Romney/Ryan plan: Tax-free living for the rich

Yes, as through this world I’ve wandered

I’ve seen lots of funny men,

Some will rob you with a six-gun,

And some with a fountain pen

-Woody Guthrie, “Pretty Boy Floyd” (1939)

Leave it to Woody Guthrie, our great American poet, to stick it to the man in four short lines. Woody was about as blunt a fellow as you can imagine.  He was certainly not one to mince words when it came to calling out economic injustice and the exploitation of working people.

Investigative reporter and author David Cay Johnston is another blunt man. Johnston also pulls no punches when he warns middle-class voters about the devastating effects of Romney/Ryan economics:

Under Romney’s plan your economic future would be determined the same way it was in 18th century France—primarily who you picked as your parents, not by hard work, perseverance and that illusive element of luck

If you’re looking for someone who can explain the Romney/Ryan tax proposals in a clear, understandable way then Johnston, president of Investigative Reporters, is your guy. In an article published on September 7, 2012, entitled “Romney and Ryan’s Dangerous Tax Roadmap,” Johnston explains how the tax structure Romney and Ryan are selling as simplified and fair is in truth a scam proposal for “tax-free living for the richest Americans.”

In case voters don’t get what a Romney/Ryan economy will look like, Johnston explains that “lower taxes for the already rich and highly paid” will inevitably mean “heavier burdens on the middle class along with cuts in government service.”

Shall we put the Republican tax plan into context so we can understand what’s going on here?  According to CNN Money, if the Republicans have their way on just one element of the tax code—eliminating the estate tax—the Republican presidential nominee’s estate could save at least $90 million. If Romney/Ryan are given the chance to legislate their tax vision, Johnston explains that “more than $21 million of Romney’s 2012 income of $21.6 million would be untaxed.”  (I’ll let readers draw their own conclusions on the “appearance” of a conflict of interest.)

And on the gift tax and our possible new president’s family? It’s uncertain how the Romneys have gamed the system so successfully:

His [Romney’s] plan would retain the gift tax, but it is already so porous that, as Reuters reported in January, the five Romney sons enjoy tax-free  income from a $100 million trust fund on which no gift taxes were paid. Only about $2 million could have originally gone into the trust without triggering gift taxes.

Johnston, along with independent economists and tax experts, is hoping (probably in vain) that voters understand that the Romney/Ryan tax proposals are no more than a reprise of the catastrophic Republican economic policies of the Bush era. As Johnston recalls,

those policies ushered in flat to falling incomes for the vast majority, weak job growth, but skyrocketing incomes for the top one percent of the top one percent, including Romney.

And how about Romney and Ryan’s math?  Well, Johnston thinks they need to go back to elementary school to relearn some basic math skills:

Slashing tax rates, keeping the share of income taxes paid by the top unchanged and increasing military spending without any additional red ink may win votes from innumerates, but it is a mathematical impossibility.

Johnston has earned his reputation as a meticulous researcher who trusts the experts, assembles the facts, and ignores the spinners and big talkers—like the statistics-spewing Paul Ryan. (I’m with Johnston on giving the experts their due.  I once hired a New Jersey burglar-turned-locksmith who confided to me:  “Who better to advise you on how to secure your windows than a guy like me who knows firsthand the in’s and out’s?”)

One of Johnston’s sources who also knows the in’s and out’s is Edward Kleinbard, a highly successful, and now repentant, tax lawyer who “spent decades . . . finding creative ways for clients to defer or escape their obligations.” According to Kleinbard,

The Roadmap [the Ryan Budget] is a mechanism for redistributing tax burdens down the income scale.  Most ordinary Americans would see their tax burdens increase by around 50 percent, while the most successful individuals would see reductions in their labor income tax rates and elimination of all capital tax burdens – including the elimination of the gift and estate tax.

Kleinbard, as Johnston points out, has studied the Republican tax plan and concuded that it would

. . . turn individual and corporate income taxes into the equivalent of two large payroll taxes with the burden falling almost entirely on workers, not  owners and executives.

Evidently, Romney and Ryan wouldn’t have hired my burglar-turned-locksmith expert just like they won’t be hiring tax experts from the nonpartisan Tax Policy Center whose conclusions they reject.  Here’s Johnston again:

The Romney campaign told me it pays no heed to analyses by the Tax Policy Center, even though Romney cited its work when it favored him in   the primaries.  The nonpartisan center is led by Donald Marron, a former economic official in the administration of Republican President George W. Bush.

By the end of his article Johnston is unequivocal in his unmasking of Romney and Ryan as two pen-wielding, wannabe robbers:

Romney and Ryan would shove the burden onto those with less, a radical plan by an oligarch and his partner in promoting tax-free living for the richest Americans.