Mitt Romney Has A Big Tax Problem
Mitt Romney has been insisting for a while that he will not cut taxes for the rich, which everybody took to mean that he would lock into place the enormous, expiring Bush-era tax cuts for the rich, but cut taxes no deeper than that. He has said so over and over again. Here he is saying, “If I’m going to use precious dollars to reduce taxes, I want to focus on where the people are hurting the most, and that’s the middle class. I’m not worried about rich people.” And here’s Romney insisting, “I’m proposing no tax cuts for the rich.”
Today the Tax Policy Center analyzes his plan, and it turns out that Romney would, in fact, cut taxes for the rich, even below current levels. The highest-earning one percent would get an additional tax cut averaging $82,000 a year. Romney’s plan would also raise taxes on the lowest quintile by an average of $157 a year.
That the leading Republican wants to cut taxes for the rich is not exactly man-bites-dog. But it is a huge political liability for him. Raising taxes on low-income earners is unpopular, cutting taxes for the rich is unpopular, and doing it when you’re a wealthy scion who looks like a wealthy scion is extremely unpopular. That’s why Romney has been furiously insisting he won’t cut taxes for the rich.
Ross Douthat, taking Romney’s claims at face value (like many of us did), confidently asserted yesterday that he has avoided exposing himself to the charge of cutting taxes for the rich. Romney, he wrote, is “campaigning instead on a revenue-neutral tax reform and a modest tax cut for middle class investors, neither of which leaves him particularly vulnerable to the charge of “giving massive tax breaks to the rich.”
Turns out he’s not. And his plan isn’t revenue-neutral, either. It would add $180 billion to the deficit in 2015.
What makes this report tougher for Romney is the timing. He’s already under pressure from conservatives upset with his pledge not to cut taxes for the rich. If he had already wrapped up the nomination, Romney could just say, “oops, we screwed up the plan,” and release a new one that holds taxes for the rich at their Bush-era levels and doesn’t raise them on the working class. But that would be a tricky move in the midst of a primary. Anyway, the changes he’d have to make would be very large — $180 billion a year is big money, requiring a major revamp of his plan.
By: Jonathan Chait, Daily Intel, January 5, 2012
GOP Still Clueless About Resentment Of Inequality
In his New York Times opinion piece, “Let’s Not Talk About Inequality,” Thomas B. Edsall does a good job of tracing the change in public attitudes toward Republican economic policies in the wake of the 2008 meltdown.
Edsall quotes Gingrich’s and Romney’s pious pronouncements about workers needing to “become more employable” (Newt) and achieving “success and rewards through hard work” (Mitch), which is a little hard to digest, coming from a guy who gets six figures for a speech and another who made his fortune in hedge funds. This in “an American economy sharply skewed towards the affluent, with rising inequality, a dwindling middle class and the persistence of long-term unemployment.”
Not all Republicans are quite so clueless. Edsall quotes GOP framing guru Frank Luntz, “I’m so scared of this anti-Wall Street effort” because “they’re having an impact on what the American people think of capitalism.” Edsalll also quotes Democratic strategist Geoff Garin, who explains “…The Republican/Tea Party narrative about the economy has been superseded by a different narrative – one that emphasizes the need to address the growing gap between those at the very top of the economic ladder and the rest of the country.”
Garin cites poll data indicating stronger support for “a set of policies generally favored by Democrats calling for the elimination of tax breaks for the rich and tougher regulation of major banks and corporations” and that the public believes the federal government should “pursue policies that try to reduce the gap between wealthy and less well-off Americans.” He also cites polling data spelling big trouble for the GOP:
The job ratings of Republicans in Congress have tanked at 74 percent negative to 19 percent favorable, dropping more steeply than Obama’s, which are 51 negative-44 positive. But the Post survey also found that congressional Republicans run neck and neck with the president when respondents are asked “who would you trust to do a better job” on handling the economy (42-42) and creating jobs (40-40). On an issue on which the public traditionally favors Democrats by wide margins, “protecting the middle class,” Obama held only a 45-41 advantage over congressional Republicans.
Republicans are scrambling to figure out how to blame Democrats for worsening inequality, explains Edsall. But “The issue of inequality is inherently dangerous for Republicans who are viewed by many as the party of the upper class.” Further,
An Oct. 19-24 CBS/New York Times poll asked respondents whether the policies of the Obama administration and the policies of Republicans in Congress favor the rich, the middle class, the poor or treat everyone equally. Just 12 percent said Obama favors the rich, while 69 percent said Republicans in Congress favor the rich.
And when Ryan’s budget scheme is explained to voters, they “are horrified by it,” according to Garin. Edsall marvels at the GOP’s blindness in making it possible for their two front runners to get bogged down in arguments about how much more to give the wealthy while weakening Medicare benefits for the middle class — “in a climate of stark economic adversity for millions of unemployed Americans.”
Edsall is right. Democrats could not have hoped for a more self-destructive scenario in the Republican camp. If Democrats can project a credible message that offers hope for a better future for middle class voters in the months ahead, the optimism that has begun to emerge in Democratic circles will be justified.
By: J. P. Green, The Democratic Strategist, December 13, 2011
Grover Norquist Tells GOP That Raising Taxes On The Middle Class Doesn’t Count As A Tax Increase
Anti-tax zealot Grover Norquist, the president of Americans For Tax Reform and author of the radical anti-tax pledge that has played a significant role in hamstringing budget and deficit-reduction negotiations, has said that it is unacceptable for those who have signed his pledge to vote in favor of any tax increase. But now that President Obama and congressional Democrats are backing a tax cut aimed at stimulating economic growth, Norquist has changed his tune.
Norquist met with Republican members today to let them know that opposing the extension of the payroll tax cut — which would provide many families an extra $1,000 a year — would not amount to supporting a tax increase, National Journal’s Billy House reported today:
That stands in contrast, however, to Norquist’s position on tax cuts for the wealthy. Norquist has repeatedly warned GOP members about voting in favor of repealing the Bush tax cuts for the rich or tax hikes on millionaires, even verbally sparring with a member of a group of millionaires advocating for higher taxes on themselves last month in Washington, D.C. And yet, when it comes to tax cuts for the middle class meant to drive economic recovery, Norquist clearly takes a different stance.
Republicans who have defended those tax breaks for the wealthy aren’t so sure about holding the Norquist position, though. House Majority Leader Eric Cantor (R-VA) warned his rank and file this morning about opposing the extension, telling them that “taxes are a Republican issue and you aren’t a Republican if you want to raise taxes on struggling families to fund bigger government.” Multiple Republican senators, meanwhile, have come out in favor of the extension, and Sen. Sue Collins (R-ME) even proposed raising taxes on some wealthy Americans to pay for it.
By: Travis Waldron, Think Progress, December 1, 2011
Michele Bachmann’s Mis-statements May Be Catching Up To Her
Michele Bachmann was laying out a tough immigration policy recently when she veered off script to make a point that she said underscored the national security implications of a porous border.
“Fifty-nine thousand this year came across the border, as was said in the introduction, from Yemen, from Syria. These are nations that are state sponsors of terror,” the Minnesota congresswoman and Republican presidential candidate said, citing a report she had heard. “They’re coming into our country!”
There were two problems with Bachmann’s passionate assertion. Yemen is not a state sponsor of terrorism, according to the State Department. And the Border Patrol report to which Bachmann referred said that while 59,000 apprehended illegal immigrants came from countries other than Mexico, only 663 had ties to countries with links to terrorism.
Voters here frequently say they are drawn to support Bachmann’s presidential campaign by the litany of statistics and facts that stud her speeches. Yet what she says is often inaccurate, misleading or wildly untrue.
All politicians occasionally shade the facts to their advantage. The danger for Bachmann is that her misstatements are so pronounced and so numerous that they erode her effort to regain footing in the presidential race. (Asked for reaction, a campaign aide provided information unrelated to the statements in question.)
Some of her misstatements have registered as eye-rolling blips, such as when she confused actor John Wayne with serial killer John Wayne Gacy on the day she entered the campaign in June. Others have damaged her candidacy.
She won points in a September debate when she assailed Texas Gov. Rick Perry for supporting a proposed requirement that young girls be vaccinated against a sexually transmitted disease. But then Bachmann told a post-debate television audience that the vaccine had caused mental retardation, a conclusion drawn from a brief meeting with a weeping mother. Bachmann’s hit against Perry was lost in howls of dismay from physicians who said her untrue remarks would discourage vaccination and endanger children.
On recent campaign swings through Iowa, she continued to trip over matters large and small.
In Sioux Center, Bachmann said high corporate taxes and crushing regulations had made the United States less competitive than other countries, a mantra common among GOP candidates. But then she went further.
“If you want to have a business in China today, if you want to build a building, you just build it, you don’t go through all the permitting process that we do here,” she said.
Businesses have to apply for multiple permits in China. A 2008 World Bank publication found that China was among the most difficult places anywhere to obtain construction permits, ranking No. 176 of 181. The publication ranked the best and worst places, and the United States fell in neither category.
At a rally in Denison, Bachmann touted her plan to slash federal taxes and implied that taxes are higher now than when she was young.
“How many of you think that the taxes are too high in the United States? We got any takers on that?” she said as the crowd roared in approval. “I grew up in this wonderful state and I’ll tell you, the tax rate was completely different years ago from what it is now, wasn’t it? They’re very high.”
In 2011, a married couple filing jointly would have paid 35 percent of their income in taxes if they made $379,150, the lowest income in the top bracket, according to the nonpartisan Tax Foundation. Fifty years ago, when Bachmann was a child, the same couple would have paid 59 percent in federal taxes. The lowest federal tax bracket today is half what it was then.
The candidate bases at least some of her assertions on obscure conspiracy theories.
In Estherville, after a supporter asked her position on the Second Amendment, Bachmann said she supported Americans’ rights to own guns and that she had a permit to carry a concealed weapon.
But then she added: “I don’t believe in the U.N. taking that right away from us, as well. There are international treaties that want to do that.”
The United Nations is drafting an arms treaty, but it is aimed at stemming illegal international gun sales. While many gun manufacturers are concerned that such a treaty could lead to broader gun registration, only a narrow fringe purports that Americans could see their guns taken away by the U.N., which has no authority over constitutional rights.
Bachmann’s mistakes predate her entry into the presidential race. In November, she told a national television audience that a trip by President Barack Obama to India cost $200 million a day. The report was based on an anonymous quotation in an Indian newspaper.
The White House does not release cost figures for security reasons, but people involved in travel by presidents from both political parties said the number was grossly exaggerated.
An embarrassing correction also marked a recent Bachmann move on Capitol Hill. Earlier this month, she introduced a bill requiring any woman considering an abortion to undergo an ultrasound that pinpoints the heartbeat of the fetus.
“A study by Focus on the Family found that when women who were undecided about having an abortion were shown an ultrasound image of the baby, 78% chose life,” Bachmann said.
That prompted a news release from the conservative organization, which said that while it supports the legislation, it had produced no such report.
“We don’t have any ‘studies,’ and we don’t publish any percentages like that,” Kelly Rosati, Focus on the Family’s vice president of community outreach, said in a statement.
A Bachmann aide said the candidate got the statistic from a Des Moines clinic. The aide also cited a report that appeared in the Rocky Mountain News of Denver that cited a Focus on the Family statistician for a similar claim.
By: Seema Mehta, McClatchy-Tribune News Service, October 23, 2011
The Speech Eric Cantor Chose Not To Give
Just two weeks after denouncing economic-justice protesters as an angry “mob,” House Majority Leader Eric Cantor (R-Va.) seemed to be shifting gears. Last Sunday, Cantor acknowledged the “warranted” frustrations of the middle class, and this week, was even poised to deliver a speech on economic inequality.
As it turns out, Cantor changed his mind. Yesterday, the oft-confused Majority Leader abruptly canceled, saying the University of Pennsylvania’s Wharton School invited the public to attend the speech, which meant Cantor would refuse to appear. The Republican appears to have been fibbing — university officials explained that the event had always been billed as “open to the general public,” and that Cantor’s accusation of a last-minute change in attendance policy simply wasn’t true.
That Cantor was afraid to talk about economic inequalities in front of the public is pretty ridiculous. That Cantor is making dishonest excuses makes matters slightly worse.
But let’s put all of that aside and consider what the Majority Leader intended to say if he’d kept his commitment and shown up. The Daily Pennsylvanian, UPenn’s campus newspaper, published the prepared text of Cantor’s speech, offering the rest of us a chance to see the GOP leader’s thoughts on the larger issues.
After having read it, it seems Cantor probably made a wise choice canceling at the last minute.
How would the Majority Leader address growing income inequalities? He wouldn’t. In fact, Cantor’s plan seems to be to discourage people from talking about the issue altogether.
“There are politicians and others who want to demonize people that [sic] have earned success in certain sectors of our society. They claim that these people have now made enough, and haven’t paid their fair share. But, pitting Americans against one another tends to deflate the aspirational spirit of our people and fade [sic] the American dream.”
This is just dumb. Asking those who’ve benefited most from society to pay a fair share isn’t “pitting Americans against one another” or “demonization.” (An actual example would be when Cantor and his ilk condemn labor unions, scientists, teachers, economists, trial lawyers, and community organizers.) What’s more, in context, didn’t use these tired platitudes as a transition to a substantive point; there were no substantive points.
“Much of the conversation in the current political debate today has been focused on fairness in our society. Republicans believe that what is fair is a hand up, not a hand out. We know that we all don’t begin life’s race from the same starting point. I was fortunate enough to be born into a stable family that provided me with the tools that I needed to get ahead. Not everyone is so lucky. Some are born into extremely difficult situations, facing severe obstacles. The fact is many in America are coping with broken families, dealing with hunger and homelessness, confronted daily by violent crime, or burdened by rampant drug use.”
And how would Cantor help improve these conditions, clearing the way for income mobility? He’d cut taxes on the wealthy again, and wait for wealth to trickle down. That’s his solution to the growing gap between rich and poor.
The Majority Leader went on to say, “We should want all people to be moving up and no one to be pulled down.” Tim Noah noted how misguided Cantor’s understanding of economics is: “Cantor’s income inequality solution is to elevate all of the bottom 99 percent in incomes up to the top 1 percent. That would shut up the Occupy Wall Street crowd for sure! A more practical solution — and one that doesn’t violate the laws of mathematics — would be to encourage mobility, by all means (the U.S. has actually fallen behind most of western Europe in this regard) but also to pay close attention to what happens to the people who don’t make it to the top. The bottom 99 percent contribute to prosperity too, and lately they haven’t had much to show for it. Cantor seems not in the slightest bit curious as to how that happened.”
How many policy ideas did Cantor present to address economic inequalities, in his speech about economic inequalities? None.
Keep in mind, this was a prepared speech, not comments made off the kuff in an interview. Cantor was able to take his time, think about the subject in depth, and rely on his staff to present a coherent vision with some depth.
And the intellectually bankrupt Majority Leader still couldn’t think of anything interesting to say.
By: Steve Benen, Washington Monthly Political Animal, October 22, 2011
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