt Romney dismisses as “dependent.”

At the very least, it would seem that Mitt Romney has earned honorary membership in the 47 percent.

 

By: John Nichols, The Nation, September 18, 2012

September 19, 2012 Posted by | Election 2012 | , , , , , , , , | Leave a comment

“The Real Awful Mitt Romney”: The Epitome Of Jawdroppingly Stupid Arrogant Privilege

If you thought Mitt Romney had a rotten summer—failing to project a more appealing image of himself and his policies, failing to pin the country’s economic woes on the president, failing to get even the tiniest bounce from his convention—the home stretch is shaping up even worse. Fast on the heels of his aggressively wrong-headed response to the embassy attack in Libya (which gets terrible reviews from most Americans), Mother Jones today released a bombshell video of Romney speaking way too candidly to a small group of well-heeled campaign contributors.

This is must-see footage—and even if you don’t want to see it, you won’t be able to help it over the next few days. These are words that will haunt Romney for the rest of the campaign—and the rest of his political career. He jokes that he’d have a better chance of being elected if he were of Mexican lineage; he insults Obama voters (and 47 percent of the country) in the most stereotypical and racially-tinged terms possible; he brags about sharing campaign consultants with Bibi Netanyahu; and he insists that Americans are, basically, too empty-headed to care about policy specifics. And this is only the first batch of videos to come; God only knows what else he might have let loose with.

We can’t sum it up better than David Corn, who got this “get” for MoJo: “With this crowd of fellow millionaires, he apparently felt free to utter what he really believes and would never dare say out in the open. He displayed a high degree of disgust for nearly half of his fellow citizens, lumping all Obama voters into a mass of shiftless moochers who don’t contribute much, if anything, to society, and he indicated that he viewed the election as a battle between strivers (such as himself and the donors before him) and parasitic free-riders who lack character, fortitude, and initiative. … These were sentiments not to be shared with the voters; it was inside information, available only to the select few who had paid for the privilege of experiencing the real Romney.”

Romney’s comments will inevitably be likened to Barack Obama’s infamous slur (also recorded in a private donor meeting) about white Pennsylvanians clinging to guns and religion. Both expressed the kind of disdain for their fellow Americans that no candidate should allow to escape his or her lips. But in terms of political impact, this is sure to play much worse. For one thing, that was April 2008, and this is mid-September 2012—leaving the candidate little time to recover. Another essential difference: Obama was well-liked and admired by the vast majority of Americans when he had his bigoted slip of the lip; Romney is already overwhelmingly disliked, even by many who plan to vote for him. Obama’s comments surprised people; Romney’s comments confirm what people already suspected about him. He comes across as the epitome of arrogant privilege.

There is no way that this glimpse into the “real Romney” won’t turn off a large majority of the country—including plenty of the same people of privilege he was speaking to in that room. Even if they agree with the candidate secretly, they will have some serious second thoughts: How could anyone running for president, for pete’s sake, be so breathtakingly, jaw-droppingly stupid as to utter such things aloud?

 

By: Bob Moser, The American Prospect, September 17, 2012

September 18, 2012 Posted by | Election 2012 | , , , , , , , | 2 Comments

“Standing Up For Teachers”: Collective Bargaining Is Not The Problem

Teachers are heroes, not villains, and it’s time to stop demonizing them.

It has become fashionable to blame all of society’s manifold sins and wickedness on “teachers unions,” as if it were possible to separate these supposedly evil organizations from the dedicated public servants who belong to them. News flash: Collective bargaining is not the problem, and taking that right away from teachers will not fix the schools.

It is true that teachers in Chicago have dug in their heels against Mayor Rahm Emanuel’s demands for “reform,” some of which are not unreasonable. I’d dig in, too, if I were constantly being lectured by self-righteous crusaders whose knowledge of the inner-city schools crisis comes from a Hollywood movie.

The problems that afflict public education go far beyond what George W. Bush memorably called “the soft bigotry of low expectations.” They go beyond whatever measure of institutional sclerosis may be attributed to tenure, beyond the inevitable cases of burnout, beyond the fact that teachers in some jurisdictions actually earn halfway decent salaries.

The fact is that teachers are being saddled with absurdly high expectations. Some studies have shown a correlation between student performance and teacher “effectiveness,” depending how this elusive quality is measured. But there is a whole body of academic literature proving the stronger correlation between student performance and a much more important variable: family income.

Yes, I’m talking about poverty. Sorry to be so gauche, but when teachers point out the relationship between income and achievement, they’re not shirking responsibility. They’re just stating an inconvenient truth.

According to figures compiled by the College Board, students from families making more than $200,000 score more than 300 points higher on the SAT, on average, than students from families making less than $20,000 a year. There is, in fact, a clear relationship all the way along the scale: Each increment in higher family income translates into points on the test.

Sean Reardon of Stanford University’s Center for Education Policy Analysis concluded in a recent study that the achievement gap between high-income and low-income students is actually widening. It is unclear why this might be happening; maybe it is due to increased income inequality, maybe the relationship between income and achievement has somehow become stronger, maybe there is some other reason.

Whatever the cause, our society’s answer seems to be: Beat up the teachers.

The brie-and-chablis “reform” movement would have us believe that most of the teachers in low-income, low-performing schools are incompetent — and, by extension, that most of the teachers in upper-crust schools, where students perform well, are paragons of pedagogical virtue.

But some of the most dedicated and talented teachers I’ve ever met were working in “failing” inner-city schools. And yes, in award-winning schools where, as in Lake Wobegon, “all the children are above average,” I’ve met some unimaginative hacks who should never be allowed near a classroom.

It is reasonable to hold teachers accountable for their performance. But it is not reasonable — or, in the end, productive — to hold them accountable for factors that lie far beyond their control. It is fair to insist that teachers approach their jobs with the assumption that every single child, rich or poor, can succeed. It is not fair to expect teachers to correct all the imbalances and remedy all the pathologies that result from growing inequality in our society.

You didn’t see any of this reality in “Waiting for ‘Superman,’ ” the 2010 documentary that argued we should “solve” the education crisis by establishing more charter schools and, of course, stomping the teachers unions. You won’t see it later this month in “Won’t Back Down,” starring Viola Davis and Maggie Gyllenhaal, which argues for “parent trigger” laws designed to produce yet more charter schools and yet more teacher-bashing.

I’ve always considered myself an apostate from liberal orthodoxy on the subject of education. I have no fundamental objection to charter schools, as long as they produce results. I believe in the centrality and primacy of public education, but I believe it’s immoral to tell parents, in effect, “Too bad for your kids, but we’ll fix the schools someday.”

But portraying teachers as villains doesn’t help a single child. Ignoring the reasons for the education gap in this country is no way to close it. And there’s a better way to learn about the crisis than going to the movies. Visit a school instead.

 

By: Eugene Robinson, Opinion Writer, The Washington Post, September 17, 2012

September 18, 2012 Posted by | Education | , , , , , , , , | 1 Comment

“Growing Inequality”: A Rich Man, Poor Man Election

Three new reports on taxes, inequality and economic mobility add up to one conclusion: The 2012 presidential election should be about one thing, and one thing only: class warfare.

Let’s start with a report from the Pew Charitable Trusts, “Pursuing the American Dream: Economic Mobility Across Generations.”

The Pew Economic Mobility Project has been tracking the economic status of thousands of families since 1968 — the data covered in the current report is through 2009. And there is some good news: Absolute income has increased for Americans of all economic classes, from the poorest to the richest. The richest Americans have seen much larger relative gains, and, naturally, are far more immune to skyrocketing healthcare and education costs than are the poor, but at least part of the American dream is still intact: Children are still earning higher incomes than their parents.

But then comes the bad news: When one measures wealth — the total assets held by families — instead of income, the picture is substantially different. As Catherine Rampell summarized in the New York Times:

The median person in the poorest quintile has a family net worth that is 63 percent less than that of his counterpart a generation ago: $2,748, versus $7,439 …

The median family in the top socioeconomic class today (i.e., the family at the 90th percentile) is worth $629,853, compared to $495,510 in the last generation. That’s a 27 percent increase in the size of the median fortune in the top income stratum.

If you’re scoring at home: Rich: richer; Poor: poorer.

Now let’s move to “Inequality and Redistribution During the Great Recession,” a research paper produced by the Minneapolis Fed.

In 2010, the bottom 20 percent of the U.S. earnings distribution was doing much worse, relative to the median, than in the entire postwar period. This is because their earnings (including wages, salaries, and business and farm income) fell by about 30 percent relative to the median over the course of the recession. This lowest quintile also did poorly in terms of wealth, which declined about 40 percent …

However, even as earnings plunged, disposable income and consumption managed to hold even, relatively speaking, for the poorest Americans as compared to other classes. This is a bit of a mystery, noted the authors, who believe it can be explained by aggressive government redistribution and tax cuts.

Our main substantive conclusion is that government redistribution in the Great Recession was at historical highs and partially shielded households from experiencing large declines in disposable income and consumption expenditures. The same households, though, have experienced losses in net wealth, and this might make them more vulnerable to further or more persistent earnings declines in the future.

If you’re still keeping score: While the rich were getting richer and the poor poorer, the Great Recession absolutely hammered the worst-off Americans, but substantial government support — unemployment benefits, food stamps, Medicaid, tax cuts — saved the most vulnerable Americans from utter disaster.

And that brings us to our third report, the Congressional Budget Office’s latest numbers on federal taxes: “The Distribution of Household Income and Federal Taxes: 2008-2009.”

The bottom line: In 2009, as a result of tax cuts included in the stimulus, Americans ended up paying the lowest percentage of their income in federal taxes since 1979.

The observations included in these reports mutually reinforce each other. For example, one reason why the wealthiest Americans have done so much better than everyone else is directly related to substantial cuts in the capital gains tax rate over the past several decades. High unemployment and the collapse in home prices as a result of the Great Recession, on the other hand, have a disproportionately greater effect on poorer Americans, whose net wealth has been declining over past decades.

The numbers also beg to be put in political context. Over the long term, the rich have been getting richer and the poor poorer. In the short term, the poor took the brunt of the impact of the Great Recession, and were only kept afloat through government assistance. However, as tax rates have fallen to historic lows, it has become more and more difficult for the federal government to find the resources necessary to ameliorate widening inequality.

Now consider the fact that the Republican candidate for president wants to cut taxes even further, while eviscerating the social welfare safety net that is the only thing staving off complete economic disaster for poorer Americans. It’s class warfare all right, but one side seems to have already won.

 

By: Andrew Leonard, Salon, July 11, 2012

July 14, 2012 Posted by | Election 2012 | , , , , , , , , | Leave a comment

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