David Simon, creator of The Wire, says this regarding Mitt Romney’s magnanimous admission that he pays a whole 13% rate in taxes:
Can we stand back and pause a short minute to take in the spectacle of a man who wants to be President of The United States, who wants us to seriously regard him as a paragon of the American civic ideal, declaiming proudly and in public that he has paid his taxes at a third of the rate normally associated with gentlemen of his economic benefit.
Stunning.
Am I supposed to congratulate this man? Thank him for his good citizenship? Compliment him for being clever enough to arm himself with enough tax lawyers so that he could legally minimize his obligations?
via David Simon | Mitt Romney paid taxes at a rate of at least 13 percent. And he’s proud to say so..
Simon, of course, is quite familiar with the lives of those on the other end of the economic spectrum — those who bear the brunt of the abdication of civic responsibility on the part of people like Romney. They are the ones down-on-whom-it-has-trickled.
Discuss
36 Comments . Leave a comment below.Romney paid taxes on the money he has invested. We have lower rates
on investment income so people are willing to risk their monies in stocks. Thus, this is a second bite at the apple.
Unlike VP. Cheapskate who donates 0.03% of his income to charity, the Romneys donate millions upon millions, thus lowering their tax rate. Cap the charitable deduction to $10K. I am sure we will hear the squeals at Harvard Univ if that happens.
. . . but I have to disagree. Investment income represents just that – income – and therefore cap gains taxes don’t represent a second bite at the apple. If cap gains taxes applied to principal, that would be a second bite at the apple.
Also, historically the reason our cap gains tax rates have been so low is because our business tax rates are among the highest in the developed world. Personally, I would like to see that reversed.
Ultimately, I do believe there is something unfair about taxing capital at a lower rate than labor. As a defender of the free market (disclosure – I used to work for the Pioneer Institute), I believe in the economic benefit of a low rate on capital gains. That being said, however, I also believe that one of the fundamental principles of any tax code must be fairness and, if the construction laborer is paying 28% on the $55,000 he’s pulling down, but Mitt Romney’s paying only 13% on the $X million, which, because he doesn’t have a salary, represents his income, I think that’s a problem.
I just don’t understand the brouhaha over Romney paying the legal rate on investment income. What are e ramifications if the capital gains tax rate were increased to 25%-30%? Not everyone has a taxpayer backed state pension. What would happen to the stock market and everyone’s 401-K? The risk to an employer for hiring the wrong person is firing and finding a replacement worker(unless it’s a union public worker, then we are stuck for eternity). But risking ones monies on stocks is something different, monies not as easily replaced.
Since you worked for the Pioneer Institute, what do you think of the idea of having regional tax brackets. For example, a person making $55K in Massachusetts should pay a much lower federal tax rate than the same wage earner in Tenessee. Someone earning $300K in NYC should not pay the same rat as the same wage earner in Texas, where the cost of living is much lower. I know Obama wants to raise taxes on millionaires and billionaires (couples earning over $250K a year) but a couple earning that salary in Mississippi has much lower living costs than a couple in NJ.
Let me know your thoughts and thanks for the civil tone. I get lots of flack on this board because I have radical ideas such as stating that Harvard Univ. needs to start paying federal taxes or to coin a Democratic phrase, “their fair share”. After all, they have a $32 Billion endowment fund, surely they can pay something.
Please bear in mind that these are, for the most part, off the top of my head and certainly haven’t been researched or scored. If someone has numbers to the contrary, I’m all ears.
1) My guess is the ramifications of increasing the cap gains rate would, at the very least, include capital flight. The $32 trillion that’s reported to be parked in offshore havens would probably become $40 or $50 trillion. Clearly, that wouldn’t be good for the American economy. Any attempt to increase the rate would have to be done slowly in an attempt to minimize, to the extent possible, the potential for capital flight.
2) I’ve also wondered whether it’s possible to introduce a graduated cap gains rate, so that an investor would pay, say, the current rate on the first $100,000 of investment income, 20% on investment income between $100,000 and $500,000, 30% on investment income between $500,000 and $1,000,000, and finally, say, 36% on anything over a million. I have no idea if this is at all practicable.
3) The idea of regional tax brackets is an interesting one. I made a similar argument a few years back during the debates over raising the eligibility requirements for SCHIP to $61,000 for a family of four. Now $61,000 is not a lot of money for a family of four living in Brooklyn, but my guess is that it can provide a reasonably comfortable existence for the same family living in Enid, Oklahoma. Should SCHIP eligibility be the same for both?
Ultimately, I don’t know what the longterm consequences would be of the creation of either regional eligibility requirements or regional tax brackets. And my guess is that those consequences would go beyond the merely logistical. For example, would regional tax brackets have any impact on migration patterns within the U.S.?
And, as for the civil tone, I am the holder of what my more liberal friends consider certain, let’s call them, heretical beliefs. I was just castigated by one on Facebook for advocating the privatization of the USPS. So I too appreciate a certain civility of discourse.
I agree with your thoughts on capital leaving if we tax it higher. Our problem now is trying to get that capital BACK into our economy. Some here have talked about forcing it back in to which I ask how? If I’m sitting on $1B and I don’t want to put it here in the USA then how can I be forced to do it.
I don’t agree with your graduated Cap Tax since people will work around it and it puts you back in to the “punish” the guy who takes a chance and wins.
I can’t imagine a “regional” tax bracket passing legal or political muster. Why would we charge a person living in NYC more taxes than someone living in Cave City, KY?
According to Brian Siullivan from CNBC, the middle class has enjoyed a substantial tax reduction and the numbers on raising their taxes would be large.
video
I hear Obama his followers always say we need to raise taxes on millionaires and bilionaires who are defined as couples earning $250K per year or and individual making $200K.
As part of a major tax reform package, I would submit to you that a couple makking $250K in NYC/NJ pays much more in city/state/sales/tolls/property taxes, etc than the same couple who lives in Memphis or Dallas.
What I would propose is if the top tax bracket under Mitt’s plan is 28% with limited deductions. So why not have that bracket start at $250K in the Southeast, but in the Northeast, it begins at $300K since the cost of living is much higher. Just a thought, that is all.
I know of a couple in NY/NJ who have a visceral reaction whenever Obama says they need to pay more or their fair share and they fall in the Obama net as millionaires and billionaires even though they earn around $250K. Both work 12 hours a day and after all the taxes and fees are paid and the AMT kicks in, they pay 50% of their total income in taxes. To boot, now they have to fork over college costs for kids. Can you imagine cutting a $55,000 check to BU or BC?
Proposals to increase the capital gains tax already include a threshold. Most local taxes are already deductible.
Any bold proposal will limit deductions on local taxes such as 3K for property.
Now you understand? Flatter simpler tax reform.
People are free to live wherever they want, but they also decide how much money they’ll make to live there. I know tons of people who would like to live someplace else but they want to make more money. It’s almost lie saying if somebody wants to be a mail carrier but they want to make $200K. Well too bad, if you want to be a Mail Carrier then you only make $50K, that’s a personal choice.
If you want to live in Cave City, then you’ll make $X and if you live in NYC then you make $Y. Both have income implications, tax implications, local costs, local benefits… We don’t need the tax code to interfere with this free market principle… IMO.
I was going to say that I think Dan meant the opposite, that the person living in Cave City, KY would pay a higher effective rate than the person living in NYC.
As to your other points, though, I agree to a point with both. Absent increased capital controls, which, in my limited reading of history, are regarded as one of the contributing factors of the Great Depression, there is no way to compel capital that is currently on the economic sidelines back into the game.
As for the increased complexity that either a graduated cap gains tax or regional tax brackets would create in our tax code, it is possible they would create loopholes. The two tend to go hand in hand.
Ultimately, as the consensus seemed to be in the video you linked to, at current and projected rates of spending we’re all going to have to pay more.
that we ALL need to pay something to Fed Income tax which currently a large portion of our population (some say 50%) pay ZERO Fed Income Tax. We all should pay something, even 5% minimum.
Is there a reason I or we should give 2 hoots as to what David Simon says… about anything?
But then, perhaps, is there a reason I or we should give 2 hoots as to what JohnD types… about anything?
Congress writes a bill allowing people to get large tax credits for installing solar panels. Are people who buy these panels and use the tax credit “immoral” or “unpatriotic” or are they simply using a credit the country setup to encourage an activity. Using mortgage deductions… are you being clever and not being a good citizen?
This is a bother bogus line of comments from another water carrier.
… if you heard what was said without knowing who it was that said it?
for him or any other hypocrite.
It has been said, often and loudly, that the devil can cite scripture to his own ends: While this may be profoundly true, it does not make scripture less than scripture.
Or, put another way, your problem with the hypocrite ought be that he doesn’t himself believe in his own statements, or that he lives at odds with them, and NOT, to be certain, the implicit assumption of falsity of the statements.
When Romney says 13% we don’t know what that is 13% of. It could be 13% according to a very special calculation whereby he earns close to nothing each year.
This is how both Harry Reid and he could be right. Come to think of it, Romney lies more than Reid, so maybe –
I know some countries have it the other way where people have to prove their innocence but I always thought the USA had it the other way.
Shall we just make charges against people we don’t like without any proof and when they deny it, we respond “then prove you’re innocent”
1. See my Son of BOSS post: one of his areas of expertise is precisely this kind of rule bending.
2. See Saletan’s article at Slate on Romney’s stand on abortion. He has lied about it at least three times out of political expediency. At least three, maybe thirty.
3. See Romney’s oft-repeated falsehood that Obama has been “apologizing” for America.
I’m skeptical of people I don’t know; I trust my friends; I don’t believe people who have been dishonest multiple times.
does that mean any charge by anyone against Romney is gospel until it is proven to be wrong. Can an opponent charge Romney with liking sex with animals and it becomes verity until Romney take’s a polygraph disproving the charge? Go ahead and be skeptical but look at how you and others have already changed their story. Harry Reid makes a baseless partisan charge that Romney paid no taxes for 10 years and the Democratic base takes off with this (of course since it’s aligns with the campaign narrative) and now Romney says he paid 13% but you say 13% of what… WELL, what happened to he paid NO TAXES?? Harry said no taxes and now you are debating 13% of what? Even if it’s 13% of some lower adjusted number it still is more than “NO TAXES” so how about acknowledging Harry was FULL OF SHIT?
Is everyone who disagrees with you a lunatic? By definition?
Did Romney pay no taxes for the last 10 years OR did he pay 13% on a “adjusted gross income”? Personally, I believe what he said. Just like I believe EW didn’t use her Native American heritage (1/64th) to assist her in getting the job at Harvard. I won’t make her “prove” she didn’t use it.
We make nominees seeking Senate confirmation of far less vital roles release more tax information than Mitt Romney has offered.
The best way to answer the question is see his tax returns.
Apparently, accepting any kind of ambiguity is intolerable for those who want to see the world in black and white.
He entered politics and became rich. Harry Truman pegged
people like Reid from the get go. Reid needs to release
his tax returns as should Pelosi, right Tom??
how unworthy of a response this is.
red herring or ad hominem? A Red Hominem or an Ad Herringnem? There’s got to be a term for Dan’s commentary.
Reading his comments is kind of like paying an intelligence tax. For every intelligent comment, we are subjected to Dan’s moron-a-thon.
would be to point out that Dan has behaved dishonorably with respect to stomv and therefore nothing he says should be taken seriously.
Can we call it a surly tax?
I think I smell some fetid air around here …
The old-timer was driving in the middle lane of the superhighway. When he approached cars going slower then him, he yelled “Moron”. When cars passed him on the left or right, he yelled “Maniac”.
One of your ongoing schticks, johnd, has been to get various of the progressives to admit things you think are obviously true.
Your turn.
David (and I, to a lessor extent) has provided a fair amount of evidence that Romney has some trouble telling the truth. To quote you, be honest. We know you like him. We know you’re caught up in his campaign and find him all dreamy. But can’t you admit that he indeed has difficulty telling the truth. Can you really say that he was always ardently pro-life his entire governorship? Are you so taken in by Messiah Romney leading us out of dread Obama Land? Are you really so smitten?
Be honest.
He and the truth just have a rocky relationship.
“I don’t lie, baby, I’m just careless with the truth … that’s all” (2:17)
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