The Mittens Tax Debacle

Today, Mitt Romney released his 2011 Tax Returns. That’s great- it’s what politicians should do. I’m an advocate for tax return releases because there are federal consequences for lying on them, and there aren’t on the campaign trail. That means a candidate cannot misrepresent their success and contributions to the government for gain.

The 2011 tax return was largely unremarkable. The only point that raised eyebrows had to do with charitable contributions. Earlier this year, Romney reported that he would not be paying less than 13% in taxes. However, had he claimed the full deduction for the $4 million Romney gave to charity last year, he would have come in at around a 10.5% tax rate. As a result, he only claimed a portion of his charitable giving. In other words, he paid more taxes than was required in order to line up with his original estimate.

Why did this raise eyebrows? Because in July, when questioned about his taxes, he had this to say:

I don’t pay more than are legally due and frankly if I had paid more than are legally due I don’t think I’d be qualified to become president. I’d think people would want me to follow the law and pay only what the tax code requires.

So you’re saying that someone who pays more taxes than they are required to is not qualified to hold the office that you are running for? Ok, good to know. Thanks for releasing that 2011 tax return. Should help us out in selecting a qualified president.

Ignoring Romney’s billionth foot-in-mouth moment, there was still that lingering question about his tax returns prior to 2010- and his 2009 returns, in particular. To respond to these concerns, the Romney campaign released a notarized letter from PriceWaterhouseCooper- the firm that handles Romney’s taxes- summarizing his taxes for the past twenty years. Here’s what it told us:

  • Romney, in each year, had no effective federal personal tax rate lower than 13.66%.
  • The average annual tax rate for Romney was 20.2%.
  • On average, the Romney’s donated 13.45% of their income to charity.

That sounds pretty comforting, except….

  1. His 2011 and average annual tax rates are still lower than the payroll tax rate. Why does it matter? Earlier this week, comments from a Romney fundraiser were released where he claimed that 1) the only people that vote for President Obama are the ones that don’t pay taxes [I disprove this argument, btw], and 2) those people have no sense of personal responsibility. What he forgot to mention was that over 20% of those individuals pay the federal payroll tax, and that tax rate, at 15%, is higher than what he pays, adding insult to injury on his attacks on the character of those receiving government aid.
  2. This does not tell us if any of the returns were refiled, and if they were, when the refiling took place. Several jouI rnalists have begun to ask the Romney campaign for such information, but no answers have been given to date. Why is this significant? It is entirely possible- particularly in 2009, assuming likely losses from 2008 being carried forward- that Romney initially paid no taxes at all. Refiling would remedy that PR nightmare. The same applies to any given year in the track record actually; if any percentage paid was too low to be publicly satiable, the changes would have been fairly easy to make, but would also explain the delay in disclosure.
  3. It has been widely speculated that any gains made by Romney in 2009 were the result of short selling various stock. While a perfectly legal practice, such a revelation would fly counter to Romney’s gusto for American business (hard to exude confidence when you contributed to plummeting stock prices), and potentially piss off so larger donors. None of the information released answers these questions. It’s not information he’s required to release, and frankly, it’s not a huge deal to me, but from a campaigning perspective, had this information been released MONTHS ago, they could have dealt with an issue before it had a chance to cause problems, and fester into heated accusations.
  4. It tells us that a great deal was given to charity, but the charitable funnel is an organization called the Tyler Charitable Foundation. No big deal, right? Wrong. The Tyler Charitable Foundation, in 2010, provided funding to a grouping of “pro-marriage” (read: anti-LGBT rights) groups, including one whose leaders who compared LGBT activists to Al-Qaeda. THOSE returns are substantial, because they reflect on the values of Romney, and gives insight into where he’ll stand on social issues.
  5. This was just NOT strategic. It was a transparent attempt to deflect attention from his two week stretch of gaffes, which is understandable, but the insistence on releasing a SUMMARY, instead of the ACTUAL RETURNS, is a  gaffe in and of itself. We’d all but stopped talking about it, and Romney decided to drudge it up again this close to the election by reaffirming opposition to releasing returns? Inexplicable.
  6. So, this may just be me, but having worked in the industry that was royally screwed over last year by PWC’s incompetence in the MFGlobal case, I have a hard time putting a ton of stock in a anything they say or do. But that’s just me.

Overall, this was a ploy, and a badly executed one, at that. That entire campaign needed to be gutted circa the London trip- what a fiasco.


Why the 2012 Election Matters More Than You Think

Source: Politico

It’s official. With Romney revealing Republican Congressman Paul Ryan as his Vice-Presidential pick, and a mere 86 days until election day, the election season is ramping up to fever pitch. This election is set-up to be one of the most significant in decades, but not for the reasons that most are talking about.

The economy sucks. There’s no doubt about that, and there’s a good chance it gets a lot worse before it gets better. The deficit is ballooning, and then there’s that buzz word everyone likes to throw around- the Fiscal Cliff. What does that mean, exactly? The Fiscal Times explains:

The “fiscal cliff” is what Federal Reserve Board Chairman Ben Bernanke has called the many major fiscal events that could happen simultaneously at the close of 2012 and the dawning of 2013. The events include the expiration of the Bush era tax cuts, the payroll tax cut and other important tax-relief  provisions. They also include the first installment of the $1.2 trillion across-the-board cuts of domestic and defense programs required under last summer’s bipartisan deficit reduction agreement.  At the same time, lawmakers may have to raise the debt ceiling once again, potentially triggering another standoff in Congress.

So there’s that. The problem is that Congress won’t tackle the issues in any meaningful manner until AFTER the election. The cuts in question are, at a minimum, controversial, and it’s much easier to run on fluffy talking points than actual policies. The economy, has, deservedly, become the focus of this election, but the reality is that, despite the focus, the campaigns aren’t actually addressing the concerns in any substantive manner, and the solutions that HAVE been presented aren’t all that great. Even with the sparse policies available for examination, the campaigns aren’t pragmatically discussing the pros and cons, relying on sweeping campaign rhetoric to guide public opinion.

With neither side presenting a great case on fiscal policy, other issues are of greater significance, but none more so than the battle over same-sex marriage. I’m pretty sure I’ve made my position on the issue abundantly clear by now. Its importance cannot be understated. If the Constitution says all humans born or naturalized in the United States are entitled to the same privileges under the law- and the tax benefits, survivorship rights and more associated with legal recognition of a marriage are privileges granted by the government- banning same-sex marriage, and access to the privileges therein, tells those in same-sex relationships that they are less than human. 

But why should anyone pay attention to the candidates’ positions on same-sex marriage? Typically, I’m not one to encourage single issue voting, especially since Presidents do not control the legislative process, but this time is different. Consider, via the Wall Street Journal:

The Ninth U.S. Circuit Court of Appeals on Tuesday declined to rehear arguments over a California ballot measure banning gay marriage, after previously upholding a district court’s rejection of the law.

The decision is the final marker before the case likely moves to the U.S. Supreme Court. […]

Andy Pugno, a lawyer for the group supporting Prop 8, said the ruling “essentially clears the way to where we ultimately knew this was going, which is the U.S. Supreme Court.” He said he would ask the Supreme Court to take the case. […]

Ted Olson, another lawyer representing the plaintiffs, said the Supreme Court would likely decide in October whether to hear the case, and if it does, would probably issue a decision by June 2013.

Mr. Olson said the case could head to the Supreme Court in the same time frame as a separate challenge to the 1996 federal Defense of Marriage Act. A federal appeals court in Boston last week ruled that the federal measure, too, was unconstitutional.

The case would head to the Supreme Court at a time when public opinion on gay marriage is shifting. Polling analyses by the Pew Forum on Religion and Public Life showed that in 2004, 60% of Americans opposed same-sex marriage and 31% supported it. This year, Pew said, 43% of Americans oppose gay marriage while 47% support it.

This issue is about to be heard by the highest court in the land, and the decision will either be the Plessy v. Ferguson or Brown v. the Board of Education on this subject. For those of you wondering why a pending decision by the judiciary has any bearing on a Presidential election, consider, via (begrudgingly) the Daily Caller:

The final reason for the especially high stakes is that the Court’s balance is up for grabs. Since Justice Thomas replaced Thurgood Marshall 21 years ago, no president has had a chance to alter the Court’s precarious 5-4 conservative majority. But during the next administration, three justices — conservatives Kennedy and Scalia and liberal Ginsburg — will reach their 80s. Whoever wins the presidency likely will have the chance either to strengthen the Court’s conservative majority or shift the balance to the left.

The replacement of a single conservative justice by a liberal would produce a profound shift in constitutional law. Most important cases are decided by a 5-4 vote along conservative/liberal lines, encompassing such vital issues as property rights, campaign finance, school choice, federalism, the rights of criminal defendants, Second Amendment rights and constitutional limits on congressional power.

When the Romney campaign has made clear that they believe in a “traditional” definition of marriage, and gone so far as to express support for a federal law banning same-sex marriage, it’s not hard to consider the potential ramifications of their nominations on the Supreme Court. Of course, there’s no guarantee that such a nomination would occur before the issue of same-sex marriage hits the docket, but because there is a chance it does, potential nominations are of the utmost importance.

Your vote could determine whether the courts adhere to the Constitution or regress to the pre-Civil Rights era. The economy may be the most immediate challenge we face, but in a world where neither side is offering a solution, it’s time we pay attention to the issues upon which they can and will act. Quit hiding behind the rhetoric of tax rates and breaks that are being misconstrued and abused on each side, and hold these candidates accountable for their influence on the most critical civil rights issue of our generation.