Tax Policy Center: Romney Tax Plan Would Increase Taxes On Lower, Middle Class

TPC: Romney's Tax Plan “Would Provide Large Tax Cuts To High-Income Households, And Increase The Tax Burdens On Middle- And/Or Lower-Income Taxpayers.” A recent study by the nonpartisan Tax Policy Center determined that for Romney's tax plan to be “revenue-neutral,” as he has asserted, it would have to “provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers”:

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. [Tax Policy Center, 8/1/12]

Right-Wing Media Responded By Calling Tax Policy Center “Class Warriors”

Fox's O'Reilly And Crowley: TPC's Findings Are “All Conjecture” And “Their Bias Is Built Into The Conjecture.” Fox News' Bill O'Reilly said the Tax Policy Center's study was “basically theoretical.” Fox contributor Monica Crowley stated that the study had “bias” built in:

O'REILLY: So the president is basing his projections of Governor Romney taking money from the poor and the working people and giving it to the fat cats on analysis by the Tax Policy Center, which is very complicated. It has to do with phasing out deductions, and all kinds of things that are basically theoretical; they're not real things. But the president is taking this and his guys have taken this and run with it, saying that now Romney wants to take from the folks and give it to the rich people. Now, I'm laughing because, and I'm not favoring Romney over Obama or anything like that. It's so patently absurd, yet the president clearly believes what is he saying.

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CROWLEY: First of all, the Tax Policy Center, one of the two authors of what we are talking about here happened to serve on Obama's Council of Economic Advisers from 2009 to 2010.

ALAN COLMES (Fox News contributor): The other served Bush.

O'REILLY: It doesn't matter whether they served. It's all conjecture.

CROWLEY: Right. And their bias is built into the conjecture.

O'REILLY: Right. It's all, it could, it might, they might have to do this. And he assigns it as fact.

CROWLEY: Correct. And that's very irresponsible on the part of the president.

O'REILLY: People should know this. [Fox News, The O'Reilly Factor, 8/7/12] 

WSJ: TPC Is “A Liberal Think Tank” And Its Study Is “A Highly Ideological Tract.” A Wall Street Journal editorial on the Tax Policy Center's analysis derided the nonpartisan organization as “class warriors.” The editorial continued:

[Obama's] charge is that even though Mr. Romney is proposing to cut tax rates for everybody across the board, Mr. Romney will finance this by imposing a tax increase on the middle class. His evidence is a single study by the Tax Policy Center, a liberal think tank that has long opposed cutting income tax rates.

The political left always says Daddy Warbucks gets all the tax-cut money. So this is hardly news, except that the media are treating this joint Brookings Institution and Urban Institute analysis as if it's nonpartisan gospel. In fact, it's a highly ideological tract based on false assumptions, incomplete data and dishonest analysis. [The Wall Street Journal, 8/7/12]

Wash. Post's Jennifer Rubin: TPC Is “Left-Leaning” And “Very Partisan.” Washington Post blogger Jennifer Rubin dismissed the findings of the “very partisan” Tax Policy Center, writing:

My colleague Greg Sargent insists that by Mitt Romney saying “The president's ad saying I'm gonna raise taxes on the middle class? That's patently, simply false,” Romney is admitting his plan won't be revenue neutral. Not only does Romney not say that, but that very broad proposition is not supported by the left-leaning Tax Policy Center study released last week.

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This is not, by the way, to say that the plan is politically attainable. It is just to say that the very partisan Tax Policy Center didn't prove, as its media advocates have said, that it is “impossible” for Romney's plan to be revenue neutral and maintain progressivity. [The Washington Post, Right Turn, 8/5/12]

Chris Wallace Deflected From TPC To Hype “Another Study” That Is “Nonpartisan.” After Obama campaign adviser David Axelrod pointed to TPC's findings, host Chris Wallace countered with an Ernst & Young report that he called “nonpartisan” and “respected,” suggesting TPC was neither of those things:

WALLACE: You keep bringing up the Tax Policy Center study, and that's fair enough. But I want to ask you about another study by the respected accounting firm Ernst & Young which did a study on all the tax increases that president Obama is proposing, and here's what they found when they analyzed those.

That economic growth with the Obama tax increases would fall by 1.3 percent and employment would fall by 710,000 jobs. Ernst & Young, a nonpartisan respected accounting firm says that raising taxes that much would be a drag on the economy right now. [Fox News, Fox News Sunday, 8/5/12 via Media Matters]

The Tax Policy Center Is Widely Acknowledged To Be Nonpartisan, Experts On Tax Policy

New Yorker's John Cassidy: Nonpartisan Tax Policy Center Economists Are “Acknowledged Experts On The Tax System.” The New Yorker's John Cassidy noted the absurdity in claiming the Tax Policy Center is biased, writing that TPC's analyses are conducted by “acknowledged experts on the tax system”:  

As you might expect, the Romney camp has dismissed the study as a partisan attack, calling it “another biased study from a former Obama staffer that ignores critical parts of Governor Romney's tax reform program, which will help the middle class and promote faster economic growth.” The former Obama staffer is Adam Looney, who worked on tax issues at the Council of Economic Advisers, and who previously worked at the Federal Reserve Board. In addition to contributing to Tax Policy Center studies, he is currently the policy director for the Hamilton Project, a research institute established by Robert Rubin. That marks him out as a fiscally conservative Democrat, I suppose, but it hardly invalidates the study. Another of its other authors, William Gale, once worked at the White House for a Republican President: George H. W. Bush. The third author, Samuel Brown, is another veteran of the Federal Reserve. All three are acknowledged experts on the tax system.

The Tax Policy Center report stands on its own merits, which are considerable. Perhaps the most notable thing about the criticisms from the Romney campaign is that they don't contain any refutations of any individual figures. 

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As I said earlier, the G.O.P. hasn't contested any of these individual findings. Romney's real enemy isn't the Tax Policy Center, the work of which his campaign has praised in other contexts: it is the laws of arithmetic. [The New Yorker, 8/7/12]

Wash. Post's Ezra Klein: “Calling The Tax Policy Center Biased Simply Isn't Credible.” The Washington Post's Ezra Klein wrote:

I can describe Mitt Romney's tax policy promises in two words: mathematically impossible.

Those aren't my words. They're the words of the nonpartisan Tax Policy Center, which has conducted the most comprehensive analysis to date of Romney's tax plan and which bent over backward to make his promises add up.

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[T]he campaign called the analysis “just another biased study from a former Obama staffer.” That jab refers to Adam Looney, one of the study's three co-authors, who served in a staff role on the White House Council of Economic Advisers under President Barack Obama. But the Tax Policy Center is directed by Donald Marron, who was one of the principals on George W. Bush's Council of Economic Advisers. Calling the Tax Policy Center biased simply isn't credible -- a point underscored by the fact that the Romney campaign referred to the group's work as “objective, third-party analysis” during the primary campaign. [The Washington Post, Wonkblog, 8/4/12]

Indeed, Right-Wing Media Have Called TPC “Independent” Or “Nonpartisan” In The Past

WSJ Called TPC, “The Nonpartisan Tax Policy Center,” In Report On Newt Gingrich Economic Plan. In an article on then-presidential candidate Newt Gingrich's tax plan, the Wall Street Journal reported:

The study by the nonpartisan Tax Policy Center--a joint venture of the liberal Brookings Institution and the Urban Institute--offers insight at a time when Mr. Gingrich is moving to the fore among GOP candidates. [The Wall Street Journal, 12/13/11]

WSJ Cited “The Independent Tax Policy Center” In Report On Payroll Tax Cut. The paper cited the “independent” Tax Policy Center to report the differing impacts of Democrats' and Republicans' tax cut extension proposals. On the effect of the payroll tax cut, The Wall Street Journal stated:

The payroll tax cut lowered the taxes paid by working families by an average of $934 per year, according to the independent Tax Policy Center. It also has cost the federal government about $120 billion a year. [The Wall Street Journal, 7/31/12]

Wash. Post's Rubin Cited “Nonpartisan” TPC To Support Her Claims About Herman Cain's Tax Policy. To analyze then-GOP candidate Herman Cain's 9-9-9 tax plan, Washington Post blogger Jennifer Rubin quoted an NBC article deeming the Tax Policy Center “nonpartisan,” and called the TPC an “independent set of eyes”:

Herman Cain certainly has an issue. He's put all his chips on 9-9-9 and brazenly dismissed critics as know-nothings or misrepresenters of his plan. It's become obvious, however, that it is he who is trying to pull a fast on. First Read discovers what many of us have: The plan is highly regressive. Yet another independent set of eyes has looked at Cain's plan now:

The nonpartisan Tax Policy Center is readying a report on Cain's plan, though it is waiting for more details from the campaign. But it has come to some conclusions already.

Cain's plan “cuts taxes for the rich and raises taxes on the poor,” Roberton Williams, a senior fellow at the center, tells First Read. He added that it would create a “much more regressive tax system.”

The plan would represent a “major tax cut” for the rich and raise taxes “substantially” on the poor and middle class, Williams said. “Given that a big chunk doesn't pay any income tax, this would be a big tax increase on people at bottom end. At the top end, the opposite happens.” [The Washington Post, Right Turn, 10/13/11]

Wallace Cited “Nonpartisan Tax Policy Center” As Authority On Pawlenty's Tax Plan. While interviewing then-GOP presidential candidate Tim Pawlenty, Fox News Sunday host Wallace cited an analysis of Pawlenty's economic plan from the Tax Policy Center:

CHRIS WALLACE: Let's drill down first into the tax component of your proposal. The nonpartisan Tax Policy Center says if we follow your plan, that it would result in $11.6 trillion less revenue for the country over the next 10 years. Your own campaign says it would mean $2 trillion less in revenue. ... Doesn't your plan blow a hole in the national deficit? [Fox Broadcasting Co., Fox News Sunday, 6/12/11, via Nexis]

Wallace Used TPC Analysis In Reporting On Obama, McCain Tax Policies. Fox's Chris Wallace also used Tax Policy Center studies to report the effects of then-candidate Senator Obama's and Senator McCain's tax policies during the 2008 election. He reported on Fox News Sunday:

And so the battle has been joined about [who] really is the big taxer this year.

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[A] non-partisan group called the Tax Policy Center analyzed Obama's tax plan and McCain's tax plan this week, and they say Obama's plan redistributes income to lower- and middle-income people, while McCain's gives most of the benefit to the wealthy. Is that an advantage for Democrats? [Fox Broadcasting Co., Fox News Sunday, 6/15/08, via Nexis]