Sunday, 21 December 2014 / TRUTH-OUT.ORG

Politics Aside, There's No Debating the Scary Facts of Romney's Tax Policy

Friday, 05 October 2012 00:00 By Imara Jones, Colorlines | Op-Ed

In his debate with President Obama last night, Mitt Romney took another step in a process begun with his 47 percent comment: a reevaluation of whether he knows the U.S. well enough to serve as its president.

Throughout the exchange with Obama, Romney's comments begged the question of whether he understands fundamental economic truths, as well as the national programs that provide the vast majority of Americans with a shot at climbing the economic ladder. These economic opportunity and social safety net programs, especially in the areas of health and education, are vital to people of color. Romney would be ultimately responsible for them as the nation's chief executive.

Much of the post-debate commentary has applauded Romney's performance, citing his ability to have an in-depth exchange with Obama without making the sorts of gaffes that have plagued his campaign. But for the the young, the elderly, and the historically marginalized, Mitt Romney's shaky grasp of the details on display in Denver should be downright disconcerting.

The Truth About Taxes

The debate centered on technical points in two key areas: economic policy and healthcare. A brief trip through some of their complexities shows the broader quandary with Romney's bid for the White House.

On the attack in the opening few minutes, Romney asserted that his tax plan would jump start growth and lead the country out of its worst recession in almost 100 a years. But he provided little evidence that it could do that. In fact, there is conclusive data, released just last month, that suggests the exact opposite.

Two weeks ago the Congressional Research Service (CRS) published a report that shows that tax cuts do not produce economic growth, none whatsoever. The CRS is the policy and analysis arm of the legislative branch.

Using data compiled since 1945, the CRS deduced that "the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth" and "reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth." The CRS therefore lays out the fact that the basic assertion at the heart of Romney's entire economic plan for America is false.

If that were not bad enough, during the debate, Romney showed that he didn't even fully understand the details of his own plan.

By his own admission, his budget plan has four basic elements: 1) reduce federal spending by almost 20 percent; 2) increase defense spending by close to 40 percent; 3) slash taxes and 4) balance the budget. Analysis by the fiercely non-partisan Center on Budget Policy and Priorities (CPBB) of the tax cut embedded in Romney's plan, says that it will lead to $5 trillion in lower taxes for the wealthy. Obama cited this fact throughout the debate.

These cuts, according to the independent Tax Policy Center, translate into tax breaks for the 3 percent of Americans who earn more than $200,000 a year, but tax increases for the rest of the 97 percent below the $200,000 threshold. During his exchange with Obama, Romney rejected these assessments by the non-partisan fact-finders. Strangely, he did not counter with facts of his own.

Instead of detailing his own analysis of what his tax cuts would cost, Romney somewhat confusingly insisted that his tax cut plan couldn't equal $5 trillion in cuts because his "number one principle is there'll be no tax cut that adds to the deficit."

Indeed, as the CPBB lays out, his budget proposals require trillions of dollars in cuts to health, education, infrastructure and scientific research to pay for his tax cuts. Romney's tax break for the 3 percent won't add to the deficit because it will be paid for by everyone else.

The Truth on Healthcare

On healthcare, Romney pledged to "repeal and replace Obamacare." The centerpiece of his rollback is the elimination of the individual mandate, which requires all Americans to buy subsidized insurance. Bafflingly, in the same breath, Romney promised to maintain Obamacare's "pre-existing conditions" provision, which prevents insurance companies from denying coverage due to longterm ailments such as asthma, autism or HIV/AIDS.

The problem is that covering pre-existing conditions is expensive. In order to pay for the added costs of doing so, the insurance companies themselves insisted during the negotiations on Obamacare that the number of people participating in the healthcare system be expanded to help pay for it. That's one of the key reasons for why we have the mandate: it helps underwrite the coverage of pre-existing conditions. Without the mandate, there is no viable way to ensure that people with pre-existing conditions can get coverage.

Romney himself once acknowledged this fact. That's why he included both the pre-existing conditions provision and the individual mandate in his healthcare plan for Massachusetts.

When Obama pointed out that Romney's Massachusetts health care plan was the model for Obamacare, Romney said, "I like the way we did it in Massachusetts." But in a strange move of mental jujitsu, the former governor, went on to deride Obama for taking Romneycare nationwide through Obamacare. What was good for the people of his home state is apparently not good for the rest country.

Romney had a string of additional desultory answers and skewed facts on Medicare, Medicaid and education. On the Obama administration's key education initiative, Race to the Top, Romney said that he "did agree" with the program. However he opposes the $4 billion included in the stimulus plan that established Race to the Top and got it going.

The Debate and the 47 Percent

The series of fundamental debate errors compound an unraveling which began with the infamous "47 percent" comment.

The "47 percent" statement was so damaging not only because, as Maureen Dowd of the New York Times said, "Romney came across ... as a Cranbrook kid at the country club smugly swaddled in class disdain." What really hurt is that his comments showed an in-the-bubble ignorance about the country that he inhabits and wants to run.

Last night Romney only added to this perception.

Disturbingly, he came across as a person in an imaginary America where tax cuts for the wealthy will solve the hardship of the many; where 50 million people can be insured by first being un-insured; and where hollow assertions substitute for real policies.

Perhaps Gov. Romney is qualified to be president of that America. But setting aside for the moment Obama's own challenges on the economy, over the last month Romney has slowly exposed the fact that he may not be qualified to run the country in which the rest of us live. In a year when we need a real and vigorous debate between both parties about our future, his extraordinary detachment is even more worrisome than any of us would like to fathom.

Reprinted with permission of Colorlines.com. Sign up to receive Colorlines Direct, a weekly email digest of key stories on Colorlines.com. You'll get award-winning news from our multi-racial team of writers covering hot topics and a broad range of issues from a racial justice perspective.

This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source.

Imara Jones

Imara Jones is New York-based blogger who writes about economic justice, among other issues, for Colorlines. His site caffeineator.com offers incisive commentary about our disruptive world and what comes next, and he serves as editor of www.slaveryblog.org, an online information resource on the transatlantic slave trade and Afro-Atlantic world.

Imara is also the creator and co-host of caffeinetv, an online television show currently in development. Prior to caffeinetv, Imara held posts at Viacom—where his work garnered two EMMY Awards and a Peabody—as well as in the Clinton White House.

In 2006, Imara was identified by the World Economic Forum as a Young Global Leader; he holds a masters degree in economic from the London School of Economics. Fluent in Portuguese, Salvador, Bahia, Brazil is Imara’s second home. Follow him on Twitter @imarajones.

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Politics Aside, There's No Debating the Scary Facts of Romney's Tax Policy

Friday, 05 October 2012 00:00 By Imara Jones, Colorlines | Op-Ed

In his debate with President Obama last night, Mitt Romney took another step in a process begun with his 47 percent comment: a reevaluation of whether he knows the U.S. well enough to serve as its president.

Throughout the exchange with Obama, Romney's comments begged the question of whether he understands fundamental economic truths, as well as the national programs that provide the vast majority of Americans with a shot at climbing the economic ladder. These economic opportunity and social safety net programs, especially in the areas of health and education, are vital to people of color. Romney would be ultimately responsible for them as the nation's chief executive.

Much of the post-debate commentary has applauded Romney's performance, citing his ability to have an in-depth exchange with Obama without making the sorts of gaffes that have plagued his campaign. But for the the young, the elderly, and the historically marginalized, Mitt Romney's shaky grasp of the details on display in Denver should be downright disconcerting.

The Truth About Taxes

The debate centered on technical points in two key areas: economic policy and healthcare. A brief trip through some of their complexities shows the broader quandary with Romney's bid for the White House.

On the attack in the opening few minutes, Romney asserted that his tax plan would jump start growth and lead the country out of its worst recession in almost 100 a years. But he provided little evidence that it could do that. In fact, there is conclusive data, released just last month, that suggests the exact opposite.

Two weeks ago the Congressional Research Service (CRS) published a report that shows that tax cuts do not produce economic growth, none whatsoever. The CRS is the policy and analysis arm of the legislative branch.

Using data compiled since 1945, the CRS deduced that "the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth" and "reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth." The CRS therefore lays out the fact that the basic assertion at the heart of Romney's entire economic plan for America is false.

If that were not bad enough, during the debate, Romney showed that he didn't even fully understand the details of his own plan.

By his own admission, his budget plan has four basic elements: 1) reduce federal spending by almost 20 percent; 2) increase defense spending by close to 40 percent; 3) slash taxes and 4) balance the budget. Analysis by the fiercely non-partisan Center on Budget Policy and Priorities (CPBB) of the tax cut embedded in Romney's plan, says that it will lead to $5 trillion in lower taxes for the wealthy. Obama cited this fact throughout the debate.

These cuts, according to the independent Tax Policy Center, translate into tax breaks for the 3 percent of Americans who earn more than $200,000 a year, but tax increases for the rest of the 97 percent below the $200,000 threshold. During his exchange with Obama, Romney rejected these assessments by the non-partisan fact-finders. Strangely, he did not counter with facts of his own.

Instead of detailing his own analysis of what his tax cuts would cost, Romney somewhat confusingly insisted that his tax cut plan couldn't equal $5 trillion in cuts because his "number one principle is there'll be no tax cut that adds to the deficit."

Indeed, as the CPBB lays out, his budget proposals require trillions of dollars in cuts to health, education, infrastructure and scientific research to pay for his tax cuts. Romney's tax break for the 3 percent won't add to the deficit because it will be paid for by everyone else.

The Truth on Healthcare

On healthcare, Romney pledged to "repeal and replace Obamacare." The centerpiece of his rollback is the elimination of the individual mandate, which requires all Americans to buy subsidized insurance. Bafflingly, in the same breath, Romney promised to maintain Obamacare's "pre-existing conditions" provision, which prevents insurance companies from denying coverage due to longterm ailments such as asthma, autism or HIV/AIDS.

The problem is that covering pre-existing conditions is expensive. In order to pay for the added costs of doing so, the insurance companies themselves insisted during the negotiations on Obamacare that the number of people participating in the healthcare system be expanded to help pay for it. That's one of the key reasons for why we have the mandate: it helps underwrite the coverage of pre-existing conditions. Without the mandate, there is no viable way to ensure that people with pre-existing conditions can get coverage.

Romney himself once acknowledged this fact. That's why he included both the pre-existing conditions provision and the individual mandate in his healthcare plan for Massachusetts.

When Obama pointed out that Romney's Massachusetts health care plan was the model for Obamacare, Romney said, "I like the way we did it in Massachusetts." But in a strange move of mental jujitsu, the former governor, went on to deride Obama for taking Romneycare nationwide through Obamacare. What was good for the people of his home state is apparently not good for the rest country.

Romney had a string of additional desultory answers and skewed facts on Medicare, Medicaid and education. On the Obama administration's key education initiative, Race to the Top, Romney said that he "did agree" with the program. However he opposes the $4 billion included in the stimulus plan that established Race to the Top and got it going.

The Debate and the 47 Percent

The series of fundamental debate errors compound an unraveling which began with the infamous "47 percent" comment.

The "47 percent" statement was so damaging not only because, as Maureen Dowd of the New York Times said, "Romney came across ... as a Cranbrook kid at the country club smugly swaddled in class disdain." What really hurt is that his comments showed an in-the-bubble ignorance about the country that he inhabits and wants to run.

Last night Romney only added to this perception.

Disturbingly, he came across as a person in an imaginary America where tax cuts for the wealthy will solve the hardship of the many; where 50 million people can be insured by first being un-insured; and where hollow assertions substitute for real policies.

Perhaps Gov. Romney is qualified to be president of that America. But setting aside for the moment Obama's own challenges on the economy, over the last month Romney has slowly exposed the fact that he may not be qualified to run the country in which the rest of us live. In a year when we need a real and vigorous debate between both parties about our future, his extraordinary detachment is even more worrisome than any of us would like to fathom.

Reprinted with permission of Colorlines.com. Sign up to receive Colorlines Direct, a weekly email digest of key stories on Colorlines.com. You'll get award-winning news from our multi-racial team of writers covering hot topics and a broad range of issues from a racial justice perspective.

This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source.

Imara Jones

Imara Jones is New York-based blogger who writes about economic justice, among other issues, for Colorlines. His site caffeineator.com offers incisive commentary about our disruptive world and what comes next, and he serves as editor of www.slaveryblog.org, an online information resource on the transatlantic slave trade and Afro-Atlantic world.

Imara is also the creator and co-host of caffeinetv, an online television show currently in development. Prior to caffeinetv, Imara held posts at Viacom—where his work garnered two EMMY Awards and a Peabody—as well as in the Clinton White House.

In 2006, Imara was identified by the World Economic Forum as a Young Global Leader; he holds a masters degree in economic from the London School of Economics. Fluent in Portuguese, Salvador, Bahia, Brazil is Imara’s second home. Follow him on Twitter @imarajones.

Related Stories

A Nationally-Televised Presidential Fail
By William Rivers Pitt, Truthout | Op-Ed

Hide Comments

blog comments powered by Disqus