Mitt Romney will cut your taxes — but won’t tell you how

“Give me an example of a [tax] loophole that you would close?” asked “Meet the Press” moderator David Gregory of Republican nominee Mitt Romney.

Replied Romney: “I can tell you that people at the high end, high-income taxpayers, are going to have fewer deductions and exemptions. Those numbers are going to come down. Otherwise they’d get a tax break. And I want to make sure people understand, despite what the Democrats said at their convention, I am not reducing taxes on high-income taxpayers,”

Perhaps Romney has some problems with the concept of “an example.” But more likely, Team Romney has decided to see if they can get all the way to Election Day without disclosing the details that would make it possible for voters to ascertain whether his tax plan adds up.

I appreciate Gregory’s question. I wished he had pressed harder. I wish he had said precisely that he had asked for a concrete example and received only a glittering generality. If he had not received the specifics, I wish he had asked Romney how he could justify not disclosing the deductions and exemptions that he proposes to reduce or eliminate. Romney should be asked those questions at every opportunity until he answers them. And frankly, he needs to provide more than one example of a loophole he would close. He needs to put out the plan so neutral experts can assess whether it’s possible for the plan to do all the things that Romney says it will do or whether it is a spectacular pander.

Gregory’s interview with the Romneys, conducted over two days and aired Sunday on “Meet the Press,” lasted more than half an hour. The interview was billed as “clarifying” the “specifics” of Romney’s policy proposals, but very little actually got clarified.

The other headline from the interview, for example, is that Romney said that when he repeals the Obamacare law, he will maintain the guarantee of insurance for those with pre-existing conditions. Two problems with that as a “specific.” That very popular element of the Obama program would bankrupt the private insurance companies, or drive premiums through the roof, unless it is coupled with the other elements of the Obama law, specifically the requirement that everyone, including healthy young “free-riders,” get insurance or pay a penalty/tax. Until we hear specifics about how Romney would address that issue, his new promise to preserve the guarantee of coverage for those with pre-existing conditions is like his promise to cut everyone’s tax rate without adding to the deficit.

The tax plan starts with a cut of 20 percent in all of the marginal tax rates. The wealthiest families currently pay 35 percent on joint adjusted gross income over $357,700, so Romney’s rate cut would reduce that by seven points to 28 percent. The least wealthy taxpayers, who pay a marginal rate of 10 percent on adjusted gross income of $16,050, would get a cut of two percentage points to 8 percent.

Everyone’s rate goes down and Team Romney is willing to be quite specific about how much it goes down. In a piece this morning about Romney’s tax plan, the New York Times said the rate cuts by themselves would bring down federal revenue by hundreds of billions of dollars.

But the plan is also supposed to “revenue neutral,” meaning it raises as much revenue as the current tax code and adds nothing to the deficit. And, Romney also claims, it will not make the tax code more regressive. He specified to Gregory that the share of taxes paid by the wealthy will not go down (Romney: “We’re not going to have high income people pay less of the tax burden than they pay today”), and I guess it will even make the distribution of the tax burden it more progressive (“I do want to bring taxes down for middle income people”).

There seems to be an arithmetic problem with a plan that brings taxes down on the middle class but doesn’t raise them on the upper class but is revenue neutral. Maybe it’s the magic of supply-side stimulus? Or maybe Romney believes his plan actually will raise taxes on the upper class despite the fact that it starts by cutting the marginal rate for the upper class by seven percentage points. Dunno. He won’t say.

The key missing ingredient is, of course, the changes he would make in deductions, credits and exemptions. The liberal-leaning Tax Policy Center says it’s not possible to make all the moving parts by changes in credits and deductions. In his interview with Gregory, Romney said other studies have disagreed. Well this should be easy to settle.

Tell us please, preferably before Election Day, which deductions, credits and exemptions you will eliminate or reduce or change or whatever so that the wealthiest families, despite getting a seven-percentage-point cut in their marginal rates, will not get a net cut.

Comments (16)

  1. Submitted by Hiram Foster on 09/10/2012 - 10:28 am.

    Mitt Romney is a typical baby boomer, self involved, entitled, unable to grasp that the things he wants have to be paid for.

  2. Submitted by Paul Brandon on 09/10/2012 - 10:46 am.

    The Middle Class

    Fewer deductions and exemptions will hurt the middle class much more than the rich.
    People like Romney don’t have mortgages, and most of their income is not earned.

    • Submitted by Frank Phelan on 09/10/2012 - 07:16 pm.

      Equal Isn’t Always Equal

      The mortgage deduction for $200K/year family with a $300K mortgage is worth more dollars that that of a $60K/year family with a $110K mortgage.

      Giving all families a $5K/year housing tax credit would cost the Treasury less than the current mortgage deduction, which benefits not nearly as many families as you may think.

  3. Submitted by Mark Stromseth on 09/10/2012 - 10:52 am.

    Mitt the Liar

    David Gregory is a lighweight buffoon for an interviewer; he doesn’t know the issues, or even the facts, and he’s deferential to those in power or who may be in power, which explains why he and Romney are so vapid, and voters never get any facts from GOP candidates.

    As for Mitt’s claim that he’d preserver the requirement of coverage of pre-existing conditions, his campaign flaks claimed a few hours after that interview aired that he did not mean what he said, so Mitt’s a liar.

    Aside from all that, we already know that there is no way to cut taxes, be revenue neutral, balance the budget, eliminate the budget deficit and national debt, and still keep paying for all the things we expect and need. The fact that Mitt can’t name a single tax “loophole” he’d eliminate, or even be specific as to his economic “plan” he claims to have is ample evidence of his duplicity and idiocy.

    Might as well call him Bozo the Clown.

  4. Submitted by Neal Rovick on 09/10/2012 - 10:55 am.

    Didn’t Nixon have a secret plan, also?

    The Ryan budget INCREASES the debt, and in fact, does not balance the budget until 2040, and only then with unrealistic growth assumptions.

    What do the “debt hawks” have to say about that?

    The triumph of hope over reality.

  5. Submitted by Nathan Roisen on 09/10/2012 - 11:13 am.

    It’s over

    Mitt’s campaign just ended with his statement that he “likes parts of Obamacare”.

    To say so is complete heresy to his base.

    It also opens himself up to two charges, neither of which is palatable, and both of which the Dems will hound him with for the next two months.

    One: he is ignorant of the complicated workings of the health care system, so much so that he does not understand the relationship between the popular parts of Obamacare and the necessity for the mandate to make them possible. How can we trust him to make decisions about a system that he clearly doesn’t understand?

    Two: he is cynically calculating that voters are too ignorant to understand that health care reform involves tradeoffs. He wants you to think that he can deliver positives without the negatives, the sugar without the medicine, and so forth. This despite the fact that his party attempted to establish itself as the sober, responsible ones in the room at their convention.

    I think Mitt is getting scared and desperate.

  6. Submitted by Wayne Cox on 09/10/2012 - 12:02 pm.

    BIG TAX CUT FOR THE TOP REGARDLESS

    Citizens for Tax Justice’s analysis of Romney’s tax proposals conclude millionaires will receive massive tax cut even if all possible deductions are eliminated:

    From CTJ report:

    “The question is not whether the rich will get a tax cut under Romney’s plan,” said CTJ director Robert S. McIntyre. “The question is how big the break for the richest Americans will be. We estimate that millionaires would get somewhere between $250,000 and $400,000 on average in 2013 if the plan was in effect then, no matter how Romney fills in the gaps – which are many.”

    A recent CTJ report concluded that if Romney’s plan was in effect next year, people making over $1 million would get an average tax cut of $250,000 even if these wealthy taxpayers have to give up all of the tax loopholes or tax expenditures that Romney has put on the table. (This average break of $250,000 includes about $146,000 that millionaires would receive on average if Congress extended the Bush tax cuts in effect today but made no other changes.)

    In other words, for very high-income taxpayers, the value of the tax rate reductions and other new breaks spelled out in Romney’s plan far outweigh the value of all of their tax loopholes and tax expenditures – meaning it would be impossible for Romney to implement his plan without lowering their taxes substantially.

    Read more at http://ctj.org/ctjreports/2012/08/how_big_is_the_romney-ryan_tax_cut_for_millionaires.php

    Wayne Cox
    Executive Director
    Minnesota Citizens for Tax Justice

  7. Submitted by Rich Crose on 09/10/2012 - 12:34 pm.

    Decisions, Decisions…

    Do I vote for a man who promises to cut my taxes with voodoo economics or do I vote for a man who actually cut my taxes twice in 2 years?

    I’m still waiting for my trickle-down from the Reagan years.

    (Ignore that rich guy behind the curtain.)

  8. Submitted by Pat Missling on 09/10/2012 - 01:05 pm.

    Ryan has decided

    Paul Ryan made public his decision about the mortgage and charitable deductions on August 2 when he voted NO (along with all but a few Republicans) on a Democratic motion to retain those deductions. That motion was made because the Republican bill to overhaul the tax code did not identify tax breaks they would repeal. Voting NO along with 232 other Republicans is taking a position.

  9. Submitted by Andrew Pratt on 09/10/2012 - 01:54 pm.

    Inconsistent

    This column ripped Romney for not providing more specifics on tax code reform (never mind that Pres. Obama offers hardly any specifics for a second term), but Mr. Black’s prior column lauds Obama for not making any promises he cannot keep for a second term. Isn’t it better to have both candidates be as specific as possible so voters can make a reasoned decision? Or is that obligation only on the Republican candidate?

    • Submitted by RB Holbrook on 09/10/2012 - 02:47 pm.

      Specificity

      Isn’t there a difference between not making unkeepable campaign promises and refusing to articulate policy? If Romney thinks he can reform the tax code in a way that is revenue neutral, don’t you think we should know how he intends to do this?

      Voters can’t make a reasoned decision without knowing something of a candidate’s thinking. President Obama has been in office for four years. We should know something of his thinking. Romney has made vague proposals for a tax plan that, on the face of it, sounds like a bunch of nonsense. Unless he expects to win election by capturing the “anyone but Obama” vote, he should give a few details of his plans.

  10. Submitted by Richard Schulze on 09/10/2012 - 08:45 pm.

    There is no Romney program—a program is complete, coherent, and scoreable, Romney has repeatedly said that his statements are not scoreable. In order to estimate the economic effect of any program, you have to know what its pieces will do–you need to have it scored. Until Romney presents a complete and coherent program with scoreable pieces team Romney has no basis for asserting anything about its economic impact.

    One of the most annoying things here is the partisan asymmetry: the rules of the game seem to be that Democratic proposals have to be scoreable and coherent, while Republican proposals don’t.

  11. Submitted by Paul Brandon on 09/11/2012 - 09:33 am.

    Businessmen

    are supposed to have business plans.
    The fact that Romney has none (aside from his own business of getting elected) says something about his competence as a manager.

  12. Submitted by Thomas Swift on 09/11/2012 - 10:06 am.

    Difficult task…

    It’s got to be really tough to craft a tax plan that excludes those already paying 80% of the total bill.

    I’m thinking the only way Mitt is going to silence leftist haters is to line everyone making more than $250k\yr against a wall.

    • Submitted by Rich Crose on 09/11/2012 - 12:04 pm.

      You have to tax the rich.

      They are the only ones with any money. The right wing doesn’t want anyone to know how wide the wealth gap is in this country.

      If you had a dollar bill and wanted to divide it between 100 people using the same ratio as how the wealth is distributed in this country, 1 person would get 37 cents, 19 people would get 3 cents and the other 80 people would divide up the remaining 6 cents –about a 10th of a cent per person. That’s $0.0013 per person!

      Yet you want those people to pay their fair share.

    • Submitted by Richard Schulze on 09/11/2012 - 09:21 pm.

      You must be referring to David Stockman, the wild-eyed leftist radical who ran Ronald Reagan’s budget, who calls Mr Ryan’s budget plan “devoid of credible math or hard policy choices”.

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