re: Going Deep (rather, piling it deep)

Ryan,

The problem with linking to stuff is that some people will actually go and read it.  First, you link to a couple of articles which praise the economic sensibility of Cain's plan as if they somehow were an indictment of its soundness.  The political hurdles are not insignificant, especially when our side takes to demogogery of it, but there was nothing critical of the basis approach or doubt that if enacted it would accomplish its intended ends.  And now you link to "Romney's" "plan" as if it were some detailed and original proposal.  And the highlights you call out are pretty much the content.

 

Romney's short term plan is to make the Bush tax rates permanent.  And permanently eliminate the Death Tax (which again is a Bush proposal, but a good one nonetheless).  So much for original, well-thought out proposals.  His only original addition is to eliminate taxes on capital gains, dividends and interest for taxpayers making less than $200K.  That is gimmickry.  That is not going to be a huge tax break for those people, because they don't typically have a lot of their income from those sources.  Consequently, it's not going to free up much capital for investment either.  It is purely a move to triangulate between those who advocate for lower taxes on investment income and those who are populists who want tax breaks for middle class earners but not the wealthy.

 

Romney's long term tax plan is even shorter on specifics.  He punts to Bowles-Simpson.  That's his specific long term plan.  And "specific" is kind--he actually punts to the "approach taken" by the Commission as "a good starting point for the discussion," while offering no alternative rate brackets or assumptions of his own.  The Bowles-Simpson tax plan is actually three options, only two of which are actually specific proposals (the third punts to the Finance and Ways & Means Committees and the Treasury to enact unspecified tax reform).  Those two options fit on three power point style slides.  Romney's 13 pages consist of nothing more than vague aspirations for a what a tax plan should look like, wrapped around citations of Bush tax rates and Bowles-Simpson proposals, and no major wrinkle of his own to offer.  Lots of style, but little substance of his own.

Since "Romney's" long term "plan" is actually Bowles-Simpson, or a derivative of it, it is fair to assume that it would meet with the same reception that Bowles-Simpson did.  That is, it would come under fire on several fronts.  The inclusion of health insurance premiums as taxable income, the elimination of deductions and credits, the taxation of dividends and capital gains as ordinary income, and the fact that it actually is a net tax increase on everyone (though a bigger increase on higher incomes) would find enemies among many groups should Romney propose it.  And if you take some of the less radical options, you really are only tinkering around the edges at that point.

 

 So, Ryan, I think my criticism was warranted more than I expected.

--dmac