08.07.12

“Romney-hood” - trickle down tax cut fairy dust

Posted in Around The Nation, Election 2012, Taxes at 2:20 pm by wcnews

Here’s the video of President Barack Obama explaining the concept of “Romney-hood”.

It’s taken a while but over the last month or so the President has finally started to say the things that will get him a second term. He’s taking it to his regressive opponent. Last week the non-partisan Tax Policy Center released a report about the regressive nature of Romney’s unspecific tax plan.

Our major conclusion is that a revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed – including reducing marginal tax rates substantially, eliminating the individual alternative minimum tax (AMT) and maintaining all tax breaks for saving and investment – would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers. This is true even when we bias our assumptions about which and whose tax expenditures are reduced to make the resulting tax system as progressive as possible.

In other words they’re giving Romney the biggest benefit of the doubt they can and still his plan is still hyper-regressive, (beneficial to the wealthy and harmful to everyone else). Ezra has more on the lack of specificity in Romney’s plan, The massive policy gap between Obama and Romney.

Take taxes. Romney has promised a “permanent, across-the-board 20 percent cut in marginal rates,” alongside a grab bag of other goodies, like the end of “the death tax.” Glenn Hubbard, his top economic adviser, has promised that the plan will “broaden the tax base to ensure that tax reform is revenue-neutral.”

It is in the distance between “cut in marginal rates” and “revenue-neutral” that all the policy happens. That is where Romney must choose which deductions to cap or close. It’s where we learn what his plan means for the mortgage-interest deduction, and the tax-free status of employer health plans and the Child Tax Credit. It is where we learn, in other words, what his plan means for people like you and me. And it is empty. Romney does not name even one deduction that he would cap or close. He even admitted, in an interview with CNBC, that his plan “can’t be scored because those details have to be worked out.”

Without specifics it’s extremely easy to deride Romney’s plan. But this is one of the major failings, thus far, of his campaign. He thought he could sail through without having to campaign on specifics. But that’s not going to work, with the President Obama using more populist, pro-middle class rhetoric that is so foreign to Romney. Jeff Madrick in a recent article puts it this way.

Since last fall, Obama has talked a better game than he did in the first years of his presidency. He has proposed a decent jobs program and is now talking in clearer and more forceful ways about the true purposes of government. A second term could be a more enlightened one, and he may yet become one of America’s finest presidents. This will be a historically critical election.

Let’s hope. Things are looking better for President Obama being reelected, and the numbers may be getting better for Congressional Democrats as well. Via Democracy Corps, 100 Days Out: From Serious Vulnerability to a Wave Election.

Less than 100 days until the election, the latest battleground survey by Greenberg Quinlan Rosner for Democracy Corps shows Democrats with an advantage in the most vulnerable tier of Republican districts. The first Democracy Corps survey of the reapportioned battleground shows Republican incumbents in serious and worsening trouble. The 2012 campaign has just turned the corner on 100 days and the message of this survey could not be clearer: these 54 battleground Republicans are very vulnerable and many will lose their seats.

There’s still time and much can happen. But so far the GOP obstructionism and a return to Bush-style, “Romney-hood”, trickle-down economics doesn’t seem to be fooling enough voters into believing in Romney’s regressive policies.

Further Reading:
A point-by-point takedown of Romney’s economic team’s plan, Things Wrong with Hassett, Hubbard, Mankiw, and Taylor, “The Romney Program for Economic Recovery, Growth, and Jobs”.
A great new report from EPI, Prosperity Economics Building an Economy for All.
Also from CEPR, Where Have All the Good Jobs Gone?
And last Krugman smack down Laffer and others, Poor Spokesmen.

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