'Big Bird' is not the only casualty of Mitt Romney's tax plan
Most voters are not accountants, and they don't always filter through what a revenue neutral tax plan really means. But they will learn fast if Mitt Romney wins the White House.
Revenue neutral is an elaborate way to say that the tax structure will be changed, but it will not bring in any more money. It's essentially a taxing method to redistribute revenue from one group of taxpayers to another. No gain, no loss, just moved.
One would think that bringing in more money would be the most direct way to pay down the national debt. But Romney has had a Republican mind-meld that forbids him from raising revenue to reduce the debt. Therefore, spending cuts are the one-and-only path in Romney's revenue neutral tax plan.
That is not liberal conjecture. It's math a small child could do with a crayon.
So the first question people need to ask is, if shifting wealth does nothing to reduce the deficit, why bother? There are a lot of answers to that question, but we'll focus on Romney's clues in this case.
Romney's argument is one we've heard before from former President George W. Bush.
The economic theory that Romney clings to is called supply-side economics. It is a premise that assumes that if you give wealthy people more money by letting them pay less in taxes, they will use that money to expand their businesses, which is turn is supposed to create demand for more workers.
The Bush tax cuts, which have been in effect for more than a decade, did not prevent any recessions. We had the worse one in 70 years in 2008. On the sluggish recovery side, the rich have gotten richer, while unemployment remains high and wages remain low.
That's what is happening now, which brings us back to Romney's plan to redistribute wealth as G.W. Bush did, only more-so.
Since wealth redistribution favoring supply-side economics has resulted in an increase in the national debt over the past 10 years, and no significant gains in wages or job creation, it is completely logical to ask how the outcome would be different if Romney tried Bush 43's tax plan?
Romney has not actually explained that just yet, but assures the American people that he is a wonderful business man. And even though he refuses to show voters his tax returns, he should be trusted.
That brings us back to the deficit Romney wants to fix without bringing in any new revenue into the Treasury.
Romney is hoping that if he can create 12 million new jobs in four years, the income taxes those people pay will help pay down the debt. So the goal is 250,000 jobs every month for 48 straight months.
It is probably safe to assume that to boost revenue from payroll taxes, Romney will follow his running mate's proposal, which strips-away the Earned Income Tax Credit for low-income families. While not a tax rate increase, it does eliminate tax credits and refunds for millions of lower income Americans.
In keeping with the revenue neutral plan, while the working poor will now be paying more taxes, Romney's tax plan eliminates all taxes on investment income, capital gains, and eliminates the current threshold for inheritance taxes on estates.
At this stage, we have higher taxes for low income workers, and no taxes on stock market winnings and other investment vehicles, which millions of low income and middle class families probably won't be able to take advantage of.
According to Romney, his tax plan is all about priorities.
Eliminating all income taxes on investment income and estates is important. But Big Bird is not worth the $444 million 2012 Public Broadcasting subsidy, so that has to go. So does Medicare as we know it, Medicaid, Social Security, funding for new and existing education programs, environmental protection, food safety, and a whole slew of other "wasteful" programs.
Smaller government also means fewer government jobs, from managers to entry-level clerks. They all have to go because it's not worth borrowing money from China to keep those people on the payroll.
Romney hopes the government workers he plans to fire will get new jobs in the private sector after the wealthy "job creators" use their new tax break money to hire them.
He was unclear as to what sort of work an 80-year-old, blind diabetic might do, or how a baby with a debilitating birth defect would survive with no job and no health insurance. But many Americans are sure he must have something in mind for that.
And let's not forget the disabled veterans who don't make enough money to pay taxes. They are part of Romney's "47 percent."
Romney believes these are parasitic, government-dependent people who will never take personal responsibility for their lives. Still awaiting details on Romney's plan for the Veterans Affairs agency.
Romney's own words might clarify his policy: "There are 47 percent of the people... who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you name it. That that's an entitlement... These are people who pay no income tax. Forty-seven percent of Americans pay no income tax. So our message of low taxes doesn't connect... And so my job is not to worry about those people—I'll never convince them that they should take personal responsibility and care for their lives."
The real Mitt Romney was at the Denver presidential debate on Wednesday, all slicked-up for the occassion.
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