Washington Post: Mitt Romney Tax Plan 'Garbage'

[Free Thinker]

The Washington Post's editorial board mocked Mitt Romney's tax plan on Sunday.

"Mitt Romney, the presumed Republican nominee for president, promises to lower everyone’s income tax rate without reducing revenue. This sounds terrific. Why didn’t we think of it sooner?"


The editorial, titled 'Mitt Romney's garbage', argued that Romney's plan to cut taxes and lower the deficit is unfeasible.

"It’s reasonable to assume that his cuts would, as did President Bush’s, worsen the nation’s deficit. Until he’s willing to explain how he would avoid such a result, he has little standing to criticize Mr. Obama’s fiscal shortcomings."
http://www.huffingtonpost.com/2012/08/19/washington-post-mitt-romney-tax-plan_n_1806388.html

 

[Lucrum]

So is Obama's plan...oh wait...he doesn't have a plan.

 

[wildchild]

Quote from Lucrum:

So is Obama's plan...oh wait...he doesn't have a plan.

He has a plan. It hit the democrat controlled Senate floor and was defeated 99-0.

99 to 0 in a chamber that is controlled by his own party.

 

[stoic]

Quote from Free Thinker:

"Mitt Romney, the presumed Republican nominee for president, promises to lower everyone’s income tax rate without reducing revenue. This sounds terrific. Why didn’t we think of it sooner?"

Ever hear of the Laffer Curve?

It's worked before.

Why didn't Obama think of it...? because he's a inept closet Bolshevik!

 

[Epic]

Quote from stoic:

Ever hear of the Laffer Curve?

It's worked before.

Why didn't Obama think of it...? because he's a inept closet Bolshevik!

Personally, I'm getting pretty tired of the Laffer Curve constantly being misrepresented, even by Mr. Laffer himself.

It is thrown around so casually that it has come to be supportive of never ending tax cuts. That is not what the theory indicates. In fact it is far from it. The Laffer Curve is very basic and logical. So logical that it must be correct. The problem is in how those referencing it don't understand it.

"Tax cuts result in higher tax revenues according to the Laffer Curve."

Hardly! Along the majority of the curve, tax increases result in higher revenues and cuts result in lower revenues. Mr. Laffer correctly identified that the law of diminishing returns applies to tax revenues, just like every other area of economics. As tax rates climb, the marginal benefit of each incremental rate increase produces a subsequently smaller increase in revenues.

At some point a tax increase would have no net effect on revenues, and then to follow the theory to its logical conclusion, once you've passed this point further rate increases would actually result in decreases in revenue.

The problem from the GOP standpoint is that we are not anywhere close to the top of the curve. With our current tax code we are firmly located on the steep up-sloping portion of the curve. The average household pays around 12-16%, and even wealthier households rarely pass 20-25%.

I would suggest that the peak of the Laffer Curve is somewhere around 50%. I think that is about the point where people have a strong incentive to either be less productive or more tax evasive. It is a huge mis-characterization to suggest that all tax cuts result in higher or equal revenues.

 

[Brass]

Quote from Epic:

Personally, I'm getting pretty tired of the Laffer Curve constantly being misrepresented, even by Mr. Laffer himself.

It is thrown around so casually that it has come to be supportive of never ending tax cuts. That is not what the theory indicates. In fact it is far from it. The Laffer Curve is very basic and logical. So logical that it must be correct. The problem is in how those referencing it don't understand it.

"Tax cuts result in higher tax revenues according to the Laffer Curve."

Hardly! Along the majority of the curve, tax increases result in higher revenues and cuts result in lower revenues. Mr. Laffer correctly identified that the law of diminishing returns applies to tax revenues, just like every other area of economics. As tax rates climb, the marginal benefit of each incremental rate increase produces a subsequently smaller increase in revenues.

At some point a tax increase would have no net effect on revenues, and then to follow the theory to its logical conclusion, once you've passed this point further rate increases would actually result in decreases in revenue.

The problem from the GOP standpoint is that we are not anywhere close to the top of the curve. With our current tax code we are firmly located on the steep up-sloping portion of the curve. The average household pays around 12-16%, and even wealthier households rarely pass 20-25%.

I would suggest that the peak of the Laffer Curve is somewhere around 50%. I think that is about the point where people have a strong incentive to either be less productive or more tax evasive. It is a huge mis-characterization to suggest that all tax cuts result in higher or equal revenues.

A fairly reasonable post. Sorry, jem et al will never approve.

 

[Lucrum]

Quote from Epic:

...Mr. Laffer correctly identified that the law of diminishing returns applies to tax revenues, just like every other area of economics. As tax rates climb, the marginal benefit of each incremental rate increase produces a subsequently smaller increase in revenues.

At some point a tax increase would have no net effect on revenues, and then to follow the theory to its logical conclusion, once you've passed this point further rate increases would actually result in decreases in revenue.

Makes sense so far.

...I would suggest that the peak of the Laffer Curve is somewhere around 50%...

1)Fact you can back up or just your opinion?

2) And would this "50%" apply to all cultures.

3)You also seem to be assuming that the government NEEDS and or deserves absolute maximum attainable taxation. Despite their long documented history of incompetence waste and inefficiency.

 

[Epic]

Quote from Brass:

A fairly reasonable post. Sorry, jem et al will never approve.

If people are going to make an argument in favor of certain policy, it doesn't do them any good to avoid reality. Obama completely avoided reality during his 2008 campaign and he is suffering for it now. Both campaigns are completely avoiding reality this time around.

If it keeps going this direction, I predict the complete change in party in 2016 regardless of 2012 outcome. If Obama stays, Dems will be tossed out completely in 2016. If Romney wins, then Hillary will win in 2016. The only way to avoid this is to be straightforward with the people and realistic about the situation we are in.

 

[jem]

You truly are an idiot... Brass

I have been teaching you about the curve for a long time... you were the complete asshole who was saying tax cuts were not followed by increases in revenues...

even though in real life tax cuts were followed by increases in revenues... under the tax cuts of:

Bush
Reagan
Kennedy
Melon


As far as when the cuts result in increased revenue... I think logically the line would be far below 50% if you are in a recession. We already know the Bush cuts were followed by increased revenues....

Tax cuts can stimulate investment and hiring.

 

[Brass]

See, Epic?