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Discussion: (2 comments)

  1. Max Planck

    I saw the piece too, but it misses the point. While there’s no “evidence” Romney is suggesting a rise in “middle class” (sic) taxes, the cut in marginal rates has to be paid for SOMEWHERE. And many other plans that have been floated do the same thing, OR limit deductions, which is the same thing as a tax hike, for all intents and purposes. My commentary below:

    “I think the big joke here is that everyone is falling over themselves to offer a lower marginal rate, which is not necessarily helpful. For one thing, lowering rates (effectively offering a “flatter” tax) reduces the deductibility of mortgage interest, property tax, State and City taxes BY ITSELF, building in an offsetting TAX INCREASE even as marginal rates are lowered. Nobody seems to get this no matter how many time I explain this to them. The most elegant and effective solution RIGHT NOW is to RAISE RATES. It will lower the cost of borrowing as much as any Fed program, and make real estate more attractive as a purchase. This is what we need TODAY. The cut in marginal rates is little more than an illusion and always was- which is why TEFRA 1986 was an astounding failure.”

    1. The report shows that Romney has defined a series of parameters to his plan that mathematically require a middle-class tax hike. Those parameters are a 20 percent rate cut, no increase in taxes on savings and investment, reducing tax deductions to pay for the lost revenue, and revenue neutrality.

      Whether Romney “wants” middle-class tax cuts is not the issue. Romney is proposing a set of conditions that would require them.

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