The Brookings Institute (Thoroughly) Explains Why Mitt Romney's Tax Plan is Terrible
http://www.taxpolicycenter.org/UploadedPDF/1001628-Base-Broadening-Tax-Reform.pdf
This is a paper that was published Aug. 1 by the Urban Brookings Tax Policy Center. It is an analysis of what would happen if the tax reforms proposed by Governor Mitt Romney's campaign were implemented.
It's a little dense, but not too difficult to get the gist of. The abstract of the paper reads thus: "This paper examines the tradeoffs among three competing goals that are inherent in a revenue-neutral income tax reform- maintaning tax revenues, ensuring a progressive tax system, and lowering marginal tax rates- drawing on the example of the tax policies advanced in presidential candidate Mitt Romney's tax plan. Our major conclusion is that any revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed would provide large tax cuts to high-income households, and increase the tax burdens on middle and/or lower income households."
The Brookings Institute actually went one step farther than Mitt Romney because they tried to offset the tax cuts, whereas Romney has given no specifications as to how he will make up for the 465 billion in revenue the United States Government will be losing due to tax cuts. They illustrate how it is impossible to offset the revenue loss by taking away tax incentives, and how the burden for the revenue that would be offset is primarily on families with an income below $200,000. Think about a 1 percent tax decrease on 1 million dollars. That's $10,000 back in somebody's pocket as opposed to being sent to the government as a tax. That same 1 percent cut on 50,000 dollars is only $500 away from the government and back in a citizen's pocket.
Most of the revenue being lost by the government under Romney-type cuts is from people in extremely high tax brackets. However, the type of tax incentives that could conceivably be cut save people with a lower income a lot more money than people in high-income brackets, at least proportionally speaking, so people in lower tax brackets would be picking up the slack for people in higher brackets. This doesn't really make sense. So, best case scenario, Romney actually does something to offset the revenue decrease his cuts would create, and the little guy still suffers.
As I mentioned before, the actual scenario as of right now is a $465 billion loss with a promise of some plan that does something to generate $465 billion. I'm going to assume the loss until I actually see a plan that tells me otherwise. In this case, everybody pays less taxes, and again the people in high-income brackets get way more money back because 1 percent of a lot is much larger than 1 percent of a little. I'm also going to assume that if the government loses 465 billion dollars it won't be able to pay for as many things. I think that if the government couldn't pay for as many services as it used to, the poorer people would again suffer more than the rich people.
There is also a common conservative view that cutting government spending and programs would be the way to offset the lost revenue. I feel like cutting spending on things like welfare or even education would still disproportionately hurt people with lower incomes as opposed to people who make more money.
The only people who realistically have a reason to support Romney's tax plan are rich people. All rhetoric and political posturing aside, his tax plan will make the rich people richer and put more of a burden on poor people, and the United States' already debt-ridden government. So, I don't care than Ann Romney isn't an average housewife, or that Mitt Romney owns lovely white horses. You can even put aside however Mitt Romney feels about abortion, or LGBT rights, or any hot button social issue. He is basically running on this financial platform above everything else, and it's bad enough to keep me from supporting Romney regardless of his stance on anything else.
Uncle Ben
11:54 am on Friday, August 10, 2012
Wow, Thanks for the new Dartboard...
Ray Andrews
11:59 am on Friday, August 10, 2012
I'm not a fan of Romney's, but .... you really should have waited until you had something clever and/or relevant to post. The childish stuff is really childish, and getting old on both sides
Steve
4:54 pm on Friday, August 10, 2012
Agreed there William D, I too need a new photo, because the one I had of Obama to scare the rats away in my basement is now having the reverse effect.
Rather than scaring all the rats looking for a free meal away, it seems to be attracting them.
Maybe with this Romney photo, the rats will finally get the word that there's no more free lunches to be had.........
Thanks Patch!
Uncle Ben
7:53 pm on Friday, August 10, 2012
Yeah Steve I hear ya there, maybe you should clean your back yard, lol or the City should, or maybe even the State. and I say that with humor because I know more than others, lol
Uncle Ben
1:18 pm on Friday, August 10, 2012
lol Thank for the input... I have a vision and he is not in it, and I can say how I feel anywhere, anytime, and to whoever I choose. always 1 of you trying to roul someone up, i'm happy knowing I did you, lol dummy
Jack Baillargeron
1:44 pm on Friday, August 10, 2012
The problem with all that mish mash you have put out, is hat the Romney Tax plan is not even out or finalized for that matter. As usual canidates give broad strokes until the after the convention. The reason being that debates are when you need specifics and like all canidates and the incumbent, that is when you get to the nitty gritty.
That study assumes numbers and senario's that are just guesses and assumptions not based on any facts. It is no different then Ried saying he paid no taxes and has yet to say where the proof of that is.
Think I will wait until I see the actual plan in writing. Rather than base something on an ill conceived fantasy report. I did the same thing with healthcare reform and waited to read it, though I had to wait until it was passed to get it. lol
There lays the problem with attempting a gotcha moment with no facts Zane. Sorry but in my opinion you failed totally and the people are not that foolish in my opinion also to fall for this crappola again like the last election, no matter what side is doing it.
Not Leo Fontaine
2:55 pm on Friday, August 10, 2012
This is the best we can do in a nation of 312 million people,the U.S.is definitely in decline.
Ray Andrews
3:42 pm on Friday, August 10, 2012
Seriously Bristol/Warren Patch, your blogs/forums are becoming a joke. At least pretend you care
Ray Andrews
3:43 pm on Friday, August 10, 2012
Zane, that wasn't meant as a reflection upon your post.
Zane Wolfang
7:56 pm on Friday, August 10, 2012
Quite alright Ray. Jack, the article was more of an attempt to elucidate the meaning of this report for people who didn't want to crawl through the 15 pages of economic jargon than a "gotcha moment" of some type. I thought the report from Brookings was something more people should be exposed to, and I posted the link to the actual report so that people could compare what I said to what they said. That's also why I included the abstract of the report, so that people could see that what I was saying about how the reforms would affect different income brackets was the conclusion of a professional report rather than mere postulation from a college student. CNN brings up the same report in the front page article of their "politics" section, posted today: "His tax plan, the release of which was intended to offer a punctuation mark on how he'd handle the economy, was criticized by the Urban-Brookings Tax Policy Center. The plan would provide large tax cuts to the very wealthy while increasing the tax burden on the lower and middle classes. It would make it tough to recoup lost government revenue, according to the Brookings study," (http://www.cnn.com/2012/08/10/politics/romney-trajectory/index.html) It seems that at least one national news media outlet has also deemed this report to be an acceptable source. I don't think that what I wrote was "mish mash" so much as an explanation of an economic report and then an opinion derived from that explanation.
Jack Baillargeron
2:12 am on Saturday, August 11, 2012
I am not trying to offend you Zane. I am merely tired of these institutions and media, who start tearing everything apart on both sides for the last decade. They assume so much and jiggle numbers to suit their position.
There is nothing on the Mitt web site of his ideas that even comes close to saying he will screw the everyone except the rich.
Jack Baillargeron
2:21 am on Saturday, August 11, 2012
Should add that this is the same thing that hapened to Obama when he ran and kept going around the country saying his plans would provide healthcare to everyone, (it did not and actually many will lose it, there is also million that will still be with out healthcare). But thats another subject ;-}.
The fact is that when he saifd these things and many others including tax cut for the middle class, the poor etc. Depending on which biased institute or media, you read about. they all have opossing views, with out facts, because no details were ever put out by Obama on exactly what or how he would do it. The big question is not the what, but the how.
With out that. There is no way to come to a conclusion of these so called plans. They are not plans,they are talking points until they are in black and white, with how the idea's will be applied in the real world. Not the world of fantasy and assumption in my opinion.
Uncle Ben
8:04 pm on Friday, August 10, 2012
Zane, you should look into getting a thumbs up option, becase I'd give you 1 here.
Jack Baillargeron
2:08 am on Saturday, August 11, 2012
Lets look at the Mitt Web site strokes. This is from his site. You will notice that it is not in detail at all just idea’s put forth period.
Individual Taxes
Make permanent, across-the-board 20 percent cut in marginal rates
Maintain current tax rates on interest, dividends, and capital gains
Eliminate taxes for taxpayers with AGI below $200,000 on interest, dividends, and capital gains
Eliminate the Death Tax
Repeal the Alternative Minimum Tax (AMT)
Corporate Taxes
Cut the corporate rate to 25 percent
Strengthen and make permanent the R&D tax credit
Switch to a territorial tax system
Repeal the corporate Alternative Minimum Tax (AMT)
How anyone can glean from that an actual tax plan is beyond belief in my opinion. That’s all I am saying. The media and bias institutions on both sides do this all the time. My problem with you story is the fact you provide it as truth, when it is actually subjective theory and therefore an exercise in futility with out the details.
That is something I personally am tired of, as I said with the healthcare; it was the same until we had the actual bill that was debated. To decide your vote on theories and unfounded research is a sad state of affairs to me and foolish.
No I have not decided yet who I will support, other than Obama being throw out on his ear. It is my own opinion he has proven he is incapable of doing anything to help the economy period.
Bryan Palumbo
4:10 pm on Sunday, August 12, 2012
Well written, Jack. You should include a link to Mitt's plan as well.
Great blog, Zane. Thanks.
Jack Baillargeron
10:47 pm on Sunday, August 12, 2012
Thought I did Bryan lol.
http://www.mittromney.com/issues/tax