September 12, 2012
Bergin: Tax Policies of Romney, Obama Make Me 'Sick to My Stomach'Christopher E. Bergin (President, Tax Analysts), Where’s the Tax Plan, Man – Uh, Men?:
In a taped interview, host [Meet the Press host] David Gregory repeatedly asked Romney for details of his tax plan. He ended up practically begging for just one detail – any morsel, please. He got zip, zilch, nothing. I don’t care that much about Romney’s personal income tax returns. I can even think of several legitimate reasons why he wouldn’t want to release them. ... But I can think of only one reason why Romney consistently won’t reveal the details of his tax plan. He doesn’t have any! Other than to take care of his rich friends. ...
Meanwhile, back at re-election central, President Obama in his convention acceptance speech last week said that he wants to work for tax reform. No he doesn’t. His first term amply illustrated what I was worried about all along: President Obama doesn’t care a lick about tax reform – which is his perogative, by the way. All he cares about is increasing taxes on the folks he thinks are rich – which actually includes a lot of middle-class households.
From a tax policy standpoint, the choice we have in this upcoming presidential election makes me sick to my stomach.
(Hat Tip: Going Concern.)
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I believe President Obama's most serious error so far was his agreement to extend the Bush tax cuts for a year. He compounded that error by not demanding and receiving agreement to raise the debt ceiling as a quid pro quo for extending the Bush tax cuts. This will return haunt him, assuming he is re-elected. Romney's tax "plan" isn't even worth comment.
Posted by: Publius Novus | Sep 12, 2012 3:29:19 PM
"From a tax policy standpoint, the choice we have in this upcoming presidential election makes me sick to my stomach"
Come on, when has an American election for president ever "provided" a "choice" for the electorate? Tweedle Dee versus Tweedle Dum every time for the last 150 years or so. That is a long time to be sick to the stomach.
Posted by: Steve | Sep 12, 2012 3:42:01 PM
This kind of crap shows exactly why politicians care about themselves and winning. Nothing else. If they want to solve our problems they would at least show some of their ideas....we know it is not written in stone. where are we going.....oh, trust me I am a businessman or I have 4 years of experience. bull....with congress and presidential candidates....If you don't have and idea and/or won't tell us....move over and let someone else run....
Posted by: Sid | Sep 12, 2012 5:24:46 PM
There has never been a tax reform in which proponents attempted to gain approval for eliminating specific deductions before presenting the entire package. You can't sell tax reform by presenting one unfavorable element at a time and then finally calculating the revenue-neutral tax rate. That process has to occur before the package is presented.
This is a political process involving horse trading. There's no point in constructing a complete tax reform plan outside the political process. That would only ensure its failure and the failure of the candidate proposing it. The latter is the objective of people claiming to want the details. They set up a booby trap and criticize their adversary for not walking into it. They're not fooling anyone with that complaint.
Everybody knows that tax reform will leave today's heavy users of tax breaks paying more than they do now, and light users of tax breaks paying less. The details cannot and should not be negotiated with the media. They need to be negotiated only with the decision makers, namely Congress.
In my opinion tax reform should follow rather than precede spending reform, since only after spending reform will we know how much revenue is needed when.
Posted by: AMTbuff | Sep 12, 2012 5:28:24 PM
The general theme is correct, and it is true that Mr. Obama has no interest in tax reform, no knowledge of tax issues and no tax reform plan.
But it is not true that the limited aspect of Mr. Obama's program, the plan to restore Clinton era tax rates on people making over $250,000 is a tax increase on the middle class. Sorry, it's just not true.
Posted by: David R. | Sep 12, 2012 7:44:51 PM
Bergin publishes useful tax newsletters yet fails as a pundit. But, to be fair, he succeeds as a blowhard.
Posted by: Jake | Sep 12, 2012 9:12:48 PM
Thanks Jake. I'm sure Romney will consult with Bergin on tax reform. If I were Romney I would say simply that tax reform should be patterned after the 1986 act. Only this time go farther/further.
Posted by: greg | Sep 13, 2012 10:54:07 AM
I don't disagree with your thought but the lack of discussion about the budget or tax reform with the media results in hidden agendas and a lack of disclosure of your thought process. Again ...elections are trust me and I will negotiate this behind closed doors because I am afraid to discuss it out in the open.
Posted by: Sid | Sep 13, 2012 11:01:58 AM
AMTbuff, you are far too rational for the times. Much of what you say is true, but is rather naive. Holding off tax reform until "we know how much revenue is needed when" would be the way to go, except that the right wing doesn't really care to know how much revenue is needed. The conservative mantra of today is "small government," cut the budget, cut regulations. Conservatives never attempt to define HOW small the government should be, and therefore, any attempt to determine how much revenue is needed to run that "small" government is doomed.
As respects negotiating with Congress, that appears to be a relic. Republicans do not negotiate any more--they have pledged NEVER to raise taxes. It's "my way or the highway," and if the U.S. goes off a fiscal cliff, they don't care so long as taxes are NEVER raised and their Tea Party wing is mollified.
Posted by: Publius Novus | Sep 13, 2012 11:58:11 AM
Sorry, but $250,000 IS the middle class in many parts of this country.
Posted by: Timothy Kelly | Sep 13, 2012 12:15:26 PM
There is far more willingness on the right to increase taxes than progressives believe, provided that spending is restructured first. Once the new taxes are seen as not throwing good money after bad, I predict 75% or greater support for them.
Gene Steuerle in his latest "The Government We Deserve" blog post agrees with my earlier point on specifics:
"During a campaign, I don’t want or expect politicians to identify whose taxes would be increased or benefits cut. Such actions would be political suicide and unrealistic, to say the least. Broad-based reform requires more thoughtful analysis than is possible in an electoral process dominated by sound bites and tweets."
As I said, complaints that a candidate refuses to commit political suicide are disingenuous. Gene adds:
"Campaigns and politicians, however, should at least identify the types of structures they would construct. God forbid that their media consultants tell them how to specify, piecemeal, the plumbing, engineering and architecture of governance involved. I simply want those running for office to admit that government taxes and spending programs fundamentally have to be restructured in ways that are likely to ask something from all of us, not just 1 or 2 percent."
Ryan has more than met that test. Some people thought he crossed the political suicide line, but the public senses a fiscal storm coming. The closer it gets, the more explicitly politicians can describe their proposed policies.
Posted by: AMTbuff | Sep 13, 2012 2:21:30 PM
@ Timothy Kelly
No, $250,000 is not middle class in many parts of the country.
The median family income, as just reported by the Census Bureau for 2011 is $50,054, about 20% of your $250,000. The entry point to get into the top 5% in income is about $186,000 (see Table A1 of the Report).
Posted by: David R. | Sep 13, 2012 6:49:09 PM