Romney's Tax Plan Still Makes No Sense

For my part, the most incredible exchange of the first presidential debate came in the first 20 minutes, when President Obama hit Mitt Romney on his tax plan—which would implement across-the-board cuts to marginal rates—and the Republican nominee responded by denying its existence. Romney insisted that his plan would not cut upper-income taxes (it calls for a 20 percent reduction) and, in fact, would end breaks for upper-income taxpayers (he has yet to give any detail on this score).

The Tax Policy Center, on the other hand, found that there was no way for Romney to accomplish his goals—tax cuts, fewer loopholes, revenue neutrality—without significant tax increases on some group of taxpayers. The Romney campaign has repeatedly dismissed the study. Today, the co-director of the Tax Policy Center, William Gale, offers a response:

Suppose Governor Romney said that he wants to drive a car from Boston to Los Angeles in 15 hours. And suppose some analysts employed tools of arithmetic to conclude that “If Governor Romney wants to drive from Boston to LA in 15 hours, it is mathematically impossible to avoid speeding.” After all, the drive from LA to Boston is about 3,000 miles, so to take only 15 hours would require an average of 200 miles per hour. Certainly other road trips are possible—but the particular one proposed here is not.

With a few substitutions, this is almost exactly how the tax debate has evolved. Substitute “the various tax cuts Romney has proposed” for “driving from Boston to LA”; substitute revenue-neutrality for “in 30 hours"; substitute ”tax increases on households with income below 200k and tax cuts for higher income households“ for ”speeding" and you have the basic story: Romney can’t do all of the tax cut proposals he has advocated, remain revenue neutral, and avoid taxing households with income below $200,000 or cutting taxes for higher income households.

Reporters who assert that Romney has moved to the center would do well to read this: Aside from his rhetoric, Romney has done nothing to suggest a genuine move toward the center of American public opinion. At most, he’s adopted the pose of a moderate while pursuing the same right-wing tax policies that will require either a massive tax hike on ordinary Americans or huge new deficits (which, given the state of the economy, actually wouldn’t be a bad thing).

You could dismiss the tax plan as a sop to the right wing—a necessary concession that the “real” Romney has to make. But I think that’s mistaken.

To return to a point I made earlier this year in my cover story for the June issue of the magazine—echoed recently by Ezra Klein and Ed Kilgore—there’s little chance of Romney’s administration reflecting his moderate rhetoric. If Romney wins the White House, there’s a good chance that Republicans will also win the Senate—Democrats are defending a disproportionately large number of seats this year—and maintain their majority in the House of Representatives.

When a President Romney faces political pressure, the vast majority of it will come from the right. He is less likely to be the moderate technocrat who governed Massachusetts, and more likely to be the Republican president who signs the Ryan plan (or some variation) and further’s the GOP’s ongoing assault on the welfare state.

Comments

I think the difference here is that the Tax Policy Center assumes away the the increased growth caused by the 20% marginal rate reductions.

... because there's no empirical evidence to support the proposition that the (ostensibly revenue-neutral) rate reductions will increase growth.

Okay, if Romney's plan doesn't add up OR make sense, what does Obama's plan fall under? $1 trillion over budget.

Stop pointing fingers at the insignificant, and address the REAL issue like a REAL journalist.

And if there were no specifics given, then Romney's plan couldn't be empirically tested, then any conclusions that it is irrelevant is moot.
Again, Obama has the reins, and we see his plan of only taxing the rich was a drop in the bucket. Why didn't the media catch on to what Obama's plan added up to? -$1 TRILLION

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