Romney Tax Plan Mathematically Sound

Romney Tax Plan Mathematically Sound

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“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#1 Oct 7, 2012
Princeton Economist: Romney Tax Plan Mathematically Sound

by Tony Lee
7 Oct 2012
11:32 AM PDT

Bill Clinton, President Barack Obama, and liberal think tanks have claimed Mitt Romney's plan to cut tax rates across the board by 20 percent is bad arithmetic, but a Princeton economics professor, Harvey Rosen, examined Romney's proposals in a paper and concluded Romney's plan would work. The economy would have to grow by 3 percentage points more over the term of his plan than it would have without his plan.

Liberals, who often do not understand how the economy works let alone how to expand the economic pie, failed to work in their assumptions that the purpose of Romney's tax cuts is to actually grow the economy, which would make people more prosperous. And as the economy grows and more people get jobs, the government would get more tax dollars.

The Tax Policy Center, which is affiliated with the center-left Brookings Institution and Urban Institute, analyzed Romney's tax plan assuming there would be zero economic growth. The lead analyst in the Tax Policy Center's study was a former Obama administration official.

"At the same time, the TPC model assumes that regardless of the tax rate, people work the
same amount, save the same amount, and invest the same amount," Rosen wrote in his paper. "Thus, changes in the tax code have no effect on the amount of before-tax income."

And, as The Weekly Standard pointed out, there are "at least three critical flaws" with the the TPC study:


(1) it assumes pro-growth tax reform can't actually produce economic growth,(2) it assumes two tax expenditures worth $45 billion per year are not 'on the table', and (3) it assumes tax reform must pay for repealing Obamacare's tax hikes, rather than assuming that the repeal of Obamacare's spending will pay for repealing the tax hikes.

If these assumptions are taken away, Romney's plan becomes more feasible.

Rosen also wrote that "it seems odd to assume away possible increases in incomes associated with a
given tax reform proposal when its explicit goal is to enhance growth."

"Rather, a more sensible approach is to consider alternative assumptions about how tax reform might affect the size of the economy, and see how they affect the substantive conclusions," Rosen wrote.

Rosen concluded that if the economy grew, Romney's numbers would add up and that growth rate needed to make Romney's numbers add up was "not impossible."
Seattle Slew

Seattle, WA

#2 Oct 7, 2012
We're supposed to believe a guy who lies, NO THANKS !~

WE WERE BUSHWHACKED, but you knew that, right ???

IrishMN <quoted text>
When have you ever seen me beating the drum for Bush by saying he did not start diggin us into the hole we are in?
The best thing Bush did was leave office.
We could not afford 4 more years of GWB.....

Yet, ALL of you hypocrite humper bois CRY, whenever we mention ANY Bush culpability !??? WOW ! What a moron/*ss.... Mae West would be proud of you boobs ! LMAOROTF !
Unfit Mitt

Minneapolis, MN

#3 Oct 7, 2012
Too bad almost no other economists agree.

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#4 Oct 7, 2012
Seattle Slew wrote:
We're supposed to believe a guy who lies, NO THANKS !~
WE WERE BUSHWHACKED, but you knew that, right ???
IrishMN <quoted text>
When have you ever seen me beating the drum for Bush by saying he did not start diggin us into the hole we are in?
The best thing Bush did was leave office.
We could not afford 4 more years of GWB.....
Yet, ALL of you hypocrite humper bois CRY, whenever we mention ANY Bush culpability !??? WOW ! What a moron/*ss.... Mae West would be proud of you boobs ! LMAOROTF !
Hey Honey Slew Slew...here's a hint for you: Bush is not running in 2012.

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#5 Oct 7, 2012
Unfit Mitt wrote:
Too bad almost no other economists agree.
Name them and cut & paste their studies to doncument your lies. You are the Queen of Cut & Paste, aren't you?
Seattle Slew

Seattle, WA

#6 Oct 7, 2012
doncument Ps- Nice "spelling" mental midget....

Here's a return hint, bush messed it up for 8 years, it WILL TAKE TIME TO FIX, fool....

We're supposed to believe a guy who lies, NO THANKS !~
WE WERE BUSHWHACKED, but you knew that, right ???
IrishMN <quoted text>
When have you ever seen me beating the drum for Bush by saying he did not start diggin us into the hole we are in?
The best thing Bush did was leave office.
We could not afford 4 more years of GWB.....
Yet, ALL of you hypocrite humper bois CRY, whenever we mention ANY Bush culpability !??? WOW ! What a moron/*ss.... Mae West would be proud of you boobs ! LMAOROTF !

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#7 Oct 7, 2012
Seattle Slew wrote:
doncument Ps- Nice "spelling" mental midget....
Here's a return hint, bush messed it up for 8 years, it WILL TAKE TIME TO FIX, fool....
We're supposed to believe a guy who lies, NO THANKS !~
WE WERE BUSHWHACKED, but you knew that, right ???
IrishMN <quoted text>
When have you ever seen me beating the drum for Bush by saying he did not start diggin us into the hole we are in?
The best thing Bush did was leave office.
We could not afford 4 more years of GWB.....
Yet, ALL of you hypocrite humper bois CRY, whenever we mention ANY Bush culpability !??? WOW ! What a moron/*ss.... Mae West would be proud of you boobs ! LMAOROTF !
Damn. You got me on a typo. My bad.

Yet you bring no facts to dispute what I said. Hmmmm...very interesing.
Seattle Slew

Seattle, WA

#8 Oct 7, 2012
As I recall, you ask to be paid to provide facts, what's the offer, again ?? HMMM ?...very interesing

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#9 Oct 7, 2012
Seattle Slew wrote:
As I recall, you ask to be paid to provide facts, what's the offer, again ?? HMMM ?...very interesing
I provided facts. You provided nothing - again.

Good drugs tonight for you, huh Honey Slew Slew?
The Truth

Minneapolis, MN

#10 Oct 8, 2012
Too bad almost no other economists agree.
The Truth

Saint Paul, MN

#11 Oct 8, 2012
The Truth wrote:
Too bad almost no other economists agree.
As of this morning Romney is leading in the Swing State polls.

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#12 Oct 8, 2012
The Truth wrote:
Too bad almost no other economists agree.
Most economists don't agree. Why do you spew this crap?

I provide a study that says Romney's plan works. You say it doesn't, yet you have no study to back up your claim.

You prove your stupidity and dishonesty daily on here. Good job, Bobbie.

Since: Jul 12

Minneapolis, MN

#13 Oct 8, 2012
You provide a biased report with numbers that don't add up.

Trickledown didn't work for Bush and it won't work for Romney.

Me, instead of living off the government like you, I have to work and don't have time to play your silly games.

But I'd be happy to meet you after work this evening to further dicuss the matter. Where would you like to meet?

Since: May 11

Burnsville, MN

#14 Oct 8, 2012
Tax cuts do not magicaly produce economic growth. Although 3% isn`t great growth. If tax cuts alone produced growth why haven`t we seen outstanding growth since the Bush tax cuts were imposed??
Consistent

Grantsburg, WI

#15 Oct 8, 2012
Snake Dr wrote:
Tax cuts do not magicaly produce economic growth. Although 3% isn`t great growth. If tax cuts alone produced growth why haven`t we seen outstanding growth since the Bush tax cuts were imposed??
Do you know the History on when it was determined that allowing people to "Keep" the wealth that the individual "earned" (Google the word earned), and spend as they choose in the Free Market, does not create a growing economic system?

I know that your insights on Economucs is driven by ignorance, and I know that Economucs was a big area ub study in your Urban Cessapool.....This is why I aks you for the History on the issue.
The Truth

Saint Paul, MN

#16 Oct 8, 2012
Consistent wrote:
<quoted text>
Do you know the History on when it was determined that allowing people to "Keep" the wealth that the individual "earned" (Google the word earned), and spend as they choose in the Free Market, does not create a growing economic system?
I know that your insights on Economucs is driven by ignorance, and I know that Economucs was a big area ub study in your Urban Cessapool.....This is why I aks you for the History on the issue.
You can't even SPELL economics, and I doubt you even graduated from high school.

Hell, you can't even figure out how to use spell check!
Consistent

Grantsburg, WI

#17 Oct 8, 2012
The Truth wrote:
<quoted text>
You can't even SPELL economics, and I doubt you even graduated from high school.
Hell, you can't even figure out how to use spell check!
Clown,

I spelt Economucs EXACLTY how I intended for the Poster I was addressing.

“The one and only Smart Liberal”

Since: Aug 12

Former MN Tax Payer

#18 Oct 8, 2012
Toidi Slayer wrote:
You provide a biased report with numbers that don't add up.
You really are one funny guy.

I provide a study by a Princeton Economist. You provide nothing and then claim my study is biased.

You mean to tell me that the DailyKos crap you post all the time here is not biased? Amazing.
Toidi Slayer wrote:
Me, instead of living off the government like you, I have to work and don't have time to play your silly games.
Hollow insults again from the angry little man. My company does occasionally get checks from the government. But those are for work that we do to help insure your fat ass remains safe.

However, less than 5% of our business comes from Uncle Sam. So I don't think that qualifies as "living off the government".
Toidi Slayer wrote:
But I'd be happy to meet you after work this evening to further dicuss the matter. Where would you like to meet?
I have said many times, I have far better things to do with my time than to waste it meeting up with an angry person like you.

Life is good. Go to the Conservatory at the Como Zoo and smell the flowers. Enjoy yourself and smile.
Capt Crunch

Saint Paul, MN

#19 Oct 8, 2012
After watching Wednesday's debate, it's obvious that the time has come to move to the next phase of the debate over Mitt Romney's tax cut. His tax cut plan remains a massive liability, but it's time to dismantle it using political jujitsu by turning the force of Romney's own words and arguments against him. And it can be done with a simple two-part plan.
First, focus primarily on the fact that Romney is proposing to cut taxes by 20 percent on everybody—including the top one percent. When Mitt Romney talks about his tax plan, he calls it an across the board 20 percent tax cut for everybody, including the top one percent. When Democrats and the Obama campaign talk about it, they generally call it a $5 trillion tax cut. Because the total cost of Romney's tax cut adds up to $5 trillion, that's an accurate line of attack, but Mitt Romney never uses the $5 trillion figure. As we saw on Wednesday, that allows him to muddy the waters.

Meanwhile, there's tons of video of Mitt Romney talking about it as a 20 percent tax cut. It's easier to make that attack stick because it's using his own words against him. Plus, it's easier for people to visualize why it's crazy to cut taxes on the top one percent by 20 percent than it is to talk about $5 trillion.

Second, acknowledge that he has offered one scenario in which his numbers add up: the voodoo trickle-down scenario under which cutting taxes on the wealthy magically creates so much economic growth that it doesn't add to the deficit. Every independent analyst who has looked at Mitt Romney's tax plan says that his numbers don't add up—and that to pay for it, he'd have to raises taxes on the middle class or add to the deficit. That's a good and accurate argument, but as we saw on Wednesday, Romney can answer it by simply saying that he would never raise taxes on middle class or add to the deficit. Unfortunately, simply citing independent analysts isn't a slam dunk way of rebutting such an assertion—even though it's right.

A better approach is to use Mitt Romney's own arguments against him. Here's what he said during the debate: "I also lower deductions and credits and exemptions, so that we keep taking in the same money when you also account for growth." On Thursday, his campaign has endorsed an AEI analysis making exactly the same case.
Capt Crunch

Saint Paul, MN

#20 Oct 8, 2012

On the one hand, acknowledging that Romney is making this argument concedes that he has in fact outlined one scenario in which he is able to achieve his stated principles without raising taxes on the middle class or raising the deficit. But in exchange for acknowledging that fact, you get to hang the entire Bush economic philosophy around Mitt Romney—in his own words.

Bush's economic theory was that if you cut taxes across the board, the economy would boom, making up any lost revenue. His ideas failed spectacularly, and everybody outside the Republican bubble knows it. And Mitt Romney is now defending his tax plan using the exact same economic philosophy.

In short, Mitt Romney is proposing a 20 percent tax cut on everybody, including the wealthiest Americans. He says he'll pay for that in part by eliminating deductions and in part by economic growth. In other words, he's claiming to have discovered a new kind of math where if you cut taxes, revenue booms. But he's hardly the first to make this claim, and turning that argument around on him is as easy as pointing out how miserably it failed under George W. Bush.

It's not that there's no value in pointing out that Romney's tax cut would cost $5 trillion or that it would end up raising taxes on the middle class. The problem is that leading with those arguments can be tough sell to undecided voters because Mitt Romney has avoided describing his plan in those terms.

But he does describe his plan as a 20 percent across the board cut for everybody, including the top one percent. And he does admit that the only way his plan adds up is by assuming it will create economic growth. Those are pretty damning words, so let's do some jujitsu on his voodoo.

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