The Romney campaign’s increasingly desperate attempts to dismiss a new study of its tax plan are a pretty good sign that the study is devastating. That isn’t to say the campaign is trying to counter it with actual specifics.
Performed by the Tax Policy Center, a joint venture of the Brookings Institution and the Urban Institute, the study shows that Mitt Romney’s proposal would lead to significantly lower taxes for the rich, and a higher tax burden on middle- and lower-income taxpayers.
The big red one at the far right is tax cuts to the top 1%
It’s been well known for a while that Mr. Romney’s tax plan was a mathematical impossibility. He promised to reduce marginal tax rates by 20 percent, eliminate the estate tax and the alternative minimum tax, and end the capital gains tax for middle-income taxpayers – all while not lowering the amount of revenue coming into the treasury. Mr. Romney said he would offset those losses by ending a series of loopholes, but has yet to cite a single loophole he would delete.
The study tried to estimate what those loopholes might be. But it found that there simply aren’t enough loopholes in the tax code to balance the cut in high-end rates that Mr. Romney has proposed. Thus the rich would wind up with a cut, but to offset the loss of $360 billion by 2015, the middle-class would have to pay more when the breaks for mortgage interest, state taxes, education and medical expenses are wiped away.
Someone with a calculator was inevitably going to find the many holes in the tax plan, given the tissue-thin level of thought that the campaign put into it, at a time when Mr. Romney’s primary opponents were proposing even worse nonsense like the 9-9-9 plan. The campaign has no numbers with which to fight the study–because such numbers don’t exist–so, instead, it’s attacking the authors as liberals...
The Tax Policy Center, if anything, comprises a gang of raging moderates from both parties who have infuriated ideologues for years by simply telling the truth about the tax system. It has one of the more reliable and unbiased computer models of the nation’s tax system. But for the far right (also known as the Republican center), any tax analysis that doesn’t swallow the prosperity gospel of tax-cut magic is, therefore, liberal.
The Romney campaign called the study “a joke” for not taking into account the explosion of economic growth that tax cuts and a reduction in spending will automatically produce. (No details, of course, on how much growth or what precisely would cause it.) But the study’s authors did consider that possibility. Even when they added an unrealistic amount of economic growth to their model, they still couldn’t find a way for the tax cuts to pay for themselves.
Mr. Romney managed to skate through the primaries with an empty grab-bag of tax giveaways, and may have thought that anti-Obama anger would let him get away with it in the general election, too. A definitive study like this one makes it clear his hollowness will have a heavy price.
Friday, August 3, 2012
Mitt Romney wants to raise your taxes and cut his
David Firestone at NYTs: