PRINCETON ECONOMIST: ROMNEY TAX PLAN MATHEMATICALLY SOUND

Big Government ^ | 7 Oct 2012 | TONY LEE

[Snuph]

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.

[Snuph]

Adding, subtracting, dividing, multiplying, simply too much for the DNC base to understand. Easier to just lie to them.

[Principled]

LOL!

this is going to be funny wherever it comes up.

[WashingtonSource]

Take that, axelgrease and fluff-butt!

[Principled]

The economy would have to grow by 3 percentage points more over the term of his plan than it would have without his plan.

If we pick it up again [remember the early 80s?] we will crush 3%.

[muawiyah]

What we don’t want to happen again is to lose deductions just to get a lower rate. That’s simple wealth redistribution ~ a marxist notion.

[Principled]

Yeah and later, the deductions won’t come back but the rate will sure increase!

The singular attraction that I have for the flat income tax is that each person’s marginal rate is the same. Lots NOT to like about it but that one is big.

[bigbob]

One thing we know for certain is that Obama’s plan does not work.

[oblomov]

Democrats only believe in zero-sum economics.

[God luvs America]

i’m sure the criminal liberal media will be quoting Professor Rosen as much as they do the other economist from Princeton...

[conservatism_IS_compassion]

What we don’t want to happen again is to lose deductions just to get a lower rate. That’s simple wealth redistribution ~ a marxist notion.

Yeah and later, the deductions won’t come back but the rate will sure increase! The singular attraction that I have for the flat income tax is that each person’s marginal rate is the same. Lots NOT to like about it but that one is big.

Having seen the ObamaCare abuse of the IRS, I think we all can see value in moving away from an income tax.

That aside, one deduction I would like to see eliminated is the mortgage interest deduction - and the taxability of interest income. That was the Steve Forbes position, and he clearly was right. Why? Because if everyone is in the same tax bracket, the tax paid on interest income is exactly balanced by the tax savings accruing to the payer of the interest. So it is all a bunch of paper shuffling - with the exception that some people don’t itemize deductions, and they lose out in the deal.

The realtors took down the Forbes presidential campaign over the issue, but Forbes should have rebutted by pointing out that municipalities already get the same break, and the result is that tax free bonds pay lower interest to compensate for the lack of a tax on them. So all Forbes really was proposing was that home buyers be able to “sell tax-free bonds” when they get their mortgage loans. Therefore it was really a benefit to the lower-income borrower, since he wouldn’t have to itemize the payments in order to benefit. Forbes should have instituted a grandfather clause for existing mortgages - and if the borrower wanted to have the new system, he would only need to refinance the mortgage to get it.

[muawiyah]

The best way to avoid double taxation of the same money is to abolish the income tax completely.

[UnwashedPeasant]

Market forces are like gravity, no matter how much the Left tries to explain it away.

[UnwashedPeasant]

"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..."

Romney should bring a pie to the next debate to help explain this concept.

[phockthis]

sfl

[Cobra64]

Adding, subtracting, dividing, multiplying, simply too much for the DNC base to understand. Easier to just lie to them.

The numbers just measure past results and aid in predicting effect (think Laffer Curve).

This is the best concise explanation of the relationship of taxes vs. government revenue I've seen since I was an Econ major in college in the '70s:

"There's No Escaping Hauser's Law"

Link:

http://online.wsj.com/article/SB10001424052748703514904575602943209741952.html

[Snuph]

agreed.

[Cobra64]

Go to the link. It’s a fantastic article that should be required reading by every democrat.

[Eye of Unk]

If its anti-communist it must work.

[Principled]

The best way to avoid double taxation of the same money is to abolish the income tax completely.

There are other important beneficial outcomes of eliminating the income tax besides avoiding double taxation!

eliminate hidden taxes in higher prices
eliminate hidden taxes in lower wages
eliminate hidden taxes in reduced ROI
eliminate withholding
eliminate the export tax penalty [border adjust]
make the US the world's place to headquarter business.

[sten]

one thing Romney said was that the ‘rich’ will continue to pay the same tax rate

if ‘rich’ is defined as anyone making $250/yr (married) ... then we’re still screwed

I’m basically paying a flat tax. my expenses don’t exceed $12k/yr ... so anything I make is taxed at an absurd level (35% + 2*15% == 50%)... and that’s set to increase (bush cut == 5%, 0bamacare 6.1%, resulting in 61.1%)

why would I choose to operate a company in a country that demands 61% of my profits while other countries only ask 10%??