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September 17, 2012 3:50 PM Backroom Deals

By Ed Kilgore

Mitt Romney and Paul Ryan have had a very difficult time dealing with questions about budget proposals that rest heavily on undisclosed “loophole closing” in the tax code—particularly since the ticket is claiming that despite large and very specific tax cuts for top-income folks and businesses, their share of total tax liability will not go down.

But another default-drive argument from Republicans for stealthiness on tax loopholes is that it will take a great deal of wheeling and dealing with Congress—of the sort conducted during the 1986 tax reform effort—to come up with a politically viable package, so Mitt ‘n’ Paul can’t commit to a specific plan right now.

Okay, that’s at least somewhat plausible, though again, it’s unclear it’s necessary to pre-commit to top-end tax cuts instead of leaving that to the wheeling and dealing, too.

But Paul Ryan is really trying to have his cake and eat it, too, viz. this report from The Hill’s Daniel Strauss:

“We want to say this is our vision: lower tax rates across the board for families and small businesses and work on the loopholes that are enjoyed by the higher income earners, take away their tax shelters so more of their income is subject to taxation. That lowers everybody’s tax rates,” Ryan said.
Ryan added that waiting and then working with Congress would also avoid having to resort to a “backroom deal” to pass their plan.
“And we have to be able to work with Congress on those details, on how to fill it in and more to the point we don’t want to cut some backroom deal that they did with ‘ObamaCare’ where we hatched some plan behind the scenes and they spring it on the country,” Ryan continued.

Really? You’re going to refuse to disclose your policy preferences in order to “work with Congress,” and that will prevent “backroom deals?” I’m afraid this is smoke-blowing of the highest order.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

Comments

  • c u n d gulag on September 17, 2012 4:06 PM:

    If smoked @$$ were a delicacy, the Romney-Ryan campaign would be a delicatessen.

  • gus on September 17, 2012 4:07 PM:

    Exactly!

    I canít decide what is worse about this description of how this will work: the fact that he says it will be transparent (and it wonít be; things donít work like that) or that he isnít just willing to say what loopholes will be closed? How hard could it be to point to ones which are too kind to the upper class?

    Which makes me think he doesnít really know. Heck, Iím sure Romney knows because he asked someone and has benefitted from those loopholes for years. But, Ryan...I keep reading slams that he isnít as bright as heís been puffed up to be.

  • T2 on September 17, 2012 4:22 PM:

    what people need to understand about Ryan is that he is not a genius, a boy wonder, a "wonk". He is a politician and an upward climbing one who always puts his ambition at the top of the list. His family is a rich one. He has been feeding at the public trough for 12 years and jumped on the TeaParty bandwagon because it was an easy way to get high profile. He and Romney are peas in a pod.

  • JohnnyD on September 17, 2012 4:25 PM:

    Backroom deal for Obamacare?! Even us supporters remember the endless Congressional hearings in the summer of 2009 which we thought would never end--the haggling over "single-payer" and "individual mandate" that, eventually, led to a plan that could have been proposed by Republicans ten years ago.

  • Just Guessing on September 17, 2012 4:28 PM:

    Ryan - more of a wank than a wonk.

  • bigtuna on September 17, 2012 4:44 PM:

    Like most of these discussions, 2 minutes with reputable sources would reveal the basic issues.

    The federal govt has about $1 trillion in "tax expenditures" - that is, exemptions that reduce the amount the govt can take it, and in theory his idea is kind of correct - if we can reduce the amount of expenditures, we can reduce the overall rates. The top ones are [in really round numbers]

    1. Tax exemptions for health insurance provided by employers ~ $150 bn
    2. Exclusions of pension beneifits and earnings $130 bn
    3. Deduction of Mortage interest $ 100 bt
    4. accelerated depreciation schedules about $50 bn
    5. Deduction of non business state and local taxes $ 50 bn
    6. Deduction for charity contributions $ 50-60 bn

    etc.

    So someone in Ryan's camp, and Willard's shop, must know this stuff. Hell, MSM reporters should figure this out... it is very easy to find.

    SO. To reduce overall rates by cutting these exemptions, WHICH ONES will you cut, Paul???? One way to do it is to CUT THEM ALL. Gore everyone's ox. This would require that both dems and Repubs swallow some crap they don't like, and jump off the cliff together.

    How likely is that???

  • emjayay on September 17, 2012 4:52 PM:

    True, the ACA could have been proposed by Republicans ten years ago. But it wasn't. It never would have been. They also opposed Medicare, over their dead bodies. (Or should I say the dead bodies of older people.)

    Actually in regards to healthcare, it's pretty wierd that Republicans have never supported anything like the universal health care that every other similar country on earth has some version of, and that has generally been proven to always cost a third or a half less while providing similar or sometimes (and obviously, in some ways like preventative medicine, without even getting the proof) better care. You would think they'd be embarassed or something.

    Could it be that conservatives are too busy imagining American Exceptionalism while waving an American flag to notice what's good about other countries? Could it be that instead of really visiting other countries they tend to prefer to go on a cruise and see a prepackaged tourist version of the world?

    Or when they are younger, spend two years working in a little American island of people with a mansion home base and expensive cars to drive around in (Citroen DS and Peugeot 404), telling French people of all things they should give up coffee and wine and chocolatee and suddenly believe a bunch of brand new American fairy tales.

    Ryan, as exemplified just by his until quite recent allegiance to the theories expressed in one bad novel of one lone Austrian athiest, is a doubly narrow minded ideologue.

  • Peter C on September 17, 2012 4:56 PM:

    Wheeling and Dealing in Congress is going to ELIMINATE special loop-holes for millionaires?????

    Riiiiiggghht!

  • emjayay on September 17, 2012 4:57 PM:

    Good one, Just Guessing. I'm hoping it's exactly his annoying high pitched wankiness will make him look like a jerk besides Biden's caring older guy personna in the debate.

  • meander on September 17, 2012 5:19 PM:

    @bigtuna has it exactly right, and with quantitative data in support.

    Enterprising journalists should start asking Romney and Ryan (and their surrogates) a series of questions like this:

    "OK, I understand that Congress will have to define which tax breaks are eliminated to make your tax cuts revenue neutral. But if Congress sends you a bill that takes away the deductability of mortgage interest on a primary residence, will Romney sign or veto the bill? Or if the bill limits charitable donation deductions for the middle class, will Romney sign or veto the bill? Or a 50% budget cut to the FBI? Sign or veto? Or cutting road funding by 50%? Sign or veto?"

    Regarding the mortgage interest deduction tax expenditure, a memory burned into my mind is hearing my sister's mother-in-law -- who is a hard-core Fox-watching, Weekly Standard right-winger -- react to news that someone proposed reducing the interest deduction as a way of reducing the deficit. Although she is a severe deficit hawk, this news resulted in an outburst about the insanity of such an idea, "Why, they'd kill the housing market with such craziness."

  • jsjiowa on September 17, 2012 7:45 PM:

    bigtuna -- The Washington Post has taken Romney to task on the issue, though it certainly needs wider exposure:
    http://www.washingtonpost.com/opinions/tell-us-mr-romney-how-youd-cut-taxes-but-not-lose-revenue/2012/09/11/69cadac8-fc20-11e1-b153-218509a954e1_story.html

    "A campaign spokeswoman told us that the Harvard study [cited by Romney in his Meet the Press interview] is an analysis by economist Martin Feldstein that weíve written about previously. Mr. Feldstein showed that the Romney math might work if you strip all households with taxable income of $100,000 or more of every dollar of deduction for charitable giving, state and local income tax and mortgage interest. Does Mr. Romney favor such a plan? Would he consider such a proposal to be lowering the burden on middle-income people, even though millionaires would get a break while those in the $100,000 to $200,000 income range would pay more? He wonít say....

    More to the point, could Mr. Romney get far enough to test the proposition ó would he persuade Congress to take away every popular deduction from households making $100,000 or more?

    ďIíve demonstrated that I have the capacity to balance budgets,Ē Mr. Romney said Sunday. That would be more reassuring if he were willing to show the country a plan."

    But yes, the media should keep asking Romney and Ryan if they are committing to Feldstein's analysis that says Romney's tax plan works only if you eliminate all deductions for all income over $100,000. They won't answer it, but their direct dodge would be telling. The press is tolerating their avoidance less and less these days.