For the top 0.1 percent, the difference is even more stark. Romney’s plan would save them an average of $725,000. President Obama would raise their taxes by $450,000.
Romney and Obama’s tax proposals for the rich offer a window into how differently the two men understand the economy: what makes it tick, what the government can do to encourage wealth and how to rebuild the middle class.
Both men seek to assuage a growing anxiety among Americans about their economic security. But they use different language to describe the problem and offer different cures.
Obama has repeatedly called income inequality “the defining issue of our time.” He has proposed raising taxes on millionaires, saying on Tuesday that “broad-based prosperity has never trickled down from the success of a wealthy few.”
Romney, by contrast, waves off Obama’s talk of income inequality as the “politics of envy.” He says the best way to lift people out of poverty and raise wages is to help businesses become more successful. Ease regulations on businesses and lower taxes, Romney argues, and people’s fortunes will rise.
Neither candidate has a strong record of stemming a decades-long trend in this country of widening fortunes between the wealthiest Americans and everybody else.
Obama has overseen a recovery that has overwhelmingly benefited the wealthy. A recent study showed that the top 1 percent of Americans enjoyed 93 percent of the income gains from 2010, the first year of the recovery.
In Massachusetts, Romney did little to reverse the trend of income inequality that was happening in his state. And his work at Bain Capital embodied a pure distillation of American capitalism in which higher returns for investors, not worker pay, were the highest priority. If elected, Romney has pledged to curb deductions and other tax benefits for high-income households, but he has not been specific.
The Occupy Wall Street movement brought a new level of awareness to Americans of the growing income disparity between the richest 1 percent and the rest of the country. Obama is betting that a longer national conversation about inequality will help him win reelection. Romney, whose own income puts him in the upper reaches of “the 1 percent,” thinks that strategy will backfire.
“I think it’s fine to talk about those things in quiet rooms and discussions about tax policy and the like,” Romney said in January on “The Today Show.” “But the president has made it part of his campaign rally. It’s a very envy-oriented, attack-oriented approach, and I think it will fail.”
When Romney was governor of Massachusetts from 2003 to 2007, his state, like many others, was experiencing growing inequality between top and bottom earners.