Mitt Romney crashes on taxes in the final stretch
Only when candidates speak in private do they reveal who they really are and what they really think. Mitt Romney did that in his remarks secretly recorded at a dinner for $50,000 and up donors to his campaign in Boca Raton, Florida, in May. We should not forget what he said to those donors:
"There are 47 percent of the people who will vote for the president no matter what . . . who are dependent on the government, who believe they are victims . . . These are people who pay no income tax . . . My job is not to worry about those people . . . I'll never convince them they should take personal responsibility and care for their lives."
Romney has since described his taped comments as "inelegant", but has defended them as reflecting what he apparently believes.
Who are those approximately 47 percent of households who don't pay federal income tax? A portion of them, about 22 percent, are retired senior citizens living on Social Security, Medicare, retirement savings, and modest pensions. About 8 percent are either unemployed or full-time students or disabled, including military veterans. Most of the remaining households that don't pay federal income taxes are simply lower-income families of workers who pay federal payroll taxes on their earnings but don't make enough income to owe federal income tax.
The federal government collects payroll taxes in excess of 15 percent only on wages earned by labor. Mitt Romney is exempted from paying payroll taxes to the extent he treats his compensation from Bain Capital as income from capital, either dividends or capital gain. Working families actually pay a higher total rate of federal taxes than Mitt Romney, who has reported paying only 13.9-14.0 percent federal income tax for the only two years for which he has chosen to release his tax returns.
That low rate of federal income tax means that virtually all of Romney's income is being reported at the capital gains rate which is capped at 15 percent, unlike the rate on ordinary earned income from labor which is capped at 35 percent. For 2011 Romney reported adjusted gross income of $13.7 million, none of which was from wages subject to payroll taxes.
Romney has already said he's not worried about the very poor because there's a safety net. And now he says he's not going to worry about the working poor either, or non-contributing retirees or students or the disabled.
Instead Romney will focus on across-the-board cuts in the federal income tax which 47 percent of households don't pay. The tax cuts he advocates include lowering the rate on capital gains to zero percent, and eliminating entirely the federal tax on the largest decedent's estates, which Romney calls the "death tax". He says he can make the cuts revenue neutral by eliminating unspecified loopholes and deductions, which would increase taxes for unfavored taxpayers. But nobody believes that can actually and politically be done.
The arrogance of the richest man ever nominated to run for president towards working American families ought to be disqualifying. Newt Gingrich and Rick Santorum were right. Romney is indeed the worst possible candidate the Republicans could put up against President Obama.
Romney divides Americans into makers and takers, self-made entrepreneurs such as himself, and teeming masses of lazy freeloaders. Born into a wealthy family, educated in private schools, Romney is among those born on third-base but who think they hit a triple.
America applauds and rewards its entrepreneurs, but they achieved their success on the infrastructure, the highways, airports, schools, law enforcement, national defense, courts, and other institutions, including the social safety net, which have been achieved through democratic self-government.
Romney's Ayn Rand-ist vision of America is blind to that reality. We are, in fact, all in this together.