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Breaking Tax Code: Obama Jumps On Romney's Policy

Aug 2, 2012

Transcript

STEVE INSKEEP, HOST:

It's MORNING EDITION, from NPR News. I'm Steve Inskeep.

RENEE MONTAGNE, HOST:

And I'm Renee Montagne.

A damaging analysis has worked out the implications of Mitt Romney's plan to change the tax code. Romney says if elected, he would cut taxes, and do it in a way that does not expand the federal deficit.

INSKEEP: So some prominent tax experts asked what would happen if a plan like Romney's was revenue-neutral - that means that if one person's taxes go down, somebody else's would have to go up - and the Tax Policy Center said the Republican candidate would have to eliminate popular provisions that help middle-income Americans.

MONTAGNE: Which provided ammunition for President Obama, as he campaigned yesterday in Ohio. NPR's Ari Shapiro was there.

ARI SHAPIRO, BYLINE: Lots of candidates promise to cut taxes without saying how they'll pay for it. Mitt Romney also promises not to grow the deficit. So the authors of this study wanted to figure out where the money could come from. They started with the top of the tax code, getting rid of write-offs for the rich.

WILLIAM GALE: So then we started eliminating tax expenditures for progressively lower-income households until we raised enough revenue to pay for the tax cuts.

SHAPIRO: William Gale co-authored this study. He's part of the Tax Policy Center, a joint effort of the Brookings Institution and the Urban Institute. He says there's just no way to make the numbers work without hurting people in the middle.

GALE: And so the outcome then is that net taxes on middle-income households go up, while net taxes on high-income households fall.

SHAPIRO: Gale worked on the Council of Economic Advisors for the first President Bush. His co-author, Adam Looney, had a similar role in the Obama administration.

The Romney campaign argues that this Obama taint disqualifies the study as liberal. But during the Republican primaries, Romney's campaign treated the Tax Policy Center differently. When that group assessed Rick Perry's tax proposal, Romney put out a press release praising its nonpartisan, objective third-party analysis, all of which became fodder yesterday for President Obama.

(SOUNDBITE OF SPEECH)

PRESIDENT BARACK OBAMA: They found that if Governor Romney wants to keep his word and pay for this plan, then he'd have to cut tax breaks that middle-class families depend on to pay for your home, the home mortgage deduction, to pay for your health care, the health care deduction.

SHAPIRO: In Mansfield, Ohio, President Obama said this is part of a Romney pattern: hurting people who need help and helping those who are doing just fine.

(SOUNDBITE OF SPEECH)

OBAMA: He's asking you to pay more so that people like him can get a big tax cut.

SHAPIRO: Romney's tax plan was not the only focus of the president's Ohio visit. About one in eight Ohio residents works in the auto industry, and in Akron, the president said he can take credit for its rebirth.

(SOUNDBITE OF SPEECH)

OBAMA: They counted the auto industry out, and now it's coming back stronger than ever, right here in Ohio and all across the country.

SHAPIRO: A new TV ad from the Romney campaign tells it differently. The spot blames the Obama administration for closing car dealerships during the restructuring.

(SOUNDBITE OF POLITICAL ADVERTISEMENT)

UNIDENTIFIED MAN: Well, we had 30-some employees out of work. My wife and I were the last ones there. You know, it was like the dream that we worked for and that we worked so hard for was gone.

SHAPIRO: On Air Force One, Obama campaign spokeswoman Jen Psaki said the Romney campaign has it backwards: the president actually saved almost a million auto industry jobs.

JEN PSAKI: And, you know, Mitt Romney is the same person who wrote an op-ed saying let Detroit go bankrupt. If we had done that, if the country had done that, if the president had done that, it would have been disastrous for not only Ohio, but the country.

SHAPIRO: This is a potent debate in towns like Mansfield, where retiree Rosemary Martin knows plenty of autoworkers.

ROSEMARY MANSFIELD: My deceased husband worked at GM for years, and we had a good life. And I really feel bad for the people in this town that the GM plant is not here anymore. But I do believe that President Obama is doing all he can for the middle class and the auto industry, especially.

SHAPIRO: That sentiment comes across in a new poll of three important swing states. The New York Times, CBS, and Quinnipiac survey gives the president a lead in Ohio, Pennsylvania and Florida, where he campaigns today.

Ari Shapiro, NPR News, traveling with the president. Transcript provided by NPR, Copyright NPR.