Mathematically impossible. It is, as your signature and Pres Clinton say, a matter of Arithmetic.
The TPC gave Romney's plan the benefit of every doubt, with generous assumptions about economic conditions, tax progressivity, bias on behalf of programs that incentivize savings and investment and the growth that the program would inspire.
Nothing worked. No matter how the economists massaged the numbers, the middle class still would wind up getting socked with a tax increase. The richest of the rich are so rich that if they get the same 20 percent cut in their marginal rate that everyone else does, the 1 percent still comes out way ahead. You can't eliminate enough deductions and loopholes to make up for it.
That means you have to make deeper cuts in the "tax expenditures" (deductions) that broadly benefit the middle class-things like the home mortgage interest deduction and deductibility of employer-provided health insurance.
If you factor in other promises that Romney has made, such as not cutting defense spending or Social Security and Medicare benefits for today's senior citizens or about-to-be senior citizens, things get even worse.
http://www.dailycamera.com/ci_21257137The paper:
Our major conclusion is that a revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed – including reducing marginal tax rates substantially, eliminating the individual alternative minimum tax (AMT) and maintaining all tax breaks for saving and investment – would provide
large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers. This is true even when we bias our assumptions about which and whose tax expenditures are reduced to make the resulting tax system as progressive as possible. For instance, even when we assume that tax breaks – like the charitable deduction, mortgage interest deduction, and the exclusion for health insurance – are completely eliminated for higher-income households first, and only then reduced as necessary for other households to achieve overall revenue-neutrality– the net effect of the plan would be a tax cut for high-income households coupled with a tax increase for middle-income households.
In addition, we also assess whether these results hold if we assume that revenue reductions are partially offset by higher economic growth. Although reasonable models would show that these tax changes would have little effect on growth, we show that even with implausibly large growth effects, revenue neutrality would still require large reductions in tax expenditures and would likely result in a net tax increase for lower- and middle-income households and tax cuts for high-income households.
It would be possible to reduce the regressivity of such plans or even to maintain progressivity in such plans with reductions in the tax rate cuts for high-income taxpayers and/or significant reductions in the tax preferences for saving and investment, including the preferential rates on capital gains and dividends.
http://www.brookings.edu/research/papers/2012/08/01-tax-reform-brown-gale-looneyAnd we all know that the last paragraph is not what Romney proposes - he has specifically said he will keep the preferential rates for capital gains and dividends.
The response of the Romney campaign to this was to accuse the Tax Policy Center of bias - despite quoting it themselves:
Romney Camp Cited Same Think Tank They Now Denounce As ‘Liberal’
= new reply since forum marked as read
