Wednesday, October 17, 2012
Romney Lies And Misleads On Taxes and Deficit
ROMNEY MISLEADS: "I'm going to bring rates down across the board for everybody, but I'm going to limit deductions and exemptions and credits, particularly for people at the high end, because I am not going to have people at the high end pay less than they're paying now."
THE FACTS: Romney is proposing to cut all income tax rates by 20 percent, eliminate the estate tax and the alternative minimum tax, maintain and expand tax breaks for investment income, and do it all without adding to the deficit or shifting the tax burden from the wealthy to the middle class. He says he would pay for the tax cuts by reducing or eliminating tax deductions, exemptions and credits, but he can't achieve all of his goals it under the budget rules presidents must follow.
The Tax Policy Center, a Washington research group, says in a study that the tax cuts proposed by Romney would reduce federal tax revenues by about $5 trillion over 10 years. The study concludes that there aren't enough tax breaks for the wealthy to make up the lost revenue, so the proposal would either add to the deficit or shift more of the tax burden on to the middle class.
Romney's campaign cites studies by conservative academics and think tanks that say Romney's plan will spur economic growth, generating enough additional money to pay for the tax cuts without adding to the deficit or shifting the tax burden to the middle class. But Congress doesn't recognize those kinds of economic projections when it estimates the budget impact of tax proposals.
ROMNEY LIES: "A recent study has shown that people in the middle class will see $4,000 a year in higher taxes as a result of the spending and borrowing of this administration."
THE FACTS: Romney's claim is based on an analysis by the conservative American Enterprise Institute that examines the amount of debt that has accumulated on Obama's watch and in a potential second term and computes how much it would cost to finance that debt through tax increases. Annual deficits under Obama have exceeded $1 trillion for each year of his term.
However, Obama is not responsible for all of the deficits that have occurred on his watch. Most of the federal budget — like Medicare, food stamps, Medicaid and Social Security — runs on autopilot, and no one in a leadership position in Washington has proposed deep cuts in those programs. And politicians in both parties voted two years ago the renew Bush-era tax cuts that have contributed to the deficit. Even under the strict spending cuts proposed by Romney, the debt would continue to rise.