More on Romney finance and GWBush connections

Posted on October 9, 2012 by Margie Burns

Ties with Team Bush part 2

Continuing previous posts

This seems like as good a time as any to follow up on previous post on Mitt Romney’s non-released tax information and Romney’s quiet, long-time, scantly reported but extensive ties to the George W. Bush team. For one thing, Bush recently announced that he will be visiting the Caymans just before the election.

Bush to address tanned investors

Amidst the hubbub on the front lines and the day-to-day movements of polls, Romney has succeeded in remaining closeted about his finances. It’s one thing he has been consistent about. It is safe to say that Romney has achieved the distinction of being by far the most secretive of any major-party candidate running seriously, if that’s the word, for high office. Richard Lardner reported back in February that Romney did not release names of his bundlers even after President Obama did so. As we know, the pattern extends to Romney’s tax returns–with the exception of partial returns for two recent years–and of course to the para-political organizations including ‘super PACs’ supporting Romney and the GOP even while capital stays on the sidelines when it comes to investing in business. (So much for GOP talk about ‘small business’.) Thus one of the wealthiest men in America, a long-time politician with extensive financial and political connections to the wealthiest members of the GOP in the finance and communication sectors across the country, can run for the White House without ever being called to account on his own financial track record.

Imagine what they'd say if this pic had Obama in it

Up top, let me say that this situation would be destructive even if Romney had established his track record in something other than his peculiar line of finance. The lack of transparency and accountability would be destructive even if Romney had been engaged in manufacturing, like his father, instead of in short-term paper losses to enlarge long-term gains, largely at other people’s expense. But it does not help that Romney’s track record includes so much gain for him, pain for others.

Romney to Detroit

Today’s history lesson

Remember one of Romney’s successful turnarounds in the 1990s, his temp work returning from Bain Capital to Bain & Co.? That turnaround came partly at the expense of the then-Bank of New England and partly at the expense of American taxpayers.

Bank of New England had already gone bankrupt following its dealings with Bain & Co., where Romney worked before forming Bain Capital with several colleagues (including T. Coleman Andrews III of a close Bush-connected family). Bain & Co. had lapsed on covenants with Bank of New England. But notwithstanding that the company had contributed to the bank’s failing, Romney’s work at Bain & Co. included getting Bain’s debt to Bank of New England reduced from $38 million to $28 million.

FDIC

Bank of New England, in Chapter 7, had already been seized by the Federal Deposit Insurance Commission (FDIC). The failure of the bank and its sister banks is the sixth largest bank failure in U.S. history, thus far. From Investopedia:

“At the time, the BNE was the 33rd largest bank in the U.S., and including its sister banks, it had assets totaling $21.8 billion and deposits totaling $19 billion. As with most bank failures, a bad loan portfolio triggered BNE’s downfall.”

The bank’s bad portolio included Bain. Thus what Romney’s negotiating means, in plain English, is that Romney succeeded in getting Bain’s bill to the American taxpayer reduced by $10 million. Romney’s negotiating tactic was as simple as it was unsavory. Bain & Co. at the time was in dire financial straits–explaining why Romney was brought back on board. Romney turned the minuses into pluses, using them as leverage against the FDIC: He threatened to use Bain’s remaining funds for bonuses to (end-stage) Bain executives.

Back to 2012

As written earlier, there are undoubtedly several reasons why Romney doesn’t want to release his tax returns–or any financial records, except the partial recent tax returns from two presidential-campaign years. One is that open records would clarify the close ties between the Bush and Romney teams over the years. Even a quick look at Romney’s business career shows that Romney’s interests have been tied closely to Bush’s. Previous posts dealt with entities including CaterAir–the Marriott spin-off that pretty gave Dubya his business career–and World Corp, South African Airways, and InteliData, where business relationships between the Bush people and the Romney-Bain people proliferated. Predictably given its Marriott ties, CaterAir has retained ties with Bain Capital over the years. See for examples corporate bios for Bain alumni from an SEC filing. One is an alumna of CaterAir, Graham a co-founder of Bain. This filing dates from the 2005 merger of InteliData and Corillian Corporation. InteliData, with Bain alum John Backus on board, became Coriallian; Corillian bought CheckFree, now FISERV.

Two candidates

To reiterate, in narrow political terms it does not benefit the Romney campaign to be tied too closely to the Bush years. It is beside the point that some recent polls have suggested that Romney is more of a drag on Bush than the other way around; during the past four years leading up to election 2012, the smart money would have seen it the other way around. Clearly the Romney campaign did. Team Romney has been working with GWBush alumni quietly, behind the scenes (as in the machinations in Virginia). By and large, the Bush and Cheney clans have not co-appeared out on the campaign trail with Romney and Ryan. Nor have the disgraced neo-cons left over from the Bush administration, who have nowhere else to go–and have flocked to Romney.

Candidate Romney on YouTube

Posted on October 5, 2012 by Margie Burns

YouTube, we are here

Some 2012 unforgettable Romney YouTube moments

We may live in an age of information overload. But overload or no, surely the string of special moments loosed like chemical by-products by the Romney campaign will not soon be forgotten.

Just for fun, if nothing else–here they are, courtesy of YouTube, with slight annotation.

Hearing Romney out on the campaign trail, one sees why he has spent so much time touring mainly among fundraisers. Anyway, here he is, introducing running mate Paul Ryan as the next president: http://www.youtube.com/watch?v=th93Kko9ySE

Romney with Ryan

Uncle Sigmund, call your office. Of course, everyone makes the occasional slip of the tongue. Here’s one where Romney tries unsuccessfully to accuse Obama of raising taxes:

http://www.youtube.com/watch?v=EAYz6ilQ6aU&feature=relmfu

He keeps having problems with Ryan, too. Here’s the one where Romney tries to get a crowd to chant his name along with Ryan’s. It makes even Joe Scarborough cringe: http://www.youtube.com/watch?v=SclDiN-lcYE

Then there are the deeper problems than tongue-twisting, like when he gets caught out in a misstatement. Here is Romney on money in politics, and on not hiring lobbyists:

http://www.youtube.com/watch?v=W_pgfWK3sxw&feature=related

Romney advisor Ron Kaufman

Some of the same moments again, in a flat-footed misstatement on his lobbyist-strategist (Ron Kaufman):

http://www.youtube.com/watch?v=kVA2Tr_GTlk&feature=related

Out on the campaign trail in New Hampshire, Romney puts his foot in it with a gay Viet vet:

http://www.youtube.com/watch?v=_H9FKfECKDk&feature=related

In related vein–Romney, queried for comment when a gay soldier is booed, waffles:

http://www.youtube.com/watch?v=ZU5-2rdAfG8&feature=related

Equally sensitive, here is Mitt “I don’t think I’ve ever hired an illegal in my life” Romney:

http://www.youtube.com/watch?v=OpD8yb5JR7Y

Perry, Romney

I envy Rick Perry. He brought out the best in Romney, in a sense. Here’s the $10K bet moment:

http://www.youtube.com/watch?v=uTpgTKAL_4k

To be fair, there’s also an embarrassment of riches when Perry tries to get Romney on flip-flopping. His heart’s in the right place, tongue not so much:

http://www.youtube.com/watch?v=47kZofrFwQ0

But if you wanted Romney clarified, the go-to guy is his own strategist. The strategy? Etch-a-Sketch:

http://www.youtube.com/watch?v=X6NArPUFLRI

Simple greatness. Even Newt Gingrich and Rick Santorum fielded that one:

http://www.youtube.com/watch?v=qlhmzzfU8G4

http://www.youtube.com/watch?v=3fvQbQysfdU&feature=related

Building on the great Etch-a-Sketch reveal, human history gets the infamous “47%” video:

http://www.youtube.com/watch?v=XnB0NZzl5HA

Romney attempted to explain away his “47%” comments the night they were revealed:

http://www.youtube.com/watch?v=mhfmvuPHkZI

But move over, Mother Jones. Nobody beat up on Romney as well as Ron Paul’s people. Take this segment on the size of Romney’s typical audiences on the campaign trail:

http://www.youtube.com/watch?v=3GkR4dIHKKE&feature=related

Romney event

Romney’s own take on why he stumbled so many times in the campaign? “I think it’s about envy”:

http://www.youtube.com/watch?v=qudG6xS1M5o

As Romney reminds us, “those people who’ve been most successful will be in the one percent.”

But charitably overlooking the man’s immense wealth gets a little hard when the candidate himself single-handedly produces a whole album of out-of-touch moments. Here are the top ten:

http://www.youtube.com/watch?v=lFUUDrh9wNg&feature=related

Compilations of Romney gaffes are fun, and convenient. Here, a trio:

http://www.youtube.com/watch?v=ZIjcF4DgFy8

http://www.youtube.com/watch?v=cU0MVdq_ioQ

http://www.youtube.com/watch?v=SH–Y0ZjBS0&feature=relmfu

And to wind up, here is a nice compilation of Romney misstatements about the Obama administration, with video rebuttal:

http://www.youtube.com/watch?annotation_id=annotation_925350&feature=iv&src_vid=EQwrB1vu74c&v=Bg6S1HOo0j8

Enjoy your weekend–and remember where it came from, the not-Romneys of the world.

Debating against an Etch-A-Sketch

Posted on October 4, 2012 by Margie Burns

Debating against an Etch-A-Sketch

How could cutting federal programs and cutting taxes ‘grow the economy’?

It was Gov. Mitt Romney who said, last night, that he would not reduce taxes for high-income individuals. It was Romney who said, “I’m not looking for a $5 trillion tax cut.” Romney repeatedly said he does not favor a tax cut for the rich. It was Romney who first said, “We have to have regulation” in the financial sector, adding that we can’t have people opening up a bank in their garage. Romney said, “I’m not going to cut education funding.” It was Romney who repeated–shades of George H. W. Bush’s “read my lips”–that he would not, underscore not, pursue any tax cut that raises the deficit. Romney’s own words: “My plan is not to put in place any tax cut that will add to the deficit.”

Romney, before first debate

Let’s set aside for a moment any questions about the truth content of the statements. The immediate observation for me last night–watching the televised debate, with estimable moderator Jim Lehrer, on C-Span–was Romney’s acute defensiveness.

He’s right to be defensive, of course. Romney and Paul Ryan, his running mate, have between them produced hundreds of utterances exactly the reverse of the foregoing. A quick run-down, quickly pulled off the top from a mountain of examples:

Ryan’s tax plan as originally published supports eliminating the capital gains tax entirely–along with all taxes on interest, dividends, and inheritance
Romney’s own tax plan, updated under fire, retains the George W. Bush tax cuts for the wealthy
Romney’s tax plan additionally cuts individual income tax rates in yet-unspecified ways
Romney’s tax plan, like Ryan’s, also eliminates taxes on investment income, eliminates any taxes raising revenue in the health reform legislation, and eliminates the estate (inheritance) tax–a provision that benefits himself greatly
Romney and Ryan have both repeatedly proposed lowering the corporate income tax rate, claiming that U.S. corporations pay higher taxes even when news reports and other analysis show top companies paying no income tax in a given year
as to education, both Romney and Ryan want to repeal the American Opportunity tax credit for higher education
Romney’s tax plan calls for repealing the refundability of the child tax credit and for repealing the expansion of the earned income tax credit (EITC)
in another sop to private companies making money off students and parents, Romney supports allowing students receiving federal aid, such as students with disabilities, to use their aid to pay for private schools (“school choice”)

Romney

The truth content of any statement by Romney on the campaign trail is up for grabs. The bigger the audience, the more up for grabs.

A reasoned assessment of candidate Romney’s statements as harbingers of future policy under a Romney-Ryan administration might note some of the things Romney did not say.

Although Romney said last night (defensively) that he would close loopholes in the tax code, as President Obama pointed out, Romney did not clarify what loopholes or deductions he might close. Romney implied that he would close loopholes or eliminate deductions that benefit the wealthy but did not say which.
Romney did not mention George W. Bush. Romney’s repeated assertion that he will not “cut” taxes for the wealthy leaves in place the previous cuts passed under the Bush administration.
Romney said that he would “replace” Dodd-Frank but did not say how he would replace the legislation or with what.
Romney did not mention congressional Republicans, by name or by specific policy. This was politic. Candidate Romney cannot castigate the president for ‘slow’ economic recovery from the worst economic event since the Great Depression, if people remember that everything the Obama administration has tried has been opposed by Sen. Mitch McConnell (R-Ky.), Rep. John Boehner (R-Ohio) and Rep. Eric Cantor (R-Va.).
Come to think of it, Romney did not mention by name any top Republicans now running for office or for reelection. He did not mention even his own running mate, Paul Ryan–also running for Congress–until the president mentioned him in connection with Ryan’s Medicare proposals. Possibly Romney less than pleased with some of Ryan’s recent criticisms of his gaffes.

Ryan and Medicare

As said, more than a trifle defensive, and understandably so. By all accounts, Romney came into last night’s debate pretty much on his own–though he will benefit from the predictable spin by the right-wing echo chamber, always ready to scare the timorous. (A glance at headlines shows they’re already double-standarding the president on defensiveness.)

Diagram of weather vane

Back to the debate–before leaving this quick sketch of not-mentioned’s, one final item.

On reducing the deficit, candidate Romney said, “I have my own plan.”

From the transcript:

LEHRER: Governor, what about Simpson-Bowles? Do you support Simpson-Bowles?

ROMNEY: Simpson-Bowles, the president should have grabbed that.

LEHRER: No, I mean, do you support Simpson-Bowles?

ROMNEY: I have my own plan. It’s not the same as Simpson- Bowles. But in my view, the president should have grabbed it. If you wanted to make some adjustments to it, take it, go to Congress, fight for it.

OBAMA: That’s what we’ve done, made some adjustments to it, and we’re putting it forward before Congress right now, a $4 trillion plan . . .

ROMNEY: But you’ve been — but you’ve been president four years…

(CROSSTALK)

This is a perfect example of (some of) the most infuriating GOP tactics. It’s Romney’s kind of syllogism. One, the president should have supported Simpson-Bowles. Two, I am not supporting Simpson-Bowles and am not saying how I differ. Three, the president should have supported Simpson-Bowles.

No mention, no mention whatsoever, of congressional Republicans’ obstruction of every social and fiscal proposal for the last four years. No mention of their stated determination to keep Obama from doing anything to improve the economy or to reduce the deficit–since that would enhance his chances of reelection.

Mitch McConnell

It is a relief, in a sense, to turn from Romney’s omissions and outright lies to some moments of clarity. Here are a few:

Romney stated repeatedly that he will support “no tax cut that adds to the deficit.” He also referred repeatedly to balancing the budget. “My plan is not to put in place any tax cut that will add to the deficit. That’s point one.”

When Obama said, “Romney has ruled out revenue” in deficit reduction, and Lehrer asked Romney to respond to the statement, Romney agreed.

Romney repeatedly referred to shifting federal programs to the states. Romney stuck with the idea of turning even Medicaid over to states, even when Obama rightly criticized it.

Fifty fiscal cliffs?

Obviously, if you push the costs of federal programs on to the states by turning over federal programs to states, you–so to speak–reduce the federal deficit. You also produce a 50-state version of the fiscal cliff. I am hoping no sane person anywhere to the left of Louis XVI goes along with this. Romney’s idea, in case anyone missed it, amounts to turning health care over to the states, turning veterans’ benefits over to the states, turning Medicaid over to the states. Does anyone envision the state of Alabama, or South Carolina, getting insurance companies to provide actual health care coverage–either for poor people or for anyone else? How about the state legislatures of Tennessee or Kentucky? Have they made the insurance industry play ball? When? Are they provided with the laws-with-teeth it takes to exact sizable fines from large companies committing fraud, including insurance companies that defraud? Do they even have the resources to prosecute multi-state fraudsters?

On Medicare, another moment of clarity. From the transcript:

LEHRER: All right. Can we—can the two of you agree that the voters have a choice—a clear choice between the two . . .

ROMNEY: Absolutely.

LEHRER: . . . of you on Medicare?

ROMNEY: Absolutely.

OBAMA: Absolutely.

Explaining

Now to some clearer statements from Romney.

From the transcript:

“I don’t want to cost jobs. My priority is jobs. And so what I do is I bring down the tax rates, lower deductions and exemptions, the same idea behind Bowles-Simpson, by the way, get the rates down, lower deductions and exemptions, to create more jobs, because there’s nothing better for getting us to a balanced budget than having more people working, earning more money, paying more taxes. That’s by far the most effective and efficient way to get this budget balanced.”

From the transcript:

“So how do we deal with it? Well, mathematically, there are three ways that you can cut a deficit. One, of course, is to raise taxes. Number two is to cut spending. And number [three] is to grow the economy, because if more people work in a growing economy, they’re paying taxes, and you can get the job done that way.

The presidents would—president would prefer raising taxes. I understand. The problem with raising taxes is that it slows down the rate of growth. And you could never quite get the job done. I want to lower spending and encourage economic growth at the same time.

What things would I cut from spending? Well, first of all, I will eliminate all programs by this test, if they don’t pass it: Is the program so critical it’s worth borrowing money from China to pay for it? And if not, I’ll get rid of it. Obamacare’s on my list.”

For my money, this is the place to arrive, for anyone who wants to evaluate the somewhat slippery Romney’s vision for the future. The statements just quoted come as close as anything can to Romney’s core principles.

They also amount to a Get-out-of-jail-free card for candidate Romney. You see, it’s number [three], ‘growing the economy’, that works the magic. Growing the economy will produce jobs; more jobs will mean more taxes paid by working people–we just recently heard Veep nominee and congressional candidate Ryan expressing concern about that; and more taxes from working people will mean reducing the deficit.

And how will Romney ‘grow the economy’? We’ve heard it before. He will cut taxes and cut federal programs.

This is the game plan. Forget repetitions of the potent word ‘jobs’. Forget touching anecdotes about a few individuals. Forget claims of supporting the middle class. Cutting taxes and cutting federal programs will grow the economy, and that will take care of all our other problems.

And what if it doesn’t work?

[Update]

Romney’s debate performance is spawning numerous fact-based rebuttals. This one from Daily Kos is representative.

[ ]

Financial sector finds money for rightwing speakers

Posted on October 3, 2012 by Margie Burns

Speaking of money, speaking for money, money for speech

Who said speech was free?

It is good to see the hard-hit and lovely city of New Orleans supported. The 2012 New Orleans Investment Conference, however, is a whole different ball game.

Speaker

The NOLA Conference bills itself as

Your Path To
Profits And Safety
During Global Chaos

It further bills self as a gathering of “The world’s greatest geopolitical, economic and investing experts,” who will “lead you to profits and safety during the dangerous days ahead.”

Who dat?

Who are these experts? Prominent mention goes to the geopolitical experts.

Tina Fey as Palin

Featured speakers:

Gov. Sarah Palin
Charles Krauthammer, rightwing commentator
Rick Santelli, billed as the founder of the Tea Party

There is also a lineup of finance experts in some veins. Promises include the following:

“At New Orleans 2012, Dr. [Marc] Faber will reveal the truth about global inflation and the commodities boom. Including which commodities will benefit — and which won’t!”

“And at New Orleans 2012, Mr. [Peter] Schiff will reveal why today’s environment is like the 1970s on steroids — and how you can invest for both fun and profit during the coming runaway global inflation!”

“Plus, you can stroll through a veritable bazaar filled with dozens of high-potential companies in our exhibit hall. Every year, some of the biggest winners in the precious metals and resource sector are found here before they take off.”

One notes in these fulsome blurbs the characteristics also found in gold-sellers on TV and on the back pages of magazines–an emphasis on volatile commodities, ditto on precious metals, apocalyptic rhetoric about the future economy, and lack of data.

It all happens this month–Oct. 24-27.

“In New Orleans, Gov. Palin will participate in our Summit on America’s Future panel with Charles Krauthammer and Rick Santelli, and give a rousing closing address. In the process, she will reveal the dire stakes in this year’s national election, and what you can do to prepare regardless of the outcome.”

The most influential commentator in America, for gold sellers

Hard to wait.

Mitt Romney’s tax policy, corporate taxes, and (almost) everybody else’s

Posted on October 2, 2012 by Margie Burns

Mitt Romney’s tax policy, corporate taxes, and (almost) everybody else’s

Following up on the last post, this time focusing on corporate rather than individual tax provisions–

As stated earlier ‘loophole’ is an elastic term, defined as well as anywhere by the free dictionary: “A way of escaping a difficulty, especially an omission or ambiguity in the wording of a contract or law that provides a means of evading compliance.” Broadly defined, tax loopholes are legal ways to escape paying taxes.

Simple question: What tax loopholes do large corporations benefit from most?

The answer is less quick than with the earlier post on loopholes for wealthy individuals and for individual tax returns. More tax loopholes and related tax devices are available to corporations than are available even to individuals of wealth. Corporations, after all, can bring more pressure to bear on legislatures and can push back more on regulatory agencies than even wealthy individuals can.

However, one quick answer up top is almost blinding in its simplicity: large corporations are allowed to declare ‘losses’ for tax purposes when they are over-all not suffering losses. Writing off costs is one thing. Cost, as we learned in high school economics, is the difference between gross (income/earnings) and net. Subtract your costs from your gross receipts, and you’ve got your profit. But writing off paper losses on bucketsful of money, on an over-all net gain for the company, is just avoiding taxes multiple times.

Shuffling income into and out of Ireland, and onto lovely islands, also helps large companies avoid taxes. In one of numerous examples, Bloomberg News reported in 2010 that Google cut its U.S. taxes by $3.1 billion over three years by moving money to Bermuda via Ireland and the Netherlands. Citing regulatory filings in six countries, the Bloomberg report estimates Google’s effective overseas tax rate at 2.4 percent. Google beat all its competitors at the game, a complicated but legal system of funneling money into and out of Irish subsidiaries and thence into known island tax havens. The maneuvers are so well known to tax accountants that they have their own comic-book gangster-style names–the ‘Double Irish’ and the ‘Dutch sandwich’.

It would be good to find out which corporate tax loopholes Mitt Romney would favor closing. Candidate Romney is fond of justifying lower taxes on capital gains by saying that that income has already been taxed, presumably meaning at the company level. It might be more accurate to say that the money being parked offshore, taxed at the lower capital gains rate, or otherwise tax-sheltered by wealthy individuals–company employees or former employees like Romney–is money that has already avoided taxation. (Romney has supported eliminating the capital gains tax altogether.)

In any case, Bloomberg cites an estimate that the United States Treasury loses $60 billion a year through these maneuvers. The key tactic here is known as “transfer pricing”, ” paper transactions among corporate subsidiaries that allow for allocating income to tax havens while attributing expenses to higher-tax countries.” Again, it would be good to know whether Romney favors eliminating transfer pricing for the purpose of allowing U.S. corporations to avoid U.S. taxes. Many of our candidates for office are fond of calling for simplifying and clarifying the tax code. Surely a more rational, more straightforward and clearer tax law would simply shut down the offshore tax havens–that is, simply disallow the claim of a post-office box and a brass plaque in the Caymans as a ‘subsidiary’, ‘branch’, ‘shell’ or any other (legal) division of a company for tax purposes.

Moving from Google to one of its chief competitors–

Reuters reported in 2011 that Microsoft reported only $445 million in taxes–U.S. and foreign–on $6.3 billion in profit, for fiscal fourth quarter. The way Microsoft worked this tax magic? Simple: “It is increasingly channeling earnings from sales to customers throughout the world through the low-tax havens of Ireland, Puerto Rico and Singapore.”

The tactic is deliberate; Microsoft increasingly has declared its earnings abroad, more and more, and in the U.S. less and less, over a period of years.

“The change is fueling its shrinking tax bills. According to its 2010 annual report, by keeping a good chunk of foreign earnings away from the U.S., Microsoft has accumulated $29.5 billion overseas–and that is before the impact of its last financial year.”

The non-profit USPIRG issued a report on tax havens this year. Keeping its recommendations short and sweet, the report urges, “Close corporate tax loopholes.”

Executive summary:

“Some U.S.-based multinational firms or individuals avoid paying U.S. taxes by transferring their earnings to tax haven countries with minimal or no taxes. These tax haven users benefit from their access to America’s markets, workforce, infrastructure and security; but they pay little or nothing for it—violating the basic fairness of the tax system and forcing other taxpayers to pick up the tab.

Even when tax haven abusers act perfectly legally, they force other Americans to shoulder the burden in a variety of ways. The taxes they don’t pay must be balanced by other Americans paying higher taxes, coping with cuts to public spending priorities, or increasing the federal debt.

Congressional studies conclude tax haven abuse costs the United States approximately $100 billion in tax revenues every year. Multinational corporations account for $60 billion and individuals the rest.” [emphasis in original]

Federal tax subsidies for corporations

Many of our worst candidates are also fond of talking about ‘entitlements’, usually referring to the supposed presumptuousness of the poor. The same candidates never mention corporate entitlements. As the non-profit Citizens for Tax Justice reported in 2011, more than half of all U.S. government subsidies go to only four industries—financial, utilities, telecommunications, and oil/gas/pipelines. From 2008 to 2010, 56 percent of all tax subsidies went to these four industries.

The sheer size of the subsidies is staggering. Wells Fargo topped the list with $17.9 billion in tax subsidies in 2008-2010 (p. 6, numbers given in millions). AT&T came in second with $14.5 billion in tax subsidies for the same period. Verizon third, GE fourth, IBM fifth, ExxonMobil sixth. Over-all, Citizens for Tax Justice studied earnings and taxes for 280 top companies and reported, “Tax subsidies for the 280 companies over the three years totaled a staggering $222.7 billion ($61.4 billion in 2008, $76.2 billion in 2009 and $85.1 billion in 2010).”

One result is that 37 top companies paid no federal income tax in 2010 (p. 18). These companies, be it noted, include major federal contractors such as GE and Boeing. In 2009, 49 top corporations paid no income tax, including Halliburton, Wells Fargo, GE and Verizon (p. 19). In 2008, 22 top corporations paid no income tax, including GE, Eli Lilly and Goldman Sachs (p. 20). Goldman, of course, suffered huge losses in the mortgage-derivatives debacle, and 2008 was a bad year.

2008 was not a bad year for the oil companies, however. This little-emphasized fact makes the extensive federal subsidies for Big Oil particularly galling. In Q3 2008, when everything else was hitting the fan, or about to hit the fan, ExxonMobil reported receiving the highest quarterly profit ever recorded by a U.S.company. As CNN reported at the time, “Exxon Mobil, (XOM, Fortune 500), the leadingU.S. oil company, said its third-quarter net profit was $14.83 billion, or $2.86 per share, up from $9.41 billion, or $1.70, a year earlier. That profit included $1.45 billion in special items.”

The company’s previous record had been the previous quarter. The $14 billion quarterly net came despite losses from Hurricane Ike and the Exxon Valdez oil spill.

“The company’s earnings were buoyed by oil prices, which reached record highs in the quarter before declining. Oil prices were trading at $140.97 a barrel at the beginning of the third quarter, and had fallen to $100.64 at the end.

“Compare that to 2007, when prices traded at $71.09 a barrel at the beginning of the third quarter, and rose to $81.66 by the end.”

Predictably, ExxonMobil continues to report record profits to the present day. The other oil majors are following suit.

Federal help for oil companies is quite the anomaly, to put it nicely.

Astronomical profits for Big Oil do not typically pass along to the consumer. As company profits have risen, the price of gasoline at the pump has not declined proportionately. When ExxonMobil profits increased more than $5 BILLION in one year–an increase of 35 percent from one year to the next–gas prices did not decline 35 percent in the same year. The average price of gasoline, according to Department of Energy (DOE) statistics, went down about 22 cents in the same period, a price decline of less than 8 percent. Profit up by 35 percent, gasoline down 8 percent–and that’s without factoring in the cost to the nation of the then-decline in U.S. automobile sales, the consequent unemployment and decline in company benefits, and pressures on home mortgages from high fuel prices. The people who profit most from Big Oil’s relaxed tax burden, by the way, tend also to be the people who opposed the Obama administration’s rescuing the auto industry.
Numerous reports have indicated by now that one of the big factors affecting the price of gasoline at the pump is not supply of crude oil, but speculation. Again, the same individuals and entities who opposed helping Detroit also oppose reining in speculation in commodities including fuel.
Meanwhile, every statistical record also indicates thatU.S.consumers are reining in demand, as Americans curtail trip-taking and errand-running and turn to more fuel-efficient vehicles where they at all can do so. Thus, whatever the ‘law of supply and demand’ might seem to dictate, it has not dictated that a combination of record profits for the oil companies, falling demand by consumers, and lower price of crude oil bring about a concomitant decline in prices at the pump.
What is said here about gasoline prices also pertains to the price of home heating fuel.

Any time the price of filling up the tank goes down–generally as a function of market vagaries including speculation–the decline tends to blunt public outrage over high fuel prices, overpaid CEOs, and astronomical oil company profits. However, public support for better use of energy resources including conservation measures, and public support for a windfall-profits tax for the oil companies, have trended upward.

Max Cleland

Unfortunately, this is one place we need real political leadership, and that takes courage. Former Sen. Max Cleland (D) of Georgia tried to bring about public awareness of high petroleum profits. Cleland even held a hearing on manipulation of prices in the transportation sector–a rarity in the Bush years, in Washington. Cleland’s reward? The petroleum industry poured record donations into the coffers of challenger Saxby Chambliss (R), who used some of the money on campaign ads linking Cleland–a decorated disabled Vietnam War vet–to Osama bin Laden.

Chambliss

It is useless to hope for improvement through, or from, the Republican Party. Republican candidates continue to campaign solemnly on promises to cut top tax rates, exhort their audiences to reduce the corporate tax rate, and talk about eliminating capital-gains and estate taxes. Herman Cain even wanted to substitute an across-the-board sales tax of 9 percent for progressive income tax rates. Their well-paid spokespersons in large media outlets—commentators like George Will and David Brooks—blamed the subprime mortgage debacle on poor people who bought bigger houses than they could afford. (Now they tend not to mention it.) The GOP heads in Congress, Boehner and McConnell, falsely characterize every regulation (safer mines, cleaner air) as ‘job-killing’. They also obstruct every effort to bring tax cheats to justice, or at least big-donor tax cheats, corporate as well as individual.

More potential questions for Mr. Romney as candidate. Perhaps tomorrow night’s televised debate will at least touch on some of these issues.

Romney’s taxes and (almost) everybody else’s

Posted on September 27, 2012 by Margie Burns

Which tax loopholes would Romney want to cut?

‘Loophole’ is an elastic term, defined adequately for now by the free dictionary:

“A way of escaping a difficulty, especially an omission or ambiguity in the wording of a contract or law that provides a means of evading compliance.”

Broadly defined, tax loopholes are legal ways to escape paying taxes.

Easy question: What tax loopholes right now do wealthiest individuals benefit from most?

Mortgage interest deduction

Quick answer:

Wealthy individuals receiving income from capital gains, including hedge fund managers, get their income taxed at the capital gains rate, i.e. a top rate of 15 percent. For some reason, buying and selling assets for money is not income the way working for money is. From a public policy standpoint, this means that some of the powers that be consider buying and selling assets more difficult than, say, laying a railroad. Or else they consider the former more socially productive–even after the mortgage-derivatives meltdown.

Capital gains tax and wealth

Bringing this tax issue swiftly down to the current presidential race, President Obama has supported changing this policy. There is effectively zero chance that GOP nominee Mitt Romney will support such a change. As previously written, Romney has used the capital gains advantage to great benefit in his own tax returns, and makes no bones about it. Romney’s 14 percent tax rate for 2011–voluntarily higher than it had to be, at that, and maybe temporary–has been widely reported.

Candidate Romney has been vague, to put it nicely, on what tax loopholes he would close. But this helpful article by one of the rightists at The New Republic provides a list of convenient targets. In all probability, a President Romney would look here first. First, note that almost all of these provisions–nine out of ten–benefit individuals rather than corporations (which are “people, my friends”). Furthermore, almost all of them benefit the middle class, people of ordinary wealth, income and assets.

Drum roll, please. Here are some of the top tax ‘loopholes’ in descending order of effectiveness, i.e. in taxes from the middle class lost, so to speak, to the Treasury. Reading each of these knots in the rope for the middle class, ask yourself one key question: Is there any realistic possibility that a President Romney and a Republican Congress would not target it for elimination? Note: If not, why not?

Employer contributions for employee health insurance/health care are excluded. Can you see a Romney-Ryan administration not trying to tax these?
The home mortgage interest deduction. The GOP platform coming out of the Republican National Convention left this one wide open.
Step-up basis of capital gains at death. With all the Republican hue and cry about inheritance taxes as a ‘death tax’, this one may be safe. Currently, capital gains on assets held at the owner’s death are not subject to capital gains tax, regardless of your income. The assets are valued at market on the date of death, again regardless of your income. Here, look out for state or county ‘recording fees’, and bank administrative fees, etc., that regressively burden a small inheritance more than a large estate. Not that one should be over-confident. Reps like Eric Cantor and Paul Ryan are entirely capable of finding additional federal ways to limit the benefit of the step-up for middle-income heirs.
401(k) plans. Really. Seriously. Can you imagine a Romney-Ryan administration boosting, leaving in place or in any way supporting private pension arrangements that might benefit a large number of middle-class workers or retirees?
Imputed rental income is excluded. Creates an advantage for owning over renting, thus creates an advantage for stability and greater economic security for middle-class voters. Is there a realistic chance that this one would not be a target?
State and local taxes are deducted. Romney himself benefited heftily from this deduction, according to his 2011 IRS filing.
Accelerated depreciation of machinery and equipment. Can benefit most the business persons who need it most. See the bull’s-eye?
Capital gains. Well, there’s one in every bunch.
Deduction for charitable contributions. They’ve already started going after this one, so they can hardly claim they won’t be trying further. Admittedly many wealthy individuals benefit from this deduction–but so do the causes to which they donate, including House of Ruth, Disabled Veterans of America, and countless food banks.
Exclusions for employer contributions to employee pension plans. See the first and fourth items, above.

The TNR author has a valid point that many, many dollars in tax ‘loopholes’ benefit individuals in the big middle of the U.S. economy. Another way of looking at the same topic–rather than suggesting 90 percent of the population as a giant larder to be raided by the one-percenters–would see most of these exclusions and deductions as reasonable ways to shore up individuals throughout all ranks of society. Thus it would seem to be a key question for campaign 2012: Which tax loopholes, Governor Romney, would you close? Maybe that question will be asked in one of the debates. It has not been effectively posed by the national political press so far, at least not effectively enough to get a clear answer.

Meanwhile, along with the big-ticket items above that allow the middle class to survive, there are some intriguing smaller items benefiting a far smaller cohort.

See for example this piece from Andrew Sorkin, from 2011. As the author points out, an oddity of the tax code benefits day traders and speculators who buy and sell futures contracts–even in comparison with traders in stocks or mutual funds.

“For years, futures contracts, which are essentially bets on the price of commodities, stock indexes and the like, have received a more favorable tax treatment than stocks. A trader who buys and sells an oil contract in less than a year—even in a matter of minutes—pays no more than a 23 percent tax on the profits.

Compare that with the bill for flipping shares of Google, General Electric or even a diversified mutual fund in the same time period. Those short-term investment gains are treated like ordinary income, meaning the rate can run as high as 35 percent.”

The biggest beneficiaries, Sorkin continues, “seem to be day traders and speculators. Long-term investors account for only 20 percent of the activity in the commodities future market, according to a report published last week by the Commodity Futures Trading Commission, the industry regulator.”

Incidentally, the fact that short-term gains can be taxed at a higher rate also means that a short-term (paper) loss can be a significant write-off. As previously written, Mitt Romney has taken full advantage of this one, too.

More in the Romney tax returns

Posted on September 25, 2012 by Margie Burns

Romney trusts receive more from govt for 2011 than Romney is paying in income tax

Posted on September 24, 2012 by Margie Burns

Romney trusts receive more from govt for 2011 than Romney is paying in income tax

What was that about receiving money from the government, again?

Re-posting from Saturday, responding to a couple of quick questions and further clarifying the earlier post–

Friday p.m., Sept. 21, Mitt Romney finally released his completed tax return for 2011. Finished Monday, released Friday afternoon, in one of those document drops traditionally timed for the start of the weekend rather than for the top of the news cycle.

The filing is dated Sept. 17, 2012, right after–first business day after–public release by Mother Jones magazine of Romney’s videotaped remarks. The three blind trust filings, however, were signed Sept. 12. Safe to say the Romney team waited until after the conventions to finish the tax papers, but the timing of the release may well have been planned before the Mother Jones videotape.

Mitt Romney

For now, a quick note on the Romney trusts.

First, the W. Mitt Romney Blind Trust return for 2011 shows income for Romney’s blind trust of $664,045 from the U.S. government. Top line, after you get through the pages for extensions, etc., is income from

U.S. GOVERNMENT INTEREST: $652,018.

Shortly after that comes U.S. GOVERNMENT INTEREST REPORTED AS DIVIDENDS: $12,027.

Total for 2011: as stated $664,045.

This is interest income alone in 2011, for Romney’s blind trust, from the United States government.

U.S. savings bonds

The same story holds for the other Romney trusts.

The 2011 return for the Romney Family Trust shows

U.S. government interest income: $662,115.

U.S. government interest in dividend form: $90,461.

Total U.S. government interest income for the Romney family trust: $752,576.

The 2011 return for the Ann Romney Trust shows

U.S. government interest income: $362,701.

U.S. government interest reported as dividends: $156,157.

Total: $518,858.

So total moneys received as interest, from our U.S. government in 2011, by the Romney trusts, came to $1,935,479.

A snarky person might call that the exact amount–in this category, for 2011–added by Romney trusts to the ‘national debt’ our GOPers gripe about so much.

I don’t feel that way, of course. I favor buying U.S. savings bonds. A few qualifiers, here:

One, as written previously I support buying U.S. Treasury notes, bills, and savings bonds. With interest rates low, it is a particularly patriotic thing to do, and that so many people and business entities around the globe are doing so is further evidence of the solidity of the U.S. government. Low-yielding savings bonds are a fiscally conservative form of investment and a safe place to park money.

Romney’s tax returns do not indicate when Romney or his trusts purchased the Treasury products producing this trust interest income.

Two, this interest income, handsome as it is, is dwarfed by the myriad tax write-offs allowed by our government to entities like Romney’s trusts, by the pages of paper losses and deductions Romney can legally use to reduce his taxes, and above all by the lower federal tax rate applied to income gotten by capital gains rather than by working.

But wait, there’s more. The next Q is how the blind trust returns relate to Romney’s tax return.

The Romneys’ tax return shows total adjusted gross income: $13,696,951.

Largest single income source: capital gains: $6,810,176.

Next largest income source: dividends: $3,649,567.

Next largest income source: interest: $3,012,775.

One answer is that the Romneys’ federal interest income comes to one-seventh, or 14 percent, of the adjusted gross income declared on Romney’s IRS return for 2011. Much has been made of that percentage in the 2012 election campaign, as we recall. Saturday’s Washington Post headline on this topic said that Romney paid a 14 percent tax rate in 2011. The WP did not mention that Romney’s income tax burden was almost exactly offset by interest income the Romney trusts received from the U.S. Treasury.

Looking at the same thing another way, without the interest income from Treasury, the Romneys’ adjusted gross comes down to $11,239,472. Admittedly that total would still be enough for their simple needs.

It might also be noted, though, that the income reported is just the interest on those U.S. government products. The face value of the Treasury bonds, notes or bills does not have to be reported, and isn’t. Nor is the purchase date or the type of Treasury product purchased. It’s just money coming back into Romney accounts–the full maturity value of the EE-Series bonds or whatever, which would be a multiple of the reported interest income.

Moving from percentages to dollar amounts, Romney reports owing $1,935,708.00 in federal income tax for 2011. He reports paying $3,434,441. That’s an overpayment with refund due to Romney, according to his return, of $1,498,740. (Box checked applying it to estimated tax for 2012.)

Thus,

to the government: $1,935,708.00

from the government: $1,935,479.00

Difference: $229.00

In short, by some uncanny coincidence Romney’s combined trusts received in interest FROM Uncle Sam, for 2011, almost exactly what citizen Romney is paying in income tax TO Uncle Sam for 2011.

And as stated that’s before factoring in all the offsets, credits, deductions and other means of reducing reportable or taxable income on the family IRS returns.

Romney’s releases re finance are posted here.

Romney trusts receive more from govt for 2011 than Romney is paying in income tax

Posted on September 22, 2012 by Margie Burns

Romney trusts receive more from govt for 2011 than Romney is paying in income tax

What was that about receiving money from the government, again?

Mitt Romney

Friday p.m., September 21, Mitt Romney finally released his completed tax return for 2011.

The date on the filing is 9-17-2012. Thus it was finished right after–first business day after–public release by Mother Jones magazine of Romney’s videotaped remarks about people who don’t pay taxes and want government handouts.

Finished Monday, released Friday afternoon, in one of those document drops traditionally timed for the start of the weekend rather than for the start of the news cycle.

More on the Romneys’ return itself later. The short story is that, for all the complaining Romney’s wealthy supporters do about how much government helps the poor, our government helps the rich more, far more. But as said, later for that.

For now, just a quick note on the Romney trusts.

First, the W. Mitt Romney Blind Trust return for 2011 shows income for Romney’s blind trust of $664,045 from the U.S. government. Top line, after you get through the pages for extensions, etc., is

income from U.S. GOVERNMENT INTEREST: $652,018.

Shortly after that comes U.S. GOVERNMENT INTEREST REPORTED AS DIVIDENDS: $12,027.

Total as stated $664,045, in interest income alone in 2011, for Romney’s blind trust from our gummint.

The same story holds for the other Romney trusts.

The 2011 return for the Romney Family Trust shows

U.S. government interest income at $662,115;

U.S. government interest in dividend form at $90,461.

Total U.S. government interest income for the Romney family trust: $752,576.

The 2011 return for the Ann Romney Trust shows usgov interest income of $362,701. U.S. government interest reported as dividends: $156,157. Total $518,858.

So total moneys received just as interest, from our U.S. government in 2011, by the Romney trusts, came to $1,935,479.

A snarky person might call that the exact amount contributed by Romney trusts to the ‘national debt’ our GOPers gripe about so much. Or anyway the exact amount so far as we know, for 2011.

A few qualifiers, here:

One, as written previously I support buying U.S. Treasury notes, bills, and savings bonds. With interest rates so low right now, it is a particularly patriotic thing to do, and that so many people and business entities around the globe are doing so is further evidence of the solidity of U.S. government reserves. Low-yielding savings bonds are a fiscally conservative form of investment and a safe place to park money.

(Romney’s tax returns do not indicate, so far as I can tell, when Romney or his trusts purchased the Treasury products producing this U.S. government interest income.)

But wait, there’s more.

Romney reports owing $1,935,708.00 in federal income tax for 2011. He reports paying $3,434,441. That’s an overpayment with refund due to Romney, according to his return, of $1,498,740. (He checked the box applying it to estimated tax for 2012.)

Thus,

to the government: $1,935,708.00

from the government: $1,935,479.00

Difference: $229.00

In short, by some uncanny coincidence Romney’s combined trusts received just very slightly less FROM Uncle Sam, for 2011, than citizen Romney is paying in income tax TO Uncle Sam.

Romney: “These are people who pay no income tax”

Posted on September 20, 2012 by Margie Burns

Romney: “These are people who pay no income tax”

Where did this Mitt Romney come from?

Let’s be clear, up top. Romney’s remarks at a Boca Raton fundraiser did not just link unworthy people, Obama voters, and the number ’47 percent’. Romney linked unworthy people, Obama voters, ’47 percent’, and “people who pay no income tax.”

Romney anti-tax button

Who spoke those words?

Why, Mitt Romney, the GOP nominee for the White House:

“There are 47% of the people who will vote for the president no matter what. All right, there are 47% who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That that’s an entitlement … And they will vote for this president no matter what … These are people who pay no income tax … My job is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.”

Did Romney miss his entire campaign over the past two years? Since when did he of all people equate paying federal income tax with personal responsibility?

(Note: I do, to some extent. Not he.)

Watching the tape, I found the casual they-pay-no-income-tax comment more jaw-dropping than the rest. (Had Romney just learned that he had to write a check to the IRS for 2011?) The candidate’s unbecoming dismissal of half the population is hardly news–aside from its exposure–nor is his dismissal of peace in the Middle East. This is basically the corporate GOP mindset. These are the same people, after all, who have abortions in their own families if they so choose but who are perfectly willing to subscribe to party platforms illegalizing the procedure if it will help them consolidate policy on matters dearer to them. That those policies do not benefit the overwhelming majority of the population is a point about which most GOP officeholders, or future lobbyists, have repeatedly shown themselves to be indifferent.

But elevating paying your income tax to a moral standard?

Who is this man?

Bob Hope must be spinning in his grave.

Retreating to common sense–it is a truism that no one likes to pay taxes. That’s one reason why this country, with its ideal of widespread literacy, still relies so heavily on ‘hidden’ taxes that are destructively recessive, such as sales taxes and ‘user fees’, etc. No one likes to pay income tax, although some people are patriotically proud of how much they contribute. Anti-IRS jokes have been a staple of a certain kind of humor at least since Bob Hope. Hope’s delivery and diction tended to be mild-mannered, not Tabasco, but could not have been confused with pro-tax. Like Romney’s candidacy early on, they went over well with the white-shoes-white-belt crowd that are Romney’s traditional base.

bleahh

Romney himself has acknowledged a lack of fondness for taxes. To do him justice, Romney has said openly–even on the campaign trail–that he himself uses every available mechanism to reduce his taxes:

“ROMNEY: Let me also say categorically, I have paid taxes every year, and a lot of taxes.

My view is I have paid all the taxes required by law. I don’t pay more than are legally due.”

More broadly, the notion that paying taxes is bad is hardly a subtext in this year’s Republican campaign.

The evidence on this point, in fact, gives new meaning to the old phrase ’embarrassment of riches’. See among numerous examples romney’s public remarks on Aug 24:

“In calling for a broader, simplified tax code, Republican presidential candidate Mitt Romney said Friday that bigger businesses, in knowing how to utilize loopholes in the tax code, are “doing fine in many places” compared to small businesses.

“We’ve got to make it easier for small businesses,” Romney told a crowd of about 300 people at a high-dollar fundraiser in Minnesota. “Big business is doing fine in many place- -they get the loans they need, they can deal with all the regulation. They know how to find ways to get through the tax code, save money by putting various things in the places where there are low tax havens around the world for their businesses. But small business is getting crushed.””

One looks in vain for criticism in Romney’s comments about big businesses not pulling their weight, feeling entitled, etc., in connection with paying no income tax. It’s no wonder the biggest guns in the GOP, especially some rightwing media personalities, are jumping all over Romney for all of a sudden getting religion about paying your income tax. I don’t remember the last time George Will, Charles Krauthammer or Bill Kristol stepped forward to support same.

Then we have Romney’s choice of a running mate, Paul Ryan (who is also running for Congress in Wisconsin, and has a strong challenger, Rob Zerban).

The Zerbans, Wisconsin

The same day that Romney made his “big businesses are doing fine” comment, Ryan said much the same thing:

“By plugging loopholes, which are uniquely enjoyed by higher income individuals, you’re reducing their ability to shelter their income from taxation . . .”

Needless to say, the Romney-Ryan campaign has not included specifics on what ‘loopholes’ would be cut ~~MORTGAGE INTEREST DEDUCTION~~. The Romney-Ryan insistence on extending all Bush tax cuts for the wealthiest, eliminating even the remaining U.S. inheritance tax, and lowering the income tax for corporations does not suggest that the loopholes would be only those enjoyed by the wealthiest among us ~~MORTGAGE INTEREST DEDUCTION~~.

To return to that “they pay no income tax” line–

The problem with Romney’s comments is not only that they were impolitic, inaccurate and mean-spirited. They were also confused. You cannot at one and the same time campaign against taxes, and elevate paying your fair share of taxes as a moral standard. You cannot openly acknowledge that the tax code already favors the wealthy and big businesses–as both Romney and Ryan have done–and then successfully claim that it’s the poorer citizens who are getting away with something.

Except when you’re talking privately to a cluster of wealthy individuals who already tell themselves that.

Orwell lives.

Speaking of impolitic remarks, there was a slideslip into accuracy in Romney’s “big businesses are doing fine” comments, which is one reason they were so widely quoted. Analyses, including this one by CNBC, have corroborated the finding that, indeed, the one percenters are doing fine using available tax breaks. The New York Times summarized some of the ways Aug. 10, the Journal Tribune Aug. 25. Plenty of further information is available.

Not that the one percenters are the only ones, of course. The question of who is not liable for federal income tax under the current tax code is now getting some clarification it has long deserved, thanks to Romney. Here among others is a good run-down by the Christian Science Monitor.

In fact, on why Romney’s conflating non-income-tax payers with 1) Obama voters and 2) unworthy people is as inaccurate as it is ugly, let’s take a leaf from Elizabeth Barrett Browning, and count the ways.

Non- federal income tax payers, by state percentages

Factor Number One: Region or State

The nonpartisan Tax Foundation published a report in 2010 showing that paying federal income tax varies widely by state. The ten states with the largest percentage of non-payers? They include nine states–Idaho, Texas, and southeastern states including Mississippi, Alabama, Georgia–likely to go for Romney. Of the ten, all but one–Florida–is conventionally designated a ‘red state’, and Florida has a Republican governor and legislature.

Factor Number Two: Age

Florida also has a sizable retired population. As this fuller breakdown by the Tax Policy Center reminds us, one cohort paying less federal income tax is the elderly. Senior citizens on Social Security benefit from tax expenditures that Romney and Ryan have claimed, on the campaign trail, to support. The oldest voters, be it noted, are the only age group of voters among whom Romney bests President Obama.

Factor Number Three: Low Income

The Center on Budget and Policy Priorities reports that the main reason people don’t pay federal income tax, when they don’t, is that their incomes are too low for them to be tax liable. Here Romney is on firmer ground, so to speak. True enough, many of the poorest households do not support him–except when they are also seniors, or Southern whites. A number of them, including households with elderly members or Southern whites, also receive Social Security Supplemental Security Income (SSI), disability aid, Medicaid, WIC, unemployment benefits or some other form of public assistance. So presumably a Romney-Ryan tax plan will try to catch more of the nation’s poorest households in a higher tax bracket. Those are the indications so far, both from Ryan himself and from the 2012 GOP platform.

Factor Number Four: Military Service

Federal income tax on compensation for serving in the military is offset in several ways. Compensation received for service in a combat zone, for example, is not subject to federal income tax. There are also state income-tax exclusions for military pay in various states. By the way, the states with the best exclusions are not necessarily red states. Cash-strapped red states are at least as likely as any other states to limit the income tax exclusions.

Factor Number Five: High-Net-Worth Individuals and Corporations

On not paying taxes at the upper end, you can find copious information in various glossy sources. A quick hint here, but really Romney and Ryan’s own comments–and the scant information so far released in Romney’s own tax returns–give the picture. If you want to have more fun, and enjoy scenic views of golden beaches and sun, you can read up on off-shore tax havens. And of course numerous top corporations make tax avoidance part of their ongoing strategy. They generally poor-mouth while doing it, too. Where are Romney and Ryan on these entities, perennially ready to portray themselves as victims?

Sad to say, some of the households and individuals characterized by Governor Romney as takers will vote for him anyway. Their local newspapers and television news channels may fail to clarify his remarks or to correct the tax arithmetic. Their willingness to believe it’s different when you accept government aid while simultaneously being white will undoubtedly be catered to by the campaign. That these are some of the same households hurt worst by Romney-Ryan policy won’t change their votes.

But the fact remains that the real one-way-streeters comprise those responsible for the mortgage-derivatives debacle, those who benefit financially from it, and those who oppose any process that would lead to retribution or reimbursement. Only racial politics could make the GOP imagine that any large proportion of the country can be made to forget who was responsible for our biggest crash since the Great Depression.

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