Comparison of Romney and Obama's budgets

[FranchiseBlade]

This is a cool article that compares Romney's budget and Obama's budget.

Notice that Romney hikes taxes on the tax earners that make the least money, and cuts taxes drastically on the wealthiest of all Americans.

Also it's worth noting that helping to pay for those tax cuts for the wealthy he will cut medicare. So he's heaping a bigger burden on senior citizens and the working poor and lower middle class to give the wealthy a break. The guys a real ass.

I love budgets. And not just because I love tables, charts and appendixes — though, to be clear, I do. I love budgets because they force us to run the numbers, to make trade-offs, to set priorities. The annual budget is, frankly, about as honest as the government ever gets with itself, and with the American people. As I wrote a year ago, President Obama’s 2012 budget showed that the federal government had become an insurance conglomerate protected by a large, standing army. About 40 percent of its spending went to the three major social insurance programs — Medicare, Medicaid and Social Security — and another 23.8 percent of federal dollars went to the military. His 2013 budget shows much the same thing. So this year, I want to focus on the other side of the ledger: how we’re paying for our insurance conglomerate/army right now, and how the two parties propose we do so in the future. Right now, we’re not paying for it. In 2011, federal spending was 24.1 percent of GDP. Tax revenue was 15.4 percent of GDP. That’s a slight rise from 2009 and 2010, when revenue was 14.9 percent of GDP, but all three are near-record lows: Before this financial crisis, the last time federal revenues were below 16 percent was 1950 — which is to say, before Medicare and Medicaid were law, and before Hawaii was even a state. For comparison’s sake, federal revenues averaged 18.2 percent of GDP in the Reagan years, and 19 percent of GDP in the Clinton years. There are two reasons revenues are so low. One is that the Bush tax cuts — which Obama extended in 2010 — pushed them far below where they would have been if we had stuck to Clinton’s rates. The other is that recessions bring revenue down and spending up, and we’re just coming out of a deep, long recession. And that’s fine. This isn’t a popular thing to say, but there are times when it’s good to have a deficit. Now, for instance. When businesses and consumers stop borrowing and stop spending, government needs to borrow to pick up the slack and protect the vulnerable. But the flip side of that is we shouldn’t have been running deficits during the growth years that preceded the financial crisis, and we need to get them under control once the economy has recovered. And the two parties are proposing very different ways of doing that. Comparing the fiscal promises made by Obama and Mitt Romney isn’t quite comparing apples to apples. Obama is burdened with the responsibilities of governance. His numbers need to add up. They need to unite the congressional wing of his party. They need to fit inside a detailed budget that lays out funding levels for every agency in the federal government. Romney, meanwhile, is running a primary campaign. He’s trying to keep Newt Gingrich and Rick Santorum from getting too far to his right. He’s trying to mollify conservatives. He’s trying to inspire the party faithful. So his promises — like those of all candidates, including Obama in 2008 — are going to be a bit more fantastic than those of the sitting president. Nevertheless, the difference between the tax proposals of the two candidates is instructive. First, it’s important to establish our baseline: If we just extend our current policies — which would mean extending the Bush tax cuts — revenues will be 17.9 percent of GDP over the next decade. Obama’s plan would raise revenues to 19.2 percent of GDP. Most of that would come from people making more than $250,000 a year. Back in September, the nonpartisan Tax Policy Center ran the numbers on his proposal — which is unchanged in the budget — and they estimated that taxpayers in the bottom 20 percent would pay an average federal tax rate of 1.8 percent, those in the middle 20 percent would pay 15.2 percent, and the top 1 percent would pay 36.3 percent. Romney’s plan cuts taxes to about 17 percent of GDP. Most of those cuts would accrue to upper-income Americans. According to the Tax Policy Center, under Romney’s plan, taxpayers in the bottom 20 percent would pay a rate of 3.4 percent, those in the middle 20 percent would pay a rate of 15.6 percent, and the top 1 percent would pay 25.9 percent. So low- and middle-income families would pay a bit more under Romney’s tax plan, but high-income families would pay a lot less. Taxes would also fall far short of spending. A realistic estimate of federal spending over the next decade is in the 22-23 percent of GDP range. Romney’s revenues are five to six points below that, and because Romney has promised to balance the budget without cutting defense spending, he would have to cut every domestic spending program, including Social Security and Medicare, by more than 35 percent to make his numbers work. But there is agreement here, too. Taxes are lower under both plans than they would be if we simply let the Bush tax cuts expire and returned to Clinton-era rates. Then, taxes would be closer to 20.4 percent of GDP. You wouldn’t know that from the admiration with which Democrats talk about Clinton’s economic policies, or the horror with which Republicans talk about Obama’s tax ideas. They’re also lower in both plans than they were under the Simpson-Bowles proposal, which called for revenues at 20.3 percent of GDP, and the Gang of Six proposal, which envisioned revenues at 19.9 percent of GDP. But then, that’s why budgets are useful. They help us keep the two parties honest. http://www.washingtonpost.com/blogs/...35AR_blog.html

[Phillyrocket]

Is there some law that I am unaware of that to be a Republican you must support giving the largest share of the tax cuts to the rich and rail that "it's a spending problem" while refusing to cut defense spending?

[Batman Jones]

Originally Posted by Phillyrocket Is there some law that I am unaware of that to be a Republican you must support giving the largest share of the tax cuts to the rich and rail that "it's a spending problem" while refusing to cut defense spending?

Yes, there is. And they have to go on record with much crazier stuff than that if they want to be elected as Republicans.

[Deckard]

Thanks for that, FB, but good luck getting any of the far-right, fundamentalist mainliners here to condemn Romney's budget "plan," unless they're saying it doesn't go far enough. There seems to be no limit to the largess the rulers of the Republican Party are willing to give the wealthiest Americans, and their conjoined twin, Corporate America. Those in the Middle Class who support them can only be described as masochistic, and seemingly unaware of that fact. Bizarre.

[cml750]

Clicked the link and saw this was written by known ultra-liberal Ezra Klein then I stopped reading.

[GladiatoRowdy]

Originally Posted by cml750 Clicked the link and saw this was written by known ultra-liberal Ezra Klein then I stopped reading.

Can't address the substance so you discount it because of the source. Par for the course for your kind.

[bobrek]

Originally Posted by FranchiseBlade This is a cool article that compares Romney's budget and Obama's budget. Notice that Romney hikes taxes on the tax earners that make the least money, and cuts taxes drastically on the wealthiest of all Americans...

So, when he talks about tax rates, are these proposed tax rates comparable to what the IRS currently defines tax rates as? For example, the current 'low' tax rate is 10% and the 'high' is 35%. If that is the case, then Romney is significantly lowering the 'low' tax rate (albeit still higher than Obama).

Again, assuming that is the case, it looks like Romney is lowering the low tax rate a bit over 60% and lowering the high tax rate around 26%.

Is that correct, or am I misundertanding how the author is referring to tax rates?

[SamCassell]

Originally Posted by bobrek So, when he talks about tax rates, are these proposed tax rates comparable to what the IRS currently defines tax rates as? For example, the current 'low' tax rate is 10% and the 'high' is 35%. If that is the case, then Romney is significantly lowering the 'low' tax rate (albeit still higher than Obama). Again, assuming that is the case, it looks like Romney is lowering the low tax rate a bit over 60% and lowering the high tax rate around 26%. Is that correct, or am I misundertanding how the author is referring to tax rates?

I believe the word rate is being used here as "actual percentage of income paid to federal income tax", and not the "marginal rate" at which that taxpayer's top dollar made is taxed. In the case of the poor, their AGI is lowered greatly by the standard (or itemized) deductions, the personal exemption, dependent exemptions, etc. Those reductions result in a much greater percentage savings to someone earning , say, $15 thousand than to someone who earns $200 thousand.

[bobrek]

Originally Posted by SamCassell I believe the word rate is being used here as "actual percentage of income paid to federal income tax", and not the "marginal rate" at which that taxpayer's top dollar made is taxed. In the case of the poor, their AGI is lowered greatly by the standard (or itemized) deductions, the personal exemption, dependent exemptions, etc. Those reductions result in a much greater percentage savings to someone earning , say, $15 thousand than to someone who earns $200 thousand.

If that is the case, do you have any idea what the current numbers are? Based on IRS data (as of 2009), it looks like the top 10% pay an average tax rate of 18% of their AGI (top 1% around 24%) while the bottom 50% (I don't see any data with more detail than that) paid around 1.85%.

[SamFisher]

Originally Posted by bobrek If that is the case, do you have any idea what the current numbers are? Based on IRS data (as of 2009), it looks like the top 10% pay an average tax rate of 18% of their AGI (top 1% around 24%) while the bottom 50% (I don't see any data with more detail than that) paid around 1.85%.

Not even remotely true, but don't stop believing.

[juicystream]

Originally Posted by SamFisher Not even remotely true, but don't stop believing.

Because IRS data lies?

[FranchiseBlade]

Originally Posted by cml750 Clicked the link and saw this was written by known ultra-liberal Ezra Klein then I stopped reading.

Yes, it's best to ignore FACTS if those facts come from the pen of a liberal. A liberal who is a credible journalist and working for a credible newspaper.

It's better to get your facts from places like fox news that shows an unemployment graph which puts 8.6 % unemployment at higher than 8.8 and 8.9 in an effort to make Obama's record look worse.

http://mediamatters.org/blog/201112120005

[bobrek]

Originally Posted by SamFisher Not even remotely true, but don't stop believing.

Look, I am asking questions and trying to find out more information. I got those numbers from here:

http://www.taxfoundation.org/news/show/250.html

Do you have anything worthwhile to add to the discussion or "true" information to point me to?

[SamFisher]

Originally Posted by bobrek Look, I am asking questions and trying to find out more information. I got those numbers from here: http://www.taxfoundation.org/news/show/250.html Do you have anything worthwhile to add to the discussion or "true" information to point me to?

I can tell you that your statement is openly and obviously wrong and distortionary by just reading it, because you're using the oldest most cliched trick in the book. Maybe you should start there in your quest for truth, brah.

[bobrek]

Originally Posted by SamFisher I can tell you that your statement is openly and obviously wrong and distortionary by just reading it, because you're using the oldest most cliched trick in the book. Maybe you should start there in your quest for truth, brah.

I am simply trying to find out what the current numbers are so I can see how they compare to the numbers Romney and Obama are proposing. Isn't that the point of discussion? If the numbers I am finding are incorrect, I would appreciate it if someone would point me to the correct current numbers.

Based on the numbers in the author's article, there is no question that Romney's budget is more favorable towards the wealthy X percent than Obama's.

In my original post, I clearly stated I was assuming and asked if it was correct or if I was misunderstanding the author's use of tax rate. When SamCassell politely responded, I went looking further and found what again, I assumed were comparable numbers. My subsequent post started "If that is the case" and included the phrase "It looks like".

I am not stating anything as fact, simply stating what I have found and WELCOMING any and all pertinent pointers to data that I should be comparing the author's numbers to.

[DonnyMost]

Supply side economics; maybe it will work the 6th time around!

[justtxyank]

Originally Posted by GladiatoRowdy Can't address the substance so you discount it because of the source. Par for the course for your kind.

Please. Par for the course for this board.

The liberals on this board immediately dismiss threads started by certain users and articles by certain authors or certain websites or news stations. The conservatives do it right back. And then both sides complain about the other side doing it.

Guess what? The BBS is more reflective of Congress than they think!

[FranchiseBlade]

Originally Posted by justtxyank Please. Par for the course for this board. The liberals on this board immediately dismiss threads started by certain users and articles by certain authors or certain websites or news stations. The conservatives do it right back. And then both sides complain about the other side doing it. Guess what? The BBS is more reflective of Congress than they think!

No, not really. Threads and posts by posters being ignored on either side is fine. Those are people who may not be interested in really discussing events and are paid to be here, or just don't provide any meaningful feedback. They should be ignored.

But writers and news channels should be looked at with a skeptical eye on both sides, but not ignoring facts if they are presented.

[justtxyank]

Originally Posted by bobrek I am simply trying to find out what the current numbers are so I can see how they compare to the numbers Romney and Obama are proposing. Isn't that the point of discussion? If the numbers I am finding are incorrect, I would appreciate it if someone would point me to the correct current numbers. Based on the numbers in the author's article, there is no question that Romney's budget is more favorable towards the wealthy X percent than Obama's. In my original post, I clearly stated I was assuming and asked if it was correct or if I was misunderstanding the author's use of tax rate. When SamCassell politely responded, I went looking further and found what again, I assumed were comparable numbers. My subsequent post started "If that is the case" and included the phrase "It looks like". I am not stating anything as fact, simply stating what I have found and WELCOMING any and all pertinent pointers to data that I should be comparing the author's numbers to.

Come on Bob, you've been here long enough. Sam's schtick isn't to have good discussion, it's to act like an arrogant donkey and take shots at people with that condescending elitist tone. It makes better conversation and is better for actual learning to just ignore him and focus on the other posters.

[justtxyank]

Originally Posted by FranchiseBlade No, not really.

?

You don't agree that both sides here dismiss articles written by people they don't like? Please do a search Franchise and you will find people on both sides of the political article using the "attack the source, ignore the material" argument in threads. Article gets posted and it gets followed with "An article by _________? Really?" or "Yeah I'm going to read an article from _________.com and take it seriously!" and then the other side says "Typical _________. Can't dispute the information so you attack the source. __________s."