Taxes, Our Taxes

Texans and possibly other Americans not intrinsically hostile to Texas will recognize the post title as a reference to our state song. No, it isn't "The Eyes of Texas," as Texas Aggies will quickly tell you... that song effectively belongs to the University of Texas. And, I suppose, to people workin' on the railroad.

Anyway, King Mitt the Self-Interested has a plan for your taxes. He wants to cut income taxes across-the-board by 20%, and his "pay-fors" (gawd, I hate that term) are the closing of "loopholes" and the ending of "tax breaks." No, he won't tell you which ones, any more than he will show you his own tax returns.

You have seen Mitt's sense of "fairness" on display in his years with Bain Capital: once you understand their schemes, you'd think the candy jars on Bain executives' desks are proudly filled with candy taken from babies. Stealing: it's the new capitalism.

But of course Rmoney pays his share of taxes on all that money, right? Right: in 2010, on his income of $20 million (yes, twenty million smackers), he paid... wait for it... 13.9%. If you're a typical lower-middle-class American, that's less than the rate you paid in the same year... much less. So Mittens, going into the game of tax-and-switch, has a head start on all us poor schmucks.

But of course his new tax plan will remedy that injustice, right? The middle class will get a tax cut along with the wealthy, right?

Wrong.

The Tax Policy Center, a nonpartisan think tank, has published a new study titled "On the Distributional Effects of Base-Broadening Income Tax Reform" by Samuel Brown, William G. Gale and Adam Looney; the full paper is available here [.pdf] and its executive summary says this:

This paper examines the tradeoffs among three competing goals that are inherent in a revenue-neutral income tax reform—maintaining tax revenues, ensuring a progressive tax system, and lowering marginal tax rates—drawing on the example of the tax policies advanced in presidential candidate Mitt Romney’s tax plan. Our major conclusion is that any revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers.

The short explanation? Unenlightened self-interest. It's the Rmoney way. Taxes on the top 5% will go down; taxes on the other 95% of us will go up.

The Obama campaign was quick to respond with an ad:

I am the first to admit that Obama has done too little for lower- and middle-income Americans, and his economic policies have been, and will doubtless continue to be in a second term, stubbornly wrong-headed. But I give him credit for this. If Rmoney takes the presidency (word "takes" used advisedly), and we come out of this election paying still more for the luxuries of the über-wealthy, I'll be mad as hell.

(The house demolition behind Our House is really taxing my patience; now I must take a tax break. <grin_duck_run />)