Re: Elections 2012 -- Carrion My Wayward Son!
It isn't easy being the intellectual frontmen for President Obama's re-election campaign, as the boys at the Brookings-Urban Institute Tax Policy Center are discovering. Their ballyhooed study of Mitt Romney's tax plan looks worse with each new examination.
Mr. Romney's tax plan would cut income tax rates across the board by 20%, while cutting loopholes that mostly benefit those in the highest income classes. The Tax Policy Center claims it is "mathematically impossible" to finance the rate cut without jacking up taxes by $86 billion on the middle class and poor. Mr. Obama has jumped on the study to support his claims that Mr. Romney would raise taxes, though the Republican has proposed no such thing. (See "The Romney Hood Fairy Tale," August 8.)
http://online.wsj.com/article/SB100...7581570978359112.html?mod=WSJ_Opinion_LEADTop
Must be fun to just make stuff up.
I guess that's why some of us can't have a reasonable conversation. The Brookings-Urban Institute Tax Policy Center has also said that it is "mathematically impossible" to reduce income tax rates and increase government tax revenues, yet the 1961 Kennedy tax cut did just that....as did the 1986 Reagan - Rostenkowski tax cut.....
So something that has actually happened three times, based on data provided by the IRS (yeah, who'd ever believe anything that rabid partisan Republican entity would say, right?), is nevertheless called "mathematically impossible."
For years, aerospace engineers had claimed that it was impossible for bumblebees to fly. Then, using high-speed photography, they learned that when the bumblebee flaps its wings,
they change their shape and it is this change in shape that allows them to fly after all.
Similar with changes in tax rates that also restrict deductions: it is cheaper to pay the tax than to hire accountants and chase after deductions that have no economic purpose other than to reduce taxes. Lower rate / fewer deductions allow people to make spending and investment decisions based purely on their underlying economics, which means more productive spending and investment decisions, which means more economic growth.
"Bumblebees can't fly" : high tax rates + lots of deductions :: bumblebees
do fly : lower tax rates + fewer deductions
For me personally, I'd gladly give up the mortgage interest deduction and pay income tax on health insurance premiums above a threshhold in return for lower rates. For me politically, the only deductions I'd like to see maintained are charitable deductions (they serve the same social function as many income taxes yet deliver better value for the money) and income-tax free life insurance proceeds (if a person has provided for his family already, why tax that money under the guise of helping the family??? "you don't take food out of the mouths of widows and orphans")