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Obama: Romney tax plans increase burden on middle class

August 01, 2012|By Kathleen Hennessey
  • President Obama campaigns in Akron, Ohio.
President Obama campaigns in Akron, Ohio. (Jim Watson / AFP/Getty Images )

AKRON, Ohio — Campaigning in contested territory, President Obama on Wednesday used Mitt Romney’s tax proposals to frame the election as a choice between policies that would benefit the wealthy and those that would help the middle class.

In two stops in the north-central part of the state, Obama slammed his unofficial GOP opponent for trying to revive failed trickle-down tax plans. Obama noted that Romney himself would benefit from his plans to cut tax rates for the nation’s top earners and pointed to a new study that bolstered his claims.

“Ohio, we do not need more tax cuts for the wealthiest Americans,” Obama told a crowd of 3,000 people at a civic center in downtown Akron. “We need tax cuts for working Americans.”

Obama’s remarks in Akron, and earlier at an outdoor rally in Mansfield, continued his campaign’s sharpening focus on the divide between the president and his rival on taxes.

The president is campaigning on a pledge to allow the George W. Bush-era tax cuts on the wealthiest Americans to expire at the end of the year as scheduled. Romney, and his Republican allies in Congress, want to extend the current lower tax rates across the board. Romney has also proposed additional cuts.

Obama has increasingly punched up the tax contrast, shedding some of the formality of his “official” speeches. The crowd seemed in sync — jumping in to boo, cheer and laugh at Obama’s favorite punch line — a reference to his graying hair.

On Wednesday, the president hit the tax theme hard, touting a new study from the Tax Policy Center, a project of the Urban Institute and the Brookings Institution, Washington-based policy centers. The study found Romney’s tax proposals would dramatically cut tax bills for the rich, but require either higher taxes on the middle class or higher budget deficits. Romney has said his plan would lower the deficit.

The Tax Policy Center report looked at the impact of Romney’s major tax changes — cutting individual income tax rates by 20%, extending the Bush-era tax cuts, cutting corporate tax rates, eliminating the estate tax and Alternative Minimum Tax, and repealing taxes in the president’s healthcare law. The proposal would eliminate $360 billion in tax revenue in 2015, the report found.

Romney’s plan does not specify how the former Massachusetts governor would make up for the revenue. But the all-but-certain target would be to eliminate deductions in the tax code, such as for mortgage interest and charitable gifts, the researchers argued. Romney and Congress would have to eliminate 65% of all deductions and credits to make up for the lost revenue, the report found.

Romney’s campaign dismissed the report as “liberal” and flawed, noting that it did not take into account the potential impact of Romney’s proposed cuts to corporate taxes or federal spending.

“This is just another biased study from a former Obama staffer that ignores critical parts of Gov. Romney’s tax reform program, which will help the middle class and promote faster economic growth,” said Romney policy advisor Lanhee Chen. “The study analyzes only half of Gov. Romney’s tax program.”

One of the study’s authors, Adam Looney, worked as an economist on Obama’s Council of Economic Advisors. But Obama punched back in Akron, noting that another “used to work for Bush.” William Gale was a senior economist for the Council of Economic Advisors under President George H.W. Bush.

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