This morning, President Obama will call on Congress to extend the Bush tax cuts just for those under $250,000 — an effort to put Republicans on the spot by forcing them to declare that they won’t support a middle class tax cut unless it’s coupled with an extension of the Bush tax cuts for the rich.
Moments ago, Mitt Romney’s campaign rolled out its response:
“President Obama’s response to even more bad economic news is a massive tax increase. It just proves again that the President doesn’t have a clue how to get America working again and help the middle class. The President’s latest bad idea is to raise taxes on families, job creators, and small businesses. Almost half a million fewer Americans are working today than the day Barack Obama took office, and we’ve just come through the worst job creation quarter in two years. Unlike President Obama, Governor Romney understands that the last thing we need to do in this economy is raise taxes on anyone.”
When Romney describes this proposal as a “massive tax increase,” what he means is that calling for an extension of the cut for those under $250,000 is equivalent to calling for a tax hike on those over $250,000 — or, as he puts it, a tax hike on “families, job creators, and small businesses.”
But allowing the high end tax cut to expire would only impact two percent of American taxpayers, Roberton Williams of the nonpartisan Tax Policy Center tells me. That means Romney is describing a proposal to cut taxes on the vast majority of American taxpayers as a tax hike, because Obama’s plan does not also cut taxes on the top two percent.
What’s more, even those taxpayers would benefit from Obama’s plan, Williams says, because the portion of their income under $250,000 would be taxed at the lower rate. Only their income over $250,000 would be taxed at a higher rate if the high end cuts expire.
The Tax Policy Center has not estimated the average size of the tax increase the top two percent would suffer under this scenario. But it has estimated that the top one percent would see their after-tax income go down by all of seven percent.
Putting aside the numbers, note Romney’s claim that this proposal “proves again that the President doesn’t have a clue” how to “help the middle class.” In other words, his response, with no exaggeration, is that extending tax cuts for those under $250,000 won’t help the middle class. Oh, and a tax cut is actually a tax hike!
This is a candidate and a campaign who seem to proceed from the assumption that they can say literally anything, no matter how absurd or Orwellian, without getting called out aggressively by news orgs or suffering any political consequences for it. I guess we’ll find out soon enough whether they’re right.
UPDATE: Post edited slightly for accuracy.