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Blog of Mass Destruction

Romney & His Tax Plan

By The Reverend Published: August 7, 2012

What have I been doing the last 6 days or so that I couldn't blog? I want to explain it all in great detail, release multiple reports on the topic,..you know...really be transparent.....BUT.....then conservative readers would distort and misinterpret the information I released about the last six days or so....twisting everything up like they always do. And I just can't allow that. The American people deserve better than that.

Therefore, it's the fault of conservative readers, not mine, for not being able to release info detailing The Reverend's activity over the last six days. My philosophy on the topic of transparency concerning the last six days or so of my whereabouts has been shaped by the GOP presidential candidate....

Oh, I think people in my party just say, "Look, this is a non-issue. Just release the returns and it will go away." My experience is that the Democratic Party these days has approached taxes in a very different way than in the past. Their opposition people look for anything they can find to distort, to twist, and to try and make negative.

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The Tax Policy Center released a report on the effect of Mitt Romney's tax cut proposals. The report, overly generous to Mr. Romney, concluded that in order for the plan to be revenue neutral, middle class Americans would see their taxes go up by approximately $2000 per year.

Romney's plan cuts income taxes by 20%, leaves capital gain and dividend rates where they are, and "broadens the tax base" (eliminates tax deductions) to accomplish revenue neutrality. The Tax Policy Center report took Romney's plan seriously including the part about eliminating tax deductions in order to pay for the 20% tax cuts.

The problem is.....even if Romney were to eliminate all tax expenditures for people making over $200K a year....it's still far from enough to make the cuts revenue neutral. Ipso facto, the only way to maintain neutrality is to cut tax deductions for middle class and average workers.....stuff like mortgage interest deductions, medical expense deductions, etc......which will result in higher taxes on those earning below the $200K level.

Mitt and his campaign disagree with the Tax Policy Center's conclusions and called the report "biased."

"This is just another biased study from a former Obama staffer that ignores critical parts of Governor Romney’s tax reform program, which will help the middle class and promote faster economic growth,” Chen (Romney policy director) wrote in a statement Monday evening in response to the study by the Tax Policy Center released earlier in the day.

Here's the money quote...

“The study analyzes only half of Governor Romney’s tax program, ignoring the reforms that would make America’s corporations more competitive by moving from the highest corporate tax rate in the industrialized world to one that is comparable to our trading partners. And the study ignores the positive benefits to economic growth from both the corporate tax plan and the deficit reduction called for in the Romney plan. These glaring gaps invalidate the report’s conclusions.”

Lowering the corporate tax rates and lowering income tax rates on America's wealthiest....according to Romney's policy director....will have "positive benefits to economic growth."

This is the point where I remind readers of modern conservatism's predilection to dabble in voodoo.

What Romney's guys are saying is the same old warmed over spit that did not work under Reagan or Bush, the Younger. Cutting tax revenues NEVER results in more government revenue than was originally cut. NEVER.

The premise of voodoo economics is that when tax cuts favoring the wealthy are made....then the mighty surge of private economic growth resulting will stimulate new business, new growth, new hiring...so much....that more tax revenues than were lost in the original cutting of taxes will flow into the federal Treasury.


No matter that the new tax revenues never materialized as promised under Reagan or Bush Jr.....Romney has a rooster foot in one hand and a stickpin doll in the other....calling for renewed faith in the doctrine of the dead and failed.

But the punchline here is just too much. As expected, the Romney camp dismissed the Tax Policy Center's report as "biased'...even though the study literally bent over backwards to give Romney's plan every benefit of the doubt....

“Although reasonable models would show that these tax changes would have little effect on growth, we show that even with implausibly large growth effects, revenue neutrality would still require large reductions in tax expenditures and would likely result in a net tax increase for lower- and middle-income households and tax cuts for high-income households,” the study concluded.

Which further confirms what I've been telling readers here for 5 years this month. When it comes to economic matters, the modern GOP has nothing of value to offer average Americans. The same as it ever was.

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