Skip to main content

Republican presidential nominee Mitt Romney speaks during the first presidential debate with President Barack Obama (not pictured) in Denver October 3, 2012.    REUTERS/Jim Bourg (UNITED STATES - Tags: POLITICS ELECTIONS USA PRESIDENTIAL ELECTION)
Mitt Romney yesterday on CNN, taking another crack at explaining how his tax plan would work:
How we carry them out would be lowering the rate, the tax rate, across the board and then making up for that both with additional growth and with putting a—a limit on deductions and—and exemptions, particularly for people at the high end.
So according to to Mitt Romney, his tax plan has three main features:
  • First, cut everybody's taxes by lowering rates "across the board." (He's previously said the rate cut would be 20 percent.)
  • Second, partially offset the costs of that tax cut by limiting deductions and exemptions, "particularly for people at the high end" of the income scale. (Later in the interview he suggested accomplishing this with a cap of between $25,000 and $50,000 on such deductions.)
  • Third, pay for the rest of his tax cut with economic growth.

That third point is essential, and it goes to the heart of the problem with Romney's tax plan, because with that third point Mitt Romney is explicitly conceding that his tax plan math doesn't add up without the magical math of tax cuts that pay for themselves.

Mitt Romney says that under his plan, the wealthy will pay the same amount of taxes as they do now, but by the logic of his own proposal, that could only be the case if cutting taxes on the wealthy leads to an economic boom. Without an economic boom, the tax cuts won't pay for themselves. Instead, the wealthy will walk away with a a 20 percent tax cut, but the middle class will be left holding the bag in the form of even bigger deficits and draconian budget cuts.

It would be one thing if there were any precedent showing that Romney's plan would work, but there isn't. In fact, what Romney is proposing is exactly the same thing as Bush proposed in 2000—and we wall know what happened when we tested his theory. If there's any major difference between the two plans it's that Romney's plan would add new tax cuts on top of the old, Bush tax cuts—so it would be an even bigger mistake.

Romney tries to sidestep the reality of his tax plan math by pushing the notion that all he's trying to do is reduce taxes on small business job creators. Here's what Romney said during last week's debate:

And you'd think, well, then why lower the rates? And the reason is because small business pays that individual rate; 54 percent of America's workers work in businesses that are taxed not at the corporate tax rate, but at the individual tax rate. And if we lower that rate, they will be able to hire more people. For me, this is about jobs. This is about getting jobs for the American people.
Sound familiar? Compare it to what Bush said in 2004:
Do you realize, 900,000 small businesses will be taxed under his plan because most small businesses are Subchapter S corps or limited partnerships, and they pay tax at the individual income tax level. And so when you're running up the taxes like that, you're taxing job creators, and that's not how you keep jobs here.
So, yes, Romney sounds just like Bush. And yes, Romney's plan is rooted in magical tax plan math, just like Bush's plan. And it would be just as big a disaster—if not even worse.

Meanwhile, President Obama is proposing the same thing that President Clinton signed into law in 1993: modest increases on top taxpayers so that we can reduce the deficit and pay for the kinds of investments we need to support long-term economic growth. Unlike the Romney-Bush plan, Obama-Clinton plan will work. It worked then, and it'll work now.

Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags


More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

  •  The important part is those deductions! (15+ / 0-)

    This a political problem for Obama.  It sounds like he's increasing taxes on the rich, just like Obama.  The campaign had better have a really good response to this by tomorrow night.

    •  As Rachel Maddow pointed out on her show, (19+ / 0-)

      the Romney 5 point plan looks suspiciously like the Bush 5 point plan.

      Which also looks like the Reagan 5 point plan.


    •  Yes, Willard needs to be asked if his "plan" (16+ / 0-)

      still includes eliminating the cap gains tax and inheritance tax.  

      Willard also needs to be asked if his "plan" eliminates the exemption for MUNI BOND INTEREST and interest built up on the cash value of insurance policies.

      Willard's campaign went back to the TPC specifically for them to include the muni and insurance interest items.

      DAMN IT, why in the hell can't one decent interviewer follow up with these types of questions.  Shit, it isn't really that hard.

      This rat gets away with so much shit.

      •  Eliminating capital gains? Really? (15+ / 0-)

        I didn't hear that.  If that's true, that's how the scumbag let's the rich out of his deduction box.  Almost all of Mitt's income was from capital gains, as is most income for the rich.

        You are absolutely right that we need 1 good journalist to pin him down on this, or Biden better hammer Ryan on this tomorrow night and not let up.

        •  The job, at least initially, goes to Biden, (10+ / 0-)

          because eliminating the cap gains tax, as well as the estate tax, are major points in Ryan's plan, which Romney endorses and which would pass a Republican House in a heartbeat.

          Nobody in the MSM, at least on TV - with the exception of Ezra Klein - knows enough about these plans to ask questions and not let R&R double-talk the answers.

          "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

          by SueDe on Wed Oct 10, 2012 at 09:02:08 AM PDT

          [ Parent ]

          •  There is a fallacy there I've not heard discussed (1+ / 0-)
            Recommended by:

            The ideas that Romney and other conservatives push for treating cap  gains differently is that they have already been taxed at the corporate level. Notwithstanding whether one takes the idea of corporate taxation seriously given how so many big companies pay little tax, there is no one-to-one correspondence between corporate income and capital gains.

            Sure, dividends reflect profits that would be subject tot eh tax system, much capital gain ail come from increased investment value that has much more to do with a trading market that is not neatly correlated with corporate revenues. Certainly, gains in the price of stock held by a shareholder are never taxed at the corporate level, even if they may or may not bear some relationship to movement in corporate revenues.

            Then you throw in the idea that any gain in would lead to stepped-up basis at death, if you eliminate the estate tax, it will never be taxed at ANY level.

            Coming Soon -- to an Internet connection near you:

            by FischFry on Wed Oct 10, 2012 at 10:23:21 AM PDT

            [ Parent ]

            •  Romney lied (surprise!) about cap gains. (1+ / 0-)
              Recommended by:

              Unlike dividends they are not taxed at the corporate level - which is why Romney takes his capital gains outside the country where they're not taxed at all.

              For a really good discussion of Romney's economic plan - if you can call it that (it's more a scam than plan) - read William Gale's explication here.  This is a follow-up to the work Gale's group did on Romney's plan when he first released it, before he started redefining, backtracking and dissembling about it.  Gale is Co-Director of the Tax Policy Center at Brookings.

              "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

              by SueDe on Wed Oct 10, 2012 at 12:48:00 PM PDT

              [ Parent ]

            •  Sounds like you're confusing divideds w/cap (0+ / 0-)

              gains.  Not the same thing.  Dividends are paid out of earnings, which have already been taxed.  Capital gains are new earnings, they have never been taxed.

              Say you buy Google for $500 and it rises to $700.  If you bought 100 shares, you have just made $20,000 in capital gains.  You are not taxed on the $50,000 you invested because you already paid taxes on it when you earned it.  You are only taxed on the $20,000.  That money was never taxed before.

              The other issue about Mitt and capital gains is that Bain was calling management fees "carried interest."  Carried interest, something available to these partnerships, is taxed at the cap gain rate.  But management fees are earned income and should be taxed at the higher rate.

              Again.  CAPITAL GAINS have NEVER been taxed before.

              In capitalist America, bank robs you!

              by madhaus on Wed Oct 10, 2012 at 09:05:27 PM PDT

              [ Parent ]

        •  Romney proposes no cap gains taxes for sub $200k (1+ / 0-)
          Recommended by:

          households as well as for dividends and interest.


          Cap gains, dividends and interest do not get the 20% rate cut under the Romney proposal.  A wealthy person with only cap gains, dividend and interest income would not see a benefit from the rate cut except potentially for the first $200k of income.

          In the particular case of Romney, his taxes would go up significantly under his proposal because of the loss of deductions, and his income coming from sources that don't get the rate cut.

          The most important way to protect the environment is not to have more than one child.

          by nextstep on Wed Oct 10, 2012 at 09:20:28 AM PDT

          [ Parent ]

          •  If his rate doesn't change then how can (0+ / 0-)

            his taxes go up? Romney's earned income rate, albeit a small part of his total income, will go down by 20% and the loss of deductions will render it defecit neutral according to Romney's campaign. Where is the increase in taxes?

            •  As stated in my comment (0+ / 0-)
              his taxes would go up significantly under his proposal because of the loss of deductions,
              In addition to state income taxes and property taxes, he also had very large charity deductions.  Deductions reduce taxes due not only on ordinary income.

              The most important way to protect the environment is not to have more than one child.

              by nextstep on Wed Oct 10, 2012 at 10:58:13 AM PDT

              [ Parent ]

              •  Yes, I understand that removing those deductions (0+ / 0-)

                would raise his burden but he also would reduce his rate by 20%, offsetting any increases by his own assertion. He has stressed over and over how his plan would be defecit neutral with no increase in revenue. If his defecit exploding plan is going to be magically balanced with the closing of loopholes and LOWERING the tax rate across the board it's odd that he hasn't said exactly what loopholes will close...rendering any calculations about how it would affect his rate wildly speculative. His plan relies heavily on an unrealistic expectation of growth to make up the difference in lost revenue. It does conveniently protect the wealthy if there is another Republican Economic crash by giving them nice low rates and another excuse to bring down the austerity hammer on the lower classes. As far as raising his tax onus significantly, I seriously doubt that and repeating what you already posted hardly proves it.

                •  The Romney tax proposal does not reduce rates (1+ / 0-)
                  Recommended by:

                  on capital gains, dividends or interest for income over $200k. So the average reduction in marginal rates paid by Romney would be far less than a 20% reduction.  

                  At this point, it looks like all the various current itemized deductions will be retained, but a fixed dollar cap on total deductions would apply.  Based upon what has been said and written, this cap amount would be somewhere between $17k and 45k.  The idea of a total cap is very powerful, as it puts very strong limits on gaming the tax code by the wealthy. The current tax code already has weaker forms of deduction caps thought the AMT and limits on charitable deductions.  

                  As far as being revenue neutral, it depends upon to what extent the base is broadened in a Congressional deal and how high is the deduction cap.  The base could be broadened further by excluding the foreign tax credit, including municipal bond interest in income, treating carried interest as ordinary income, etc..limitation on deferred income, etc..

                  The most important way to protect the environment is not to have more than one child.

                  by nextstep on Wed Oct 10, 2012 at 06:43:54 PM PDT

                  [ Parent ]

          •  HE HAS PROPOSED MANY, MANY THINGS (1+ / 0-)
            Recommended by:

            ...he doesn't exactly inspire confidence that he would put full weight behind any of his stated plans in their known forms, should he be elected.

      •  Let's Eliminate the Capital Gains Tax (16+ / 0-)

        In fact, let's eliminate the distinction between capital gains and ordinary income from the tax code altogether.

      •  What does 20% reduction mean? (2+ / 0-)
        Recommended by:
        shoeless, One Opinion

        Does it mean a reduction of 20% in the tax rate, so the 25% bracket goes to 20% and the 35% bracket goes to 28% and the 10% bracket goes to 8%?  I hope it doesn't mean he shaves 20% off the top bracket.

        Mitt has said in the past he wants to eliminate taxes on dividends and capital gains, on the bogus theory  that it is "double taxation" because corporate profits are taxed.  Of course we pay income taxes and then sales taxes when we spend the same money we paid taxes on, but there are always different rules for the peasants.  He also wants to eliminate the estate tax, allowing his kids to inherit his vast estate tax free.

        Romney should be asked specifically if he would really eliminate all the tax avoidance strategies that have made him a very wealthy man.  If so, then he should be asked why it was good enough for him when he was amassing his fortune but should be outlawed for everyone else now.

        The scientific uncertainty doesn't mean that climate change isn't actually happening.

        by Mimikatz on Wed Oct 10, 2012 at 08:57:04 AM PDT

        [ Parent ]

        •  what answer would you like? (4+ / 0-)

          That's the one Mitt will give. Of course, he'll give another answer to another audience if that's what they prefer.

          It's obvious to me that not only hasn't Mitt done the math on any of these ideas, but he hasn't thought through any of it either. He's just throwing shit up against the wall to see if any of it sticks.

        •  It won't be understood by Joe Voter. (0+ / 0-)

          And it steers the national conversation back to taxes....and the lack of released tax returns. Bad freakin' move for Mitt!

          Mittiple Choice - 2012

          by kitebro on Wed Oct 10, 2012 at 11:19:11 AM PDT

          [ Parent ]

        •  He said capital gains are double taxed? LIAR. (0+ / 0-)

          Dividends are double taxed.  Capital gains are not.
          As I explained above, if you invest $5000 in something and earn $2000 on it, you are not taxed on $7000 but instead on the $2000 profit.  That $2000 was never taxed before.  NEVER.


          In capitalist America, bank robs you!

          by madhaus on Wed Oct 10, 2012 at 09:09:11 PM PDT

          [ Parent ]

    •  Ending Mortgage deductions. (1+ / 0-)
      Recommended by:

      Not a popular plan. Nor a problem for Obama.

      Mittiple Choice - 2012

      by kitebro on Wed Oct 10, 2012 at 08:56:12 AM PDT

      [ Parent ]

      •  for the rich only (1+ / 0-)
        Recommended by:

        big problem for Obama.  If he limits deductions to $25K, it won't effect most people in the country.  The middle class will still have their mortgage deduction.  He's disarming Obama's attack on eliminating those deductions.

        •  Not big problem for Obama, at all: (3+ / 0-)
          Recommended by:
          pollwatcher, Steve Magruder, JerryNA

          One answer has already been given - If this and other popular deductions are eliminated only for the rich, it will in no way cover the  20% tax cut that Romney wants to give.  And if he reduces the size of the tax cut to ensure revenue neutrality, then he is abandoning his central trickly plan for destroying creating jobs.

          The real answer of course, is that Congress will be pass the "non-controversial part that everyone agrees with", the tax cuts, first.  Do you honestly believe that they are going to eliminate the home mortgage deduction, charitable deductions, and medical insurance deductions for those making over $250 k?  The lobbyists will have a field day, regarding the destruction of the housing industry, impoverishment of charities, and the incentive for businesses to drop health insurance coverage for their more well to do employees. It is bait and switch, and'll never happen in a million years.

          "The only thing we have to fear - is fear itself." - Franklin Delano Roosevelt

          by orrg1 on Wed Oct 10, 2012 at 09:21:34 AM PDT

          [ Parent ]

          •  It adds up perfectly fine. (2+ / 0-)
            Recommended by:
            Steve Magruder, JerryNA

            Not really, but that will be Romney's response.  He'll just deny that it doesn't add up, just like he told so many lies in the first debate.

            Your answer is perfectly accurate, but I hope Obama/Biden can come up with a 1 or 2 sentence explanation that will convince an uninformed public that it doesn't add up.

        •  Taxes is not a topic (2+ / 0-)
          Recommended by:
          pollwatcher, JerryNA

          that Romney should have brought up. But he did. And he will now be lambasted for it. For instance, will he enact laws stopping wealthy people from hiding their money in off-shore banks?

          Mittiple Choice - 2012

          by kitebro on Wed Oct 10, 2012 at 09:40:33 AM PDT

          [ Parent ]

    •  the point has been made (6+ / 0-)

      that even if every loophole/deduction was eliminated, so zero dollars instead of $17,000  or $50,000 as a cap,  the rich still get a massive tax cut.  Add in the cuts on capital gains, where most truly rich people's money comes from, and the estate tax elimination so there children get even richer, and you still have an upward transfer of wealth.

      Add in all the promised wars, and you get Bush on Steroids, a ballooning deficit, upward wealth transfer at a faster rate and massive cuts to the domestic spending and mandatory programs.

      So the answer is simple,  Romney's tax plan is bad because economic growth has to be ginormous.  Didn't Meteor Blades diary about so professor doing the numbers, and that the average salary of Mitt's 12 million new jobs had to be $433,000 a year to make up the revenue loss?

      The tax plan is a joke.   And no it is not a political problem for Obama because you can give the benefit of every doubt to Romney, and the math still doesn't work.  Yes, the President needs to be able to address it, Biden should be able to address it,  but it is not a 'problem'.

      •  Also Obama actually managed to point out (3+ / 0-)
        Recommended by:
        Steve Magruder, jfromga, JerryNA

        that closing every loophole that exists in the current tax code would not make it possible to offset the 20% cut. Of course, this statement was not made as an immediate retort to this silly business, it was an afterthought a few moments later.
        Still, it was a good afterthought.

    •  Obama needs to stress some basic facts. (4+ / 0-)

      Most people don't even know recent history.  Obama and Biden need to state that Bush's tax cuts didn't pay for themselves with economic growth--they exploded the deficit.

      But even without that magical thinking, Romney's plan should scare the hell out of people.  When you cut away the sales pitch he's saying he will pay for massive across the board tax cuts with targeted tax hikes.  So for anyone to come out with an actual tax decrease, someone has to come out with an increase.  He's already claimed (dubiously) that the rich are going to break even--so who gets left holding the bag?  And who's getting fucked when he goes to implement this and his party reminds him that the "job creators" are the only rightful target for tax relief?  

      Obama should ask Romney to pledge not to target the Earned Income Tax Credit.  Even if Romney takes it off the table, it would remind people that these targeted tax hikes Romney wants are not so abstract.

    •  TPM took it apart already (3+ / 0-)
      Recommended by:
      pollwatcher, Steve Magruder, JerryNA

      And I'd also like to point out that the "five studies" Mitt claims support his tax plan even assuming an economic boom still need to take away virtually every deduction for the middle class in order to make the numbers work.

      •  Yeah, But The Low Information Sound Bite Voter (3+ / 0-)
        Recommended by:
        714day, pollwatcher, JerryNA

        doesn't read TPM. So, Obama needs to TELL people during the debates WHY Mitt's tax plan is just like Bush's and won't create any economic growth (just like Bush's tax cuts didn't), but will explode the deficit.

        •  Voodoo Economics redux (0+ / 0-)

          Nothing about Willard's proposal is new. This is the same failed Voodoo Economics the right has been pushing since Reagan. Only republicans can be stupid enough to think that decreasing revenues raises revenues. The only thing Voodoo Economics does is saddle this nation with huge deficits and greater disparity between the rich and the rest of us.

          --- Keep Christian mythology out of science class!

          by cybersaur on Wed Oct 10, 2012 at 12:42:31 PM PDT

          [ Parent ]

    •  If really offsets tax cuts with deduction cuts.. (2+ / 0-)
      Recommended by:
      714day, JerryNA

      If Romney really would offset the cuts with deduction caps or even eliminating other breaks -- especially for higher-income earners -- then it's a logical fallacy to claim that the tax cuts would put more money in the pockets of employers.

      In which case, there won't be the economic growth -- even if you accepted the dubious proposition that a tax cut, by itself will generate much economic growth.

      Coming Soon -- to an Internet connection near you:

      by FischFry on Wed Oct 10, 2012 at 09:56:45 AM PDT

      [ Parent ]

      •  Obama actually mentioned this, (1+ / 0-)
        Recommended by:

        though he was a bit tardy with the statement and it seemed almost as if it was a throwaway line.

        •  I think Obama made a different point (0+ / 0-)

          He kept going back to the study that said if the rich were going to get real tax cuts and the policy (I can't call it a plan) would remain revenue neutral, then middle class folks would be forced to pay about $2000 a head.

          I didn't hear Obama refer to the idea that reforms which offset any tax cuts would remove any economic stimulus effect of the so-called tax cuts. If he did make the point, I missed it.

          Coming Soon -- to an Internet connection near you:

          by FischFry on Wed Oct 10, 2012 at 07:27:20 PM PDT

          [ Parent ]

  •  This man has no core. At least W believed in the (4+ / 0-)

    BS he spewed.

    "Rick Perry talks a lot and he's not very bright. And that's a combination I like in Republicans." --- James Carville

    by LaurenMonica on Wed Oct 10, 2012 at 08:35:59 AM PDT

  •  I'm an S-Corp owner and I don't create any jobs (6+ / 0-)
    Recommended by:
    catfood, eXtina, JeffW, shoeless, jfromga, 714day

    I'm an independent consultant and I bill for my services. The revenue to my corporation that remains after expenses has to be reported to me as individual income. And that's fine with me.

    I believe an S-Corp is not a suitable arrangement for a company that has more than two employees-- i.e., an individual or a married couple.

    "The smartest man in the room is not always right." -Richard Holbrooke

    by Demi Moaned on Wed Oct 10, 2012 at 08:36:33 AM PDT

    •  S-Corp and "small business" are, according to (6+ / 0-)

      Republicans in general and Romney in particular, interchangeable.
      Here's an excerpt from a previous diary right here at DKOS, listing some entities that file as S-Corp.

      According to MSNBC, the list of corporations considered small businesses are as follows:

      Koch Industries, a conglomerate of partnerships with 70,000 employees.
      Enterprise Products Partners, L.P., a pipeline company with 2009 revenues of $25 billion.
       Kohlberg Kravis Roberts & Co., a Wall Street firm with $445 million in revenue in 2009.
       Price Waterhouse Coopers, an accounting firm with $26 billion in revenue in 2009.
       The Hillman Company, an investment founded by billionaire philanthropist/industrialist Henry Hillman.
       Venn Strategies, Inc., whose chief operating officer is Brian Reardon, a former special assistant to former President George W. Bush.
       Ferrellgas, a propane and propane accessories business, with $2 billion in revenues in 2009 and 1 million customers.
       CoorsTek, a ceramics manufacturer founded by Adolph Coors, with 2009 revenue of $549 million.
       Dead River Co., with $500 million in revenue and 1,200 employees.
       McIlhenney Co., the Tabasco maker, with $250 million in revenue in 2007.
       Bechtel, the largest construction conglomerate on earth.
       The Chicago Tribune, which also owns the LA Times, the largest newspaper in America.

      There are also individuals who file as S-Corps. These include Barack Obama, Mrs. John McCain, and Kieth Olbermann himself, which he admitted on air
      Now you know what republicans are talking about the next time they use the term “Small Businesses.”

      It really means “Huge Businesses run by our buddies and people who give us money, as well as a few other slobs who manage to fit themselves in the same loophole.

      The diary is  Here.

      When Republicans talk about small business, S-Corp is what they really mean. Do you consider yourself to be in the same catagory as Koch Industries?

      Everybody got to elevate from the norm....

      by Icicle68 on Wed Oct 10, 2012 at 08:57:34 AM PDT

      [ Parent ]

    •  Why? (3+ / 0-)
      Recommended by:
      Demi Moaned, 714day, JerryNA

      S corporations, and more recently LLCs taxed as partnerships, are overwhelmingly the preferred entities for doing business, unless there is a compelling reason to be a C corporation.  Generally, the only such compelling reason is because of a desire to go public in the near future.

      "Well, I'm sure I'd feel much worse if I weren't under such heavy sedation..."--David St. Hubbins

      by Old Left Good Left on Wed Oct 10, 2012 at 09:24:50 AM PDT

      [ Parent ]

      •  For one thing, you can't leave money in it (0+ / 0-)

        All profits are disbursed to the owner at year end.

        I don't know a lot about it, but when I incorporated back in '08 I was told that S-Corp was only advantageous if you had almost no employees.

        "The smartest man in the room is not always right." -Richard Holbrooke

        by Demi Moaned on Wed Oct 10, 2012 at 10:15:16 AM PDT

        [ Parent ]

        •  S corps (0+ / 0-)

          The net income is taxed to the owners, but there is no requirement that the "profits" be distributed to the owners.

          In a C corp, the net income is taxed to the corporation and then taxed again when distributed to the owners, which is not tax efficient at all.  It is common in closely held C corps to pay any net income out to the owners as bonuses (which are deductible), which results in tax treatment similar to that of an S corporation.

          You either received laughably bad advice or misunderstood it.

          "Well, I'm sure I'd feel much worse if I weren't under such heavy sedation..."--David St. Hubbins

          by Old Left Good Left on Wed Oct 10, 2012 at 11:07:45 AM PDT

          [ Parent ]

          •  I don't have any profits (0+ / 0-)

            I only have income, so it's immaterial in my case. I didn't spend a lot of time studying the differences and I choose an S-Corp because it seemed like it would be the simplest to establish and operate.

            "The smartest man in the room is not always right." -Richard Holbrooke

            by Demi Moaned on Wed Oct 10, 2012 at 11:37:25 AM PDT

            [ Parent ]

            •  I am partner in an S Corp (1+ / 0-)
              Recommended by:
              Demi Moaned

              Number of employees in immaterial.  The issue is number of partners.  When it was set up, the C Corp tax rate was higher than the individual tax rate, that's why we used an S Corp.  Employees do not affect S Corp earnings differently than C Corps.

              Also Old Left Good Left is correct that S Corps do not have to pay out all earnings.  The downside of S Corps is whether or not the earnings are paid out, partners are taxed on their share of the earnings.  It's fairly typical that I am hit with X earnings to pay individual taxes on, but only get X/2 in dividends.  I am not taxed on X/2 but on X.

              In capitalist America, bank robs you!

              by madhaus on Wed Oct 10, 2012 at 09:15:38 PM PDT

              [ Parent ]

              •  Well that's clear and I kind of knew that (0+ / 0-)

                ... i.e., I knew that the earnings did not have to actually be disbursed but that you were taxed on them as income nonetheless. From that point of view I didn't see the point of ever leaving the money in the corporation. But based on your explanation I see that there might be more to it than that.

                "The smartest man in the room is not always right." -Richard Holbrooke

                by Demi Moaned on Thu Oct 11, 2012 at 04:05:54 AM PDT

                [ Parent ]

  •  Decades of economic data.... (15+ / 0-)

    ....and yet, like science, some choose to ignore it.

    Aldus Shrugged : The Antidote to Ayn Rand. ***Buy ALDUS SHRUGGED on amazon, and ALL royalties will be donated directly to Democrats in contentious Downballot races. @floydbluealdus1

    by Floyd Blue on Wed Oct 10, 2012 at 08:36:33 AM PDT

  •  "Fooled me once, shame on him-- (8+ / 0-)

    don't get fooled again!"

    'You give me a water board, Dick Cheney and one hour, and I'll have him confess to the Sharon Tate murders.' -Jesse Ventura

    by NepentheRising on Wed Oct 10, 2012 at 08:37:57 AM PDT

  •  I'm astounded. (11+ / 0-)

    He actually put something on the table and committed.  I am glad that he did, I want Obama to beat him over the head with it in the next debate.

    Three more to go people.

    Ignorance more frequently begets confidence then knowledge. Charles Darwin

    by martianexpatriate on Wed Oct 10, 2012 at 08:39:32 AM PDT

  •  I'd like to point out some stuff about this Clin.. (1+ / 0-)
    Recommended by:

    Clinton mythologizing.

    The two best things that Clinton did during the 90's was keeping a lid on global conflicts by understanding the world economy can't grow if the world is at war; also, at the margins, he and his team did some small things to pump aggregate demand which is good.

    But the biggest reason why we had a boom in the 90's was because of the internet, technology, and computers. It was the gift of science to our economy; as long as whoever was president didn't screw things up by starting a war we were always going to have that boom whether we passed that 1993 bill or not. Facts!

    Also, if I wanted to be a jerk I'd point out that Gless-Stengall bill that he signed was tied in the top 3 for the biggest single cause of the financial crash and housing catastrophe that we are dealing with now. But I am certain Bush would have signed it in 2001 if Clinton did it, making it a moot point.

    •  Facts includes (2+ / 0-)
      Recommended by:
      Steve Magruder, JerryNA

      not only creating millionaires but pulling people up out of poverty.  

      Not starting a war is a pretty good legacy, I'd say.  

      Creating a surplus, pretty good stuff.  

      No one is saying Clinton is perfect.  But his policies worked.

      And think about it - if the economy wasn't in free-fall when Obama came along, and he put the money he has into the green economy, we could have a similar boom to the one created by computer tech under Clinton.

      Perhaps in his second term with the economy more stabilized, the steps he's already taken will bear fruit - there will be tons of jobs in that sector and people are preparing for it now, and the R&D is being supported now.  Grants are being offered to college students to innovate as well.

      I wouldn't cry if the green economy was the "only" reason for a ton of new jobs.

      Why is it that a 3% tax increase for the wealthy is considered "socialism" and an 8% wage cut for the middle class is "doing your part"? MartyM

      by delphine on Wed Oct 10, 2012 at 09:15:51 AM PDT

      [ Parent ]

    •  I Would Add To That Clinton Legacy - Passing NAFTA (3+ / 0-)

      a trade agreement which has generally HURT our economy and led to job losses here. But I did vote for Clinton (and would again) - he was a hell of a lot better than W.  and his pre-emptive unpaid for wars and tax cuts.

  •  growth assumption increases cost (1+ / 0-)
    Recommended by:

    if Mitt's plan is based in part on growth, the cost of it is well above $5 trillion.

  •  If the Bush tax-cut projections had come true... (5+ / 0-)
    Recommended by:
    JeffW, here4tehbeer, jfromga, elmo, JerryNA

    ... the economy would be about 30% larger today than it actually is.

    Remember "dynamic scoring"?

    I'm going from memory here on the 30% - because Heritage (whose staff apparently did the modeling) scrubbed their write-up of this bullshit from their website (probably an accident, right?), but I would think some economist somewhere would still have a copy.  

    It would be nice to reproduce those exhibits used to justify the Bush tax cuts in some prominent forums to call out just how totally absurd Bush-Romney economics has always been - relying completely on obvious "big lies."

    Toto, I've a feeling we're not in Kansas anymore

    by Minerva on Wed Oct 10, 2012 at 08:39:52 AM PDT

    •  See if this PDF gets you close: (0+ / 0-)

      It's from the Heritage folks themselves:




      CDA01-01     Rev April 27, 2001

      Here's the link.  Freedom Ponies not included.

      Frak John Galt... "Who Is Mitt Romney?"

      by here4tehbeer on Wed Oct 10, 2012 at 08:57:53 AM PDT

      [ Parent ]

  •  Sorry, Jed (9+ / 0-)

    you start your post with:

    Mitt Romney yesterday on CNN,
    I never thought you were lax in your research, but, between yesterday and right now at 11:30 a.m. EDT, many, many, many different Romney tax plans could have been asserted.

    Get your 12 assistants on any update, please.

    " My faith in the Constitution is whole; it is complete; it is total." Barbara Jordan, 1974

    by gchaucer2 on Wed Oct 10, 2012 at 08:40:31 AM PDT

  •  Reducing tax rates AND eliminating (4+ / 0-)

    deductions for pass-through entities doesn't reduce their tax burden.

    Indeed it is the deductions, credits and exemptions that are the "mystery" behind Willard's "plan"

  •  #3 is the same old BS that.... (5+ / 0-)

    ....lower rates produces more revenue.

    There is nothing anywhere to prove that.

  •  And on Nov. 8... (13+ / 0-)

    If this ship of fools regains the White House, the messaging would suddenly change to this:

    Deficits don't matter.

    The Republican brand: "Consequences, schmonsequences, as long as I'm rich"

    by D in Northern Virginia on Wed Oct 10, 2012 at 08:42:34 AM PDT

  •  They need to hang a BUSH-CHENEY sign around their (10+ / 0-)

    necks in the final three debates.

    You're so-called plan isn't anything new: tax cuts that disproportionately favor the wealthy, which you say magically won't add to our debt. Out-of-control military spending that the Pentagon and our people don't want and didn't ask for.

    •  Obama/Biden really do need to compare him to (5+ / 0-)
      Recommended by:
      JeffW, tb mare, JerryNA, cybersaur, madhaus

      Bush. This is so important to remind voters that his domestic and foreign policy is identical to Bush's and maybe even more extreme.  I think they would score big points in a debate just saying that even if Mitt protests.

      I think just landing some punches even if Mitt protests and denies is important at this point.

      Follow PA Keystone Liberals on Twitter: @KeystoneLibs

      by wishingwell on Wed Oct 10, 2012 at 08:49:24 AM PDT

      [ Parent ]

      •  Someone should point ot too Mitt... (0+ / 0-)

         That the refusal to give real numbers on his tax plan is cowardly. Mitt will protest that he's not a coward, of course and the reply to that should be, "Why not be brave , Mitt and produce 12 years of tax returns like your dad. What are you hiding?"

        "Let Mitt Romney go bankrupt!"

        by PlinytheWelder on Wed Oct 10, 2012 at 10:27:36 AM PDT

        [ Parent ]

  •  It's very clear that Democrats are better at (9+ / 0-)

    - Managing the Economy
    - Reducing the Deficit
    - National Defense

    Why Republicans get the automatic nod on any of these issues is mystifying.

    “No, Mitt, corporations are not people. People have hearts, they have kids, they get jobs, they get sick, they love, they cry, they dance, they live and they die. Learn the difference.”-- Elizabeth Warren

    by Positronicus on Wed Oct 10, 2012 at 08:44:32 AM PDT

    •  Stop it, Silly Dilly (6+ / 0-)

      Didn't you watch the debate the other night? I mean, Mitt Romney smiled more than Obama. And Obama looked down at the podium a few times.

      And those things are far more important than the economy, national security, jobs, health care, education, Social Security or the environment.

      CNN told me so!

      In 2016, I think we should just go all the way. Each candidate gets three minutes on stage with Ryan Seacrest, and then the American people get to text in their vote and decide who wins the White House. Not much of a stretch from what we're already doing.

      Your facts and logic have no place in 21st-century politics.

      They've done studies, you know. 60% of the time, it works every time. -- Brian Fantana

      by IndyScott on Wed Oct 10, 2012 at 08:52:49 AM PDT

      [ Parent ]

      •  I think we should put the candidates (1+ / 0-)
        Recommended by:

        on Dancing with the Stars.  Watching Obama dancing next to Mitt's doing the White Man's shuffle would be a hoot!

        "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

        by SueDe on Wed Oct 10, 2012 at 09:20:16 AM PDT

        [ Parent ]

  •  Where are his magical tax returns? (6+ / 0-)

    Why has that discussion vanished? A $100 million IRA?

    I dreamed I saw Joe Hill last night, alive as you and me.

    by plankbob on Wed Oct 10, 2012 at 08:45:03 AM PDT

    •  I'm not surprised his tax returns (2+ / 0-)
      Recommended by:
      Steve Magruder, JerryNA

      are no longer addressed.  Every day there are a flood of  dissemblings, distortions and outright lies that have to be addressed or Romney "wins the day (and polls).   Regular folks can keep track of only so much, and the MSM doesn't give a damn about holding the Republicans accountable; they consider their job to be keep the horse race going.

      Romney is not going to tell us anymore than he wants to about anything, and if forced to discuss something he doesn't want to he just sidesteps or double-talks the issue.  More questions have gone down the rabbit hole during this campaign season than any other election I can remember.

      "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

      by SueDe on Wed Oct 10, 2012 at 09:30:03 AM PDT

      [ Parent ]

  •  Even Greenspan says to let ALL Bush taxcuts expire (3+ / 0-)
    Recommended by:
    jfromga, Steve Magruder, JerryNA

    It's unreasonable to expect significant growth in this decade and there are no good growth predictions but instead dismal outlooks for of no better economic pace than long-hard-slog.

    Romney's premise is not reasonable.

    Worse, Romney proffers the same warmongering as Bush and Cheney who matched the complacency of tax cuts and politicization of federal departments with unbudgeted wars to construct a deficit despite abundance and create a financial crisis in this rich nation.  

    Romney is for the birds! Loons.

    Let all Bush tax cuts expire and , bring on the Sequestration cuts to defense.

    by kck on Wed Oct 10, 2012 at 08:47:12 AM PDT

  •  Thanks Daily Show (7+ / 0-)

    for the questions that need to be asked to Mitt Romney regarding his magical tax (un)policy:

    Are you a wizard? Do you know or have you ever captured a leprechaun? Is there a goose in your house whose eggs, when said goose produces them, are gigantic and un-liftably heavy?

  •  Romney is not an innovator. (3+ / 0-)
    Recommended by:
    eXtina, JeffW, jfromga

    Lacking authenticity, the only thing Mittens can do is steal.  However, his lack of foresight led him to take from the utter worst that the GOP has to offer.

    "Those who would give up essential liberty to purchase a little temporary safety, deserve neither liberty nor safety." --Benjamin Franklin

    by politicalceci on Wed Oct 10, 2012 at 08:48:07 AM PDT

  •  two key words for the remainder of this campaign (5+ / 0-)
    Recommended by:
    OldDragon, JeffW, tb mare, JerryNA, madhaus

    1.  SPECIFICS - What specific deductions and exemptions would Romney get rid of in order to make up for a 20% tax cut for the wealthy?
    2.  ARITHMETIC - It doesn't add up!  Mr. Romney, can you give us an example of when in history tax cuts have EVER "paid for themselves" with economic growth? (The answer is that is has never happened).

  •  Mitt's plan: (3+ / 0-)
    Recommended by:
    eXtina, IndyScott, JeffW

    1. Cut taxes
    2. ?????????
    3. Profit

  •  today he said he wouldn't touch the mortgage (5+ / 0-)

    deduction. So he's going to cut loopholes and deductions, except for those he won't touch.

    So, now instead of too little revenue, there's NO revenue

    "I'm sculpting now. Landscapes mostly." ~ Yogi Bear

    by eXtina on Wed Oct 10, 2012 at 08:49:28 AM PDT

  •  Would be a great ad (2+ / 0-)
    Recommended by:
    eXtina, tb mare

    to have a split screen with bush and rmoney saying those lines.

  •  All Obama has to do to undo the damage (2+ / 0-)
    Recommended by:
    eXtina, tb mare

    from his poor performance in the first debate and Romney's ability and willingness to lie without shame is simply appear presidential. I.e. commanding, confident, calm, authoritative, in control, but in a warm and engaged manner. I.e. kind of like Reagan, but without the crazy talk and imbicility. Whenever Romney lies, he need only say "That's not true Governor Romney and you know it". Whenever Romney attacks or mocks him, he need only say "Perhaps Governor Romney needs to switch to decaf or get more sleep". Otherwise, he need only articulate and promote his ideas in a confident and convincing manner and highlight his policy achievements despite record and reckless GOP obstructionism.

    "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

    by kovie on Wed Oct 10, 2012 at 08:49:56 AM PDT

    •  Decaf line won't work (2+ / 0-)
      Recommended by:
      tb mare, One Opinion

      Romney doesn't do caffine even tho he seems like he does.  PBO needs to engage women - talk specifically about what he'll do - no contraception co-pay, keep pushing for stronger equal pay laws, NOT cut the things that benefit parents (child tax and Earned Income credits) and not cut Medicaid, which keeps a lot of frail seniors in nursing homes and not in the extra bedroom because women are the caregiver most of the time.  (Apologies to all the men who are caregivers, not putting you down, just looking at the stats.)

    •  he also MUST bring up 47% (3+ / 0-)
      Recommended by:
      tb mare, Steve Magruder, JerryNA

      It goes to the very heart of the argument on taxes.

      Romney and republicans actually are in favor of raising taxes.  They actually do think that there are people who should pay more taxes.  Where they disagree with Obama and the Democrats is on who they think isn't paying enough taxes.  They want to raise taxes on the poor, the working class, and the middle class.  When they talk about 47% not paying Federal income tax, this is what they are complaining about.  They think think that "fairness" means taxing those people who can less afford to pay taxes even more.  Whereas Democrats think that what is fair is returning tax rates on the higher income levels to what it was during the boom years of the 90s, when we had explosive growth and balanced budgets.  What is fair is getting increased revenue from those who can afford to pay more taxes, those who don't need that money to pay for food, housing, clothing, education, and the other essentials.

  •  How to thwart a liar: pound his record. (6+ / 0-)

    Tax plan: look at Massachusetts.

    Flip-flopping: highlight this as Romney's key tactic

    And, last:  Romney as a Board Director (managerially involved financial, legal, business expert) of Devon Corporation was convicted of Medicare Fraud and fined over $100 Million--the largest conviction to date at the time.  

    As a Board Director one is held collectively accountable for all major business decisions by investors and the AG, but is spared personal financial depletion due to the corporate nature of the business.  In other words, investors had to pick up the tab for Medicare fraud that occurred under Romney's Directorship.  Further, Board Directors (ie, Member) help craft the business model, and are acutely aware of all business dealings--so Romney feigning ignorance is an outright lie.

    --hello Obama team?  

    From the Washington Post blog, no less:  

    ...Still, this time Winning Our Future gets closer to the mark. The case concerning Damon Clinical Laboratories is relevant because 1) Romney was a director of the firm while the fraud took place; 2) the fraud appears to have ended only after Bain sold its stake in the firm; 3) Romney personally earned nearly $500,000 from the sale of Damon; and 4) Romney’s statements about what he knew and when he knew it have been inconsistent.
         We’re going to hear a lot more about Damon if Romney becomes the GOP presidential nominee. The American Federation of State, County and Municipal Employees union is already running an ad in Florida that highlights the case. (The spot is at the end of the column.)....
    ...In 1996, the Justice Department announced that Damon had agreed to pay a $35.3 million criminal fine — one of the largest corporate fines in U.S. history — and an additional $83.7 million to settle whistle-blower lawsuits. The company, then owned by Corning, admitted that from 1988 to 1993 it had bolstered its earnings by submitting false claims to Medicare and other federal programs. Essentially, the firm billed for blood tests that doctors had not ordered. “This is a case, pure and simple, of corporate greed run amok,” U.S. Attorney Donald Stern said at the time. “The settlement represents about $3 for every $1 Damon stole from the taxpayers.”

    Republicans...What a nice club...of liars, cheaters, adulterers, exaggerators, hypocrites and ignoramuses. Der Spiegel -6.62, -6.92

    by CanyonWren on Wed Oct 10, 2012 at 08:50:55 AM PDT

  •  Magic math + magic plan = magic underware (1+ / 0-)
    Recommended by:

    And some magical spectacles to see it all

    I love George Takei for being aware and honest and sharing. And "the best damn pilot in the universe."

    by PHScott on Wed Oct 10, 2012 at 08:54:04 AM PDT

  •  He's dim, Jed! (1+ / 0-)
    Recommended by:
    D in Northern Virginia

    And so is anyone who votes for him.

    Float like a manhole cover, sting like a sash weight! Clean Coal Is A Clinker!

    by JeffW on Wed Oct 10, 2012 at 08:54:28 AM PDT

  •  I knew Mitt would screw this up (3+ / 0-)

    before the week was over!

    Mittiple Choice - 2012

    by kitebro on Wed Oct 10, 2012 at 08:54:46 AM PDT

  •  Tax rates and "job creation" (11+ / 0-)

    There's something else fundamentally wrong with the logic of cutting taxes for "job creation": the owner's income tax rate doesn't affect hiring.

    Look, I'm hiring a new engineer. Her loaded wage cost is, say, $120K/yr. But she's adding $180K/yr to my bottom line. Gross marginal profit, $60K/yr, right?

    If my marginal income tax rate is 50%, I'm keeping $30K/yr and it makes sense to hire. If my marginal income tax rate is 1%, I'm keeping $59.4K/yr and it still makes sense to hire. If my marginal income tax rate is 80%... it still makes sense to hire.

    Hiring and firing decisions are not affected by tax rates on net profit, nor by capital gains taxes. (They are, however, affected by payroll taxes.)

    This is really basic, fundamental, obvious economics.

    •  YES! (3+ / 0-)
      Recommended by:
      tb mare, dash888, catfood

      I was actually just scrolling through comments to see if anybody had made this point, because I was about to, but you made it perfectly.

      This really needs to be stressed.

    •  Your analysis does not fit the real world (0+ / 0-)

      It implicitly assumes no investment capital is required and there is no risk of a losing than investment.

      Why should an investor put money at risk unless compensated for the risk instead of just spending the money (while holding the unused cash in low risk assets that don't employ people)?

      Why risk losing $400,000 entirely in activity that employs people, only to get a low after tax rate of return if things turns out well, when one can have fun buying a $400,000 Ferarri?

      The most important way to protect the environment is not to have more than one child.

      by nextstep on Wed Oct 10, 2012 at 09:50:43 AM PDT

      [ Parent ]

      •  OK, you say let's look at the real world (1+ / 0-)
        Recommended by:

        so here we go...

        If the Bush tax cuts expire, the hiring manager would keep a little less of the money he made.  Really just a little less.  It shouldn't change the hiring scenario at all.

        •  Hiring Managers are different than investor/owner (0+ / 0-)

          Generally, hiring managers do not invest their money in the business, with the obvious exception of when the manager is also a significant owner.   If investors think the after tax returns on the business are low, they will seek to take cash out of the business, if the after tax returns are attractive and there are good investment opportunities they will put more in.  This will determine what the management will have for a capital  and operating budget - and ultimately hiring.

          Tax rates are an important factor in deciding whether to invest money into or take money out of a business, or invest in a new business or expand an existing business.

          The most important way to protect the environment is not to have more than one child.

          by nextstep on Wed Oct 10, 2012 at 11:16:32 AM PDT

          [ Parent ]

          •  Yes, but what's their alternative? (0+ / 0-)
            If investors think the after tax returns on the business are low, they will seek to take cash out of the business...
            True, but in the case of a general increase in the corporate income tax, or in the individual tax rates of the pass-through owners, what are they going to put the cash into? The stock market is doing really, really well overall. There's no particular reason to pull your money out unless you just feel like spending it on luxuries.

            So yes, I see your point about taxes driving the "invest vs. spend" decision. Still, there was plenty of investment going on even when marginal tax rates were much higher than they are now. Your logic holds, but it doesn't seem to affect real-world behavior that much.

            The main thing is that I wanted to shoot down the notion that taxes on profits would specifically deter companies from hiring or retaining employees. That doesn't make any sense at all.

            •  when marginal tax rates were much higher (0+ / 0-)

              there were many and easy ways to shelter income from taxes, so the effective tax rates were much lower than one would think from the high marginal rates.

              When the Federal tax rate cuts and deduction changes were made in the 1980s,  tax revenues went up each year, not down and the share of the tax burden paid by the wealthy increased.  

              When marginal tax rates were high right after World War II, US production had a major competitive advantage due to the massive destruction from the war.

              The most important way to protect the environment is not to have more than one child.

              by nextstep on Wed Oct 10, 2012 at 02:49:17 PM PDT

              [ Parent ]

              •  That's nice. (0+ / 0-)

                But you haven't supported your core argument, which is that increasing taxes or corporations and the wealthy will cause significant disinvestment.

                •  This has been seen repeatedly in the US and in (0+ / 0-)

                  other countries over the past 60 years.  When taxation on investment have been reduced, GDP growth increased over the next few years.  

                  All of the industrialized counties with large positive trade balances (as % of GDP) and low unemployment (Germany, Sweden, South Korea, Singapore, Switzerland, Netherlands, Canada, Taiwan, Hong Kong, Australia, etc.) have lower net taxes on investment than the US.   All of the above countries have higher GDP growth and lower unemployment than the US.  You will not find a country with higher taxes on investors that has a lower unemployment rate than in the US, nor one with higher GDP growth.

                  The most important way to protect the environment is not to have more than one child.

                  by nextstep on Wed Oct 10, 2012 at 03:27:09 PM PDT

                  [ Parent ]

                  •  Now THAT is interesting. (0+ / 0-)

                    Now by "taxation on investment" do you mean capital gains taxes? Corporate income taxes? Individual income taxes? Something else?

                    •  The combined impact of all these investment (0+ / 0-)

                      taxes is what matters most.

                      The most important way to protect the environment is not to have more than one child.

                      by nextstep on Wed Oct 10, 2012 at 05:24:41 PM PDT

                      [ Parent ]

                      •  I think the problem with this... (0+ / 0-)

               that what you're calling "taxes on investment" are what everyone else calls "taxes."

                        Why are "taxes on investment" so special compared to "taxes on working your ass off"? The exact same logic applies, right? Why should I work another yea many hours this week when I know 35%, or 28%, or 25%, or 15%, or whatever, is coming off the top?

                        I get what you're saying about the risk, i.e., you're risking 100% of your investment but only keeping 85% of the upside, but on what basis does risk trump work? Why are capital and risk sacrosanct?

                        •  catfood - I don't think nextstep is advocating (0+ / 0-)

                          He is just pointing out facts that can be evaluated in public policy discussions. Countries with lower taxes on production have better balance of trade accounts and faster GNP growth. Tax policy is about more than just fairness, it includes how the policy impacts national employment and growth.

                          "let's talk about that"

                          by VClib on Wed Oct 17, 2012 at 08:24:17 PM PDT

                          [ Parent ]

            •  An interesting Fact Democrats & Republicans never (0+ / 0-)

              bring up is:

              During every Democratic President's term after FDR, the top marginal tax rate on investors declined. The exception to this is Pres Obama, but his time in office is not over.

              - Truman proposed and cut the top margin rate
              - JFK started the tax cut, LBJ signed it into law
              - Carter opposed reducing the Capital Gains tax rate, but with Democrats in control of the House and Senate his veto was overridden.
              - Republicans in Congress proposed and Clinton dropped the Capital Gains tax from 28% to 20%.

              During this same period, all of the marginal tax increases on investors were done by Republicans - Nixon and George H W Bush.

              The most important way to protect the environment is not to have more than one child.

              by nextstep on Wed Oct 10, 2012 at 03:02:44 PM PDT

              [ Parent ]

          •  Doesn't matter either way (0+ / 0-)

            If demand is growing for your business, and hiring is what needs to be done to meet that demand (else lose business to other employers who have to pay the same taxes in the end), then...

            having marginally higher taxes paid for the owner doesn't amount to much, because...

            while a higher percentage may be paid on the total income, the total income naturally is also rising if you're meeting higher demand.

            I thought all this was Econ 101.

            Your scenario only matters if we're truly moving towards a soaking degree of income taxation.  Nobody is calling for that.

  •  Underwear gnomes tax plan (1+ / 0-)
    Recommended by:
  •  I hired a guy who does yardwork (3+ / 0-)

    to mow and clean up my yard every few weeks.  My neighbor liked his work and hired him too.  That makes me a job creator, so if R & R get in, I'd better get my sweet a$$ tax cut!

  •  Does Romney even know (4+ / 0-)

    ..that in our system of governance we have a "weak President" who doesn't actually set tax policy?

    His wet dreams of financial dictatorship don't pass the smell test even if you agreed with his plutocratic nonsense.

    Perhaps one day the Fourth Estate will take their jobs seriously. Or not.

    by Anthony Page aka SecondComing on Wed Oct 10, 2012 at 08:58:35 AM PDT

  •  AND the same as Ronald Saint Reagan in 1981! (3+ / 0-)
    Recommended by:
    JeffW, tb mare, Steve Magruder
    In fact, what Romney is proposing is exactly the same thing as Bush proposed in 2000—and we wall know what happened when we tested his theory.
    We've had TWO bites at this particular poisoned apple.

    "Push the button, Max!" Jack Lemmon as Professor Fate, The Great Race

    by bartcopfan on Wed Oct 10, 2012 at 08:59:10 AM PDT

  •  Wiley Wonker And The Math Factory.... (1+ / 0-)
    Recommended by:
    tb mare

    Romney and Ryan prove Einstein correct:
      "Insanity is doing the same thing over and over again and expecting different results".

  •  Okay, I'm ashamed to admit (1+ / 0-)
    Recommended by:

    but I watched a few seconds of Piers Morgan - Obama's truth lady (Stephanie?) was on.

    Piers is going after her because of the $5t tax cut, because the Romney campaign said it was a lie, that they were paying for the tax cut with their as yet undefined loophole closing.

    So he brings her on and asks her, well actually TELLS her that she was wrong because the tax cut's size is cut down by these TBD loophole closings.

    So he says the tax cut is not $5t, so therefore the ad is wrong.

    Ugh.  I had to scrub down after that.

    Later (shame on me) I flipped by again, and he brought on some actress I've never heard of who claims she has been savaged because she's supporting Romney.  Pearls were clutched.  About 5 seconds of that.

    I spent a moment trying to figure out how to e-mail him, to ask why he didn't spend this much energy debunking the welfare lie, the medicare lie, the no trade deals lie, blah blah.

    He's an obvious shill, so it would have been a waste of time.  

    But enough shills and the attack begins to fall flat, even though it's on the nose.

    Why is it that a 3% tax increase for the wealthy is considered "socialism" and an 8% wage cut for the middle class is "doing your part"? MartyM

    by delphine on Wed Oct 10, 2012 at 09:09:39 AM PDT

  •  20% across the board not really true. (0+ / 0-)

    Although Romney and others describe his rate cut as "across the board", the rate cut does not apply to dividends, capital gains and interest - those get taxed at current rates.  See

    As the wealthy, on average, get a much larger share of their income from capital gains, dividends and interest than the rest of the population, they get a much, much lower percentage benefit from the "20% rate cut" than non-wealthy income taxpayers.

    This is why Romney says the wealthy will pay the same or a higher share of income taxes than they do now.

    Just a view from an economist.

    The most important way to protect the environment is not to have more than one child.

    by nextstep on Wed Oct 10, 2012 at 09:10:42 AM PDT

    •  R/R eliminating capital gains tax (0+ / 0-)

      Mitt Romney wrote that he wants to eliminate the estate tax entirely.  See

      Romney wants to eliminate the capital gains tax for people making less than $200k per year, what he calls the middle class. "No Apology" by Mitt Romney, p.129-130, Mar 2, 2010

      Paul Ryan wants to eliminate the capital gains and dividends taxes entirely.  See

      They are deliberately setting aside the capital gains and other taxes because they want to get rid of them (quietly), not because they want to leave them alone.  This makes the deficit numbers worse, not better.

  •  Most middle income Americans have no idea (0+ / 0-)

    how much they are paying in taxes.  The fact is they are paying damn little.  And people with small businesses who bundle their taxes in their personal returns are getting extra special tax benefits insofar that they pay taxes at the lower person rate rather than the higher business rate.  Moreover, as businesses they can evade paying sales taxes on their supplies while none of these small business people pay a penny of taxes on employee expenses like wages.  Despite all their childish whining small business people have it too cushy as it is.  

  •  It's even dumber than that (3+ / 0-)

    If Romney's whole case is that "tax cuts spur growth," then why is he suddenly saying the wealthy will pay the same amount they're paying now? By his (flawed) logic, making them pay what they're already paying means he won't be giving them the tax cuts that supposedly spur this magical growth.

    "I can't come to bed yet! Someone is WRONG on the Internet!" - XKCD

    by SingularExistence on Wed Oct 10, 2012 at 09:17:01 AM PDT

  •  say I try to buy a car... (4+ / 0-)

    ...and tell the salesman I'll pay for it with the money I save on getting better gas mileage.  Think they'd go for that?

    This is just one step above Mitt claiming he'll pay for his tax cuts for the rich by "praying for God's blessings."

    I don't know how he's getting away with this shit, anyway.  I know Republican voters are stupid (oh my fucking GOD they're stupid - I work with 'em, I can tell you more amazing stories than Speilberg) but Mitt keeps claiming he'll "cut taxes" for them, but remove a bunch of deductions.  In what way is that cutting taxes?  "I'm going to cut your taxes, but you'll end up paying more."  It's complete absurdity.  The only reason Republicans are backing this shit Romney's saying is because they don't believe a damn word of it.

    One Republican even flat-out told Soledad O'Brien a few days ago that he's not worried by the more moderate policies Romney talked about in the debate, 'cuz he knows once Romney gets into office he'll do hardline conservative things instead.  Soledad said, "But doesn't that mean he's lying?  And you're okay with that?!"  and the Republican just said "It's good campaign strategy."  Soledad was amazed the guy was saying this stuff.

    But, that's Romney's whole deal -- say a bunch of moderate-sounding stuff to appeal to blinking complete idiots who'll believe him ( cough Stacey Dash cough cough) while trusting conservatives to know he's spreading bullshit.

    Romney's really amazing, anyway... it's beyond sociopathia and into some kind of magic.  He says the "47%" stuff behind closed doors, gets caught, and thinks he can just erase it by saying "Oh, no, now that I'm out in public you should know I'm for 100% of everybody."  Just unbelievable horseshit.  It should be studied by psychologists for decades...

    "Glenn Beck ends up looking like a fat, stupid child. His face should be wearing a chef's hat on the side of a box of eclairs. " - Doug Stanhope

    by Front Toward Enemy on Wed Oct 10, 2012 at 09:24:34 AM PDT

  •  Reminds me of this: (0+ / 0-)

    The trouble with the world is that the stupid are cocksure and the intelligent are full of doubt. Bertrand Russell

    by accumbens on Wed Oct 10, 2012 at 09:25:48 AM PDT

  •  Romney's plan delivers a tax cut to the wealth (0+ / 0-)

    I made this point in a diary last week following the debate:

    It is clear from the context that Romney is generally referring to limited liability companies (“LLCs”), partnerships, and subchapter S corporations as “small businesses.”  But it is absolutely not true that they pay taxes at the individual rate, because none of these entities normally pays income taxes.  Instead, their earnings are passed through to their owners, and their owners pay income taxes on those earnings.
    This is a simple misrepresentation of the tax system, and Romney certainly knows better (most of the Bain entities that he has invested in are partnerships, for example).  So why is Romney lying about this?

    The answer is that he is trying to set up a category of taxpayers—“small businesses”—to which he can deliver a tax cut that will overwhelmingly favor the wealthy, while claiming that he is not cutting taxes of the wealthy.


    "Well, I'm sure I'd feel much worse if I weren't under such heavy sedation..."--David St. Hubbins

    by Old Left Good Left on Wed Oct 10, 2012 at 09:43:59 AM PDT

  •  How much growth? (1+ / 0-)
    Recommended by:

    If Romeny reduced the tax rate by 20% and limited deductions to $50,000 how much will the economy need to grow to make up for the lost revenue? And when was the last time that the economy grew by that much. And how much did the economy grow by when Bush or Regan did the same? It seems like there would be a fairly specific rate of growth needed and would most likely be wildly unrealistic.

  •  Caption (0+ / 0-)

    These are my magic underwear. They're invisible.

    When you don't vote, Mitt happens.

    by shoeless on Wed Oct 10, 2012 at 09:52:12 AM PDT

  •  Romney's plan is essentially to use the tax code (0+ / 0-)

    to protect the wealthy if and when the next Republican President comes along and crashes the Economy again making it legally justified to implement harsh austerity upon the rest of the Nation. Nice.

    Maybe America would be better served if what constitutes a "small business" we're more honestly and clearly defined. Those that pass their business through their personal taxes...the Subchapter S corps...are all legally considered small businessmen, something most political junkies already know. This is how people like the Kochs file and they're billionaires. Most if not all investment firms as well. When Republicans give public speeches and talk about the plight of the small businessman and their abusive tax burdens THESE are the people they are talking about. Ask any non-politico how they define a "small business" and they undoubtedly list mom and pop shops around town. I've always hated this misunderstanding that so many people have and most are surprised to say the least when the truth is shown to them.

  •  Mitt Headroom (0+ / 0-)

    Mitt Headroom m-m-makes sense of it all. Check it out:

  •  So the illogic continues... (0+ / 0-)

    "And so when you're running up the taxes like that, you're taxing job creators, and that's not how you keep jobs here."

    So again Romney is trying to promote the Repub crapola that a "job creator" will forego a profit that is 97% of the former after-tax amount and refuse to hire more workers given that demand is warranted because of a 3% increase in tax.  No wonder over 90% of new business start-ups go bankrupt the first year!!!!!  BTW- Mitt is trying to pretend  that it is mom and pop places are affected.  " that's not how you keep jobs here."  If we are talking mom and pop where the fuck ARE the jobs gonna go?

  •  Why Oh Why....isn't the Mainstream Media (0+ / 0-)

    Calling Romney out on changing positions every 24 to 48 hours. Can it be that the Mainstream Media is owned by Corporations?  How cynical am I?

  •  How much growth is required (0+ / 0-)

    I posted this comment in another diary yesterday.

    This is the fudge factor that Romney and Ryan are counting on to make their lousy math work. I believe it will be Ryan's escape strategy in the debate with Biden.

    I've yet to see anyone quantify how much growth would be needed to equal the difference between the cost of the tax cuts ($5 trillion) and the potential savings from ending tax credits for things like mortgage interest, charitable donations and medical expenses.

    I'd like our side to have that number before the BS emerges from Ryan.

    The fact is, the tax cuts are always going to come first, and the growth is just wishful thinking (dis-proven by previous trickle down tax cutting). The gamble that this would not increase the deficit in practice would be an irresponsible one to take. Weigh that against the certainty that well-off Americans will benefit before ANY growth happens or any popular tax credits are ended.

  •   I hope and pray that the Obama/Biden campaign (0+ / 0-)

    come up with a way to explain all this in a simple, compelling, engaging way.  Cartoons.  Simple graphs.  Colorful graphics.  Simple and brief history lessons.  Put it in historical context, but keep it brief.  

    We need to TELL A SCARY STORY about Romney and Ryan.  This should be the easiest thing in the world.  Forget about pointing out how he flip-flops.  One reason he flip flops and lies all the time is to create a confusing smokescreen that masks THE REAL STORY.  Romney and Ryan are just figureheads for the biggest heist in world history.  They want it all.  This isn't hyperbole:  the want to privatise (read: TAKE) water supplies, educational systems, social safety nets... and of course they have already taken over so much.  Why can't this be the dominant story?  Why do we shy away from looking at the big picture?  This isn't conspiricy, these are just PLANS.  

    It is so sad that so many millions of people have been taught that the enemy that is "taking over" is the big, scary government or scary poor people.  

    I know this is complex... changing people's minds and worldviews.  But you would think that it wouldn't be that hard to SCARE the crap out of people with Romney and Ryan.

  •  Fool me once, shame on you... (0+ / 0-)

    A brilliant philosopher once said, "Fool me twice...don't get fooled again."


    When states need revenue to take on new projects, do they raise or lower taxes&fees to accomplish them?

  •  another idea (0+ / 0-)

    When Obama is hitting Romney on this nonsensical tax plan, he can also use it to really take control of the whole narrative on job creation and the economy.  One thing I wish he would do is fight against the whole notion of the wealthy being "job creators."  Obama should make the case that it is the middle class and working class who are the TRUE job creators, because without us buying houses, cars, and other goods and services, there is no economic growth and no job creation.  We in the middle class are the ones who spend most of our income on the things that make the economy grow.  And Romney is going to hurt the job creators of the middle class by RAISING TAXES on us, cutting services that we need, and making healthcare and education less affordable.

  •  Claims that cuts won't contribute to deficit but (1+ / 0-)
    Recommended by:

    essentially plan factors in that growth will necessarily occur by cutting, which means that Mitt's promise of revenue neutrality is achieved by "counting chickens before they hatch".

  •  massive transfer of wealth (0+ / 0-)

    to the wealthy, from everyone else.

    Capping deductinons for high income people means nothing.  Romney has taken capital gains taxes off the table, so the wealthy remain unaffected.

    Equally bad, he will eliminate the estate tax.

    The middle class and the poor will pay for this massive gift to the wealthy.

  •  So the NEXT question (1+ / 0-)
    Recommended by:

    is what rate of growth would be needed over what period to

    a) reach break even on the plan
    b) cover the losses between now and the break even point
    c) how large would those ;losses grow in the meantime and where would the funds come from to make up the difference while the growth was taking place?

    Never mind asking about where in the economy such growth wou;dl occur.

    You know, like asking the fucker what the fuck he is fucking well talking about and expecting the fucking voters to be able to absorb that information and act on it.

    Unfortunately, any fucking answer that might make sense will be so far above the heads of the average American voter that there is no fucking point asking the question, let alone expecting dumb-fuck to attempt an answer. Unless, maybe, just ,maybe, someone can get Big fucking Bird to explain it to them in langauge fit for a 3 year old because THAT, friends, is the level of fucking discourse evident in this goddamned campaign.

    Because, oh I don't know

    AND GUNS!!!!

    I pretty ,much give up.

    That RMoney even appears on any fucking survey with ANY percentage of the electorate prepared to vote for him instead of commit him to serious, and prolonged psychological evaluation and support is about a crime against humanity.

    Never mind Bush and Cheney, about half of the American public needs to be in front of the goddamned International Court.


    Christ what a mess you people have made.

    Until inauguration day The USA is in the greatest danger it has ever experienced.

    by Deep Dark on Wed Oct 10, 2012 at 12:38:41 PM PDT

  •  Not Bush's plan, not Romney's plan (0+ / 0-)

    The plan does not belong to any specific Republican, and it belongs to all of them.  How can that contradiction be? Because the "plan" is nothing more than the standard Republican handful of magic beans. By the time Republican voters take them home and water them and figure out that they aren't going to sprout, the politician who sold them has long since term-limited out.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site