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Post Leadership
Posted at 01:09 PM ET, 01/17/2012

Where Mitt Romney’s tax rate will actually cut him


(David Goldman - AP)

Mitt Romney places $10,000 bets. He says he’s been afraid of getting a pink slip, despite being worth millions. And the man who hasn’t yet released his tax returns, but now says he plans to in April, revealed Tuesday that his effective tax rate is probably just 15 percent.

Anyone paying attention to the debate over whether or not Romney would release his tax returns probably can’t be too surprised at this outcome. Pundits have been speculating for weeks why he hasn’t —from whether he might have money stored offshore to whether his tax rate would be low. As someone who is mostly living off of the capital gains and dividends from his vast wealth, it’s not really all that surprising that his tax rate would balance out this way. 

What “little” non-investment income Romney has had, he notes, has been from his book, which he gave away, “and then I get speaker’s fees from time to time, but not very much,” he told reporters at a gathering in Florence, S.C. Maybe in his world. Romney’s financial disclosure forms, according to the New York Times, show that he earned $374,327.62 in speakers fees from February 2010 to February 2011, averaging $41,592 a pop. By some measures, that alone would nearly qualify him for being in the low end of the so-called “one percent.” One speech would earn him an amount that’s more than three-quarters the amount of the median household income in the United States.

Who knows how much the 15-percent tax rate will hurt Romney as a candidate. What I would guess could hurt him more is saying things so out of touch with the realities of average Americans. Many who would consider voting for Romney don’t begrudge him his wealth, or perhaps even the fact that he pays low taxes. But what probably isn’t going to help him is talking about $374,000 as being “not very much.”

Voters don’t mind seeing success, even runaway success, in their leaders. If anything, most people like the idea of someone who’s done well in their careers running the show. But they also want to rally behind a leader who seems in touch with their world view, and who can identify with and relate to their problems and their struggles. Even if Romney can do this, comments like these won’t help him make that case.

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