WASHINGTON, September 17, 2012 — What’s Mitt Romney’s tax reform plan? The GOP presidential nominee ain’t saying. Nor is his running mate Paul Ryan. Mum’s the word.
They have devised a secret plan to lower the deficit and create jobs by reforming the tax code. Only they aren’t tell us what it is. We will have to wait until after the election when they will unveil it. Basically, they are saying, “Just trust us.”
Beware secret plans. Remember President Nixon’s secret plan to get us out of Vietnam? How well did that go? And “Trust me” is not a great campaign slogan in these times.
So why are Romney and Ryan so silent on their grand plan, the one to save America? Why no details even when asked directly? What are they afraid of?
Most likely they know their so-called tax reform will send up wails of outrage from the very voters they want to vote for them not to mention the squealing from those fat cat donors who like their deductions and, of course, howls of anguish from charitable institutions, who like the benefits of those deductions.
Everyone Is Miffed
Everyone is also miffed that the Romney-Ryan secret plan seems to require a decoder ring to find out what’s what. Even conservative columnist George Will shook his head in despair at Romney and Ryan’s reluctance to come clean with the American public and stop the game-playing.
On ABC’s Sunday show “This Week,” Will had said: ”There is uncertainty surrounding the Romney-Ryan tax cut plan, because they have not specified the deductions that will be closed. And we know where the big money is: mortgage interest deductions, charitable deductions, taxing that’s compensation [sic], which it is, employee-provided health insurance, and state and local taxes. All of those, you either hit only the rich, in which case you don’t get much money, or you hit the middle class.”
Basically George Will gave away the secret plan and no wonder no one would be thrilled with it. And no wonder Romney and Ryan, if they are elected, want to hand off their secret plan to Congress and let them deal with it. It is truly a hot potato. Too hot to talk about during an election.
However, using an old decoder ring from a stale box of cereal, here is what I’ve decoded about Romney’s tax plan:
Romney/Ryan wants to cut everyone’s tax rates by 20%. To pay for that he would eliminate some of the loopholes for people in his tax bracket (top 5%) and get rid of some of the deductions that everyone in all tax brackets use. Making those adjustments, Romney insists, along with accelerated economic growth, would result in lower taxes that would raise gobs of revenue for the government. Voila! Like magic. Trust me.
Romney told David Gregory on “Meet the Press,” “We are not going to have high income people pay less of the tax burden than they pay today. That’s not what’s going to happen. I do want to bring taxes down for middle income people.”
Hmmm…and just what are those deductions that he will eliminate from our tax forms? That Romney would not divulge. Top secret.
Most likely, George Will is right and they will be deductions for mortgages, state and local taxes, and charities, three of everyone’s big favorites at tax time. However, Romney has pledged never, ever to get rid of deductions for savings and investment. Those deductions are very popular with the Fat Cat set.
And, off course, Romney and Ryan have already bragged they would banish the estate tax so that would be gone. No Republican worth his salt is for estate taxes. But that is another tale for another day.
How Fair Is the Secret Plan?
Let’s look at mortgage deductions, the middle class home owner’s favorite teddy bear. Always a biggie at tax time, that deduction saves a lot of folks a lot of moola. And Romney wants to zap it out of the tax code. Yes, yes, millionaires and zillionaires would also find they could no longer deduct their mortgage payments and theirs are so much bigger yours and mine. So everyone is suffering. Sounds fair, doesn’t it?
However, here’s the dirty little secret that Romney and Ryan, both millionaires, don’t tell you: Rich people don’t usually make mortgage payments. Nope. They buy their million dollar properties outright. Most have never even seen a mortgage statement. So guess what? They are not going to rant and rave about those deductions disappearing. They never had to use them.
Getting rid of charitable deductions, which has always helped the wallets of the rich and the bottom line of charities — from museums to the Red Cross and United Fund to church-affiliated organizations — would be like a punch to the head of those organizations. Many fewer zillionaires would now build a wing on your local hospital or museum if they aren’t getting a hefty deduction for their efforts, even if their name is on the building. For many smaller, less-known charities, it could mean the end.
So would the secret tax plan actually work, assuming Romney could even wrangle it through a Republican Congress?
The Tax Policy Center (TPC) as well as economists from across the political spectrum have looked at what the Romney-Ryan plan outlines and divining from what they can gleam from what the candidate has allowed us to know, the resounding answer is No. Or as Bill Clinton put it at the Democratic Convention, it all comes down to arithmetic.
The Math Just Doesn’t Work
TPC, a non-partisan group, did a preliminary analysis of the Romney-Ryan proposal for tax reform and found that it would result “in a net tax reduction for the top 1 percent and for taxpayers making more than $200,000, and a net tax increase on taxpayers earning less than $200,000.” Yikes! That hurts.
Just how much would the average middle class taxpayer end up paying with the Romney-Ryan plan? Up to $2,000 a year. CNN’s Fact Checker doublechecked that number when the Democrats started hurling it about, and, guess what: The number is right and not election year rhetoric.
Nor would the secret plan cut the deficit, but rather increase it by $456 billion a year, starting in 2015.
To add insult to injury, the analysis by the Congressional Research Analysis released last Friday and reported on by the Wall Street Journal, certainly no bastion of Liberalism, finds that “tax cuts for the rich don’t seem to be associated with economic growth.” What they do promote is more income inequality with fewer people being able to benefit from the economic pie. Romney’s scheme to stimulate the economy by giving more of the pie to the wealthy just doesn’t work. Trickle down economics never do.
The take-away from all of this is that the voters cannot trust the Romney-Ryan plan to improve the economy much less their own lives. The secret plan is, if anything, a plan for disaster, worsening the economic tailspin, not pulling us out of it.
No wonder Mitt Romney refuses to release any details of the tax reform plan. Voters would not be happy campers if they knew the truth.
To contact Catherine Poe, see above. Her work appears in Ad Lib at the Communities @ WashingtonTimes.com. She can also be heard on Democrats for America’s Future. She is also a contributor to broadcast, print and online media.
This article is the copyrighted property of the writer and Communities @ WashingtonTimes.com. Written permission must be obtained before reprint in online or print media. REPRINTING TWTC CONTENT WITHOUT PERMISSION AND/OR PAYMENT IS THEFT AND PUNISHABLE BY LAW.