In baseball talk, the presidential campaign is in the spring training part of the season. That part of the year follows the “hot stove league,” when teams make trades and sign players while fans and reporters have fun assessing the strengths and weaknesses of each team.
We’re well past the campaign “hot stove league” now, and are instead in the equivalent of the exhibition games that ball clubs play to determine what rosters they are going to take into the regular season. In the presidential campaign, it’s the caucuses and primaries that serve that purpose.
Real voters are now in the process of picking their rosters for the general election (the “real” season) that will start later in the year, in late spring, give or take a few months, when the parties ultimately settle on their final rosters, those being the presidential tickets that will vie for the right to lead the nation for the next four years.
The Democrats, unless something highly unusual should transpire, have their team in place. They will run Barack Obama for re-election for president with Joe Biden again filling the role of next-in-line as the nominee for vice-president. In that respect they are like the major league team that has won the previous World Series and has its roster set for the coming season.
But they are an injured team, having taken any number of hits over the almost three years of their reign, and they are hardly pre-season favorites heading into the coming campaign, dragged down by an economy that is sputtering and with the equivalent of a .240 team batting average (a sub-50% national approval rating).
Team Obama is, in other words, ripe for the plucking, if the opponents can field even a reasonably competitive ticket. Such a ticket would need, first and foremost, a strong fan-base, but therein lies the rub.
The obvious pick to head the ticket, Mitt Romney, is insufficiently attractive to the party’s base, which is the dominant force in the nomination process. The concerns about him principally turn on the perception that he is not a true conservative. And that perception flows from the fact that he has been a self-declared moderate/progressive in the past and, as governor of Massachusetts, signed a health care reform act that is very much the model for the federal health care reform law that Obama and the Democrats pushed through.
The irony (one of many, actually) is that Romney’s positions then were far closer to the mainstream of what used to be the Republican base. But, oh, how times have changed.
Now, the party is where its fringe used to be, and where the base used to be is pretty close to where Obama is on many issues. Health care reform is certainly prominent among the evidence of that fact, as the Affordable Care Act that he signed into law looks very much like the plan proposed by the Republicans in 1993 when Bill and Hillary Clinton were pushing for a far more radical adjustment to the health care needs of the country.
But now, what used to be orthodoxy in the GOP is anathema to the Tea-Party dominated party of Lincoln. Not that the rest of the country, or even the bulk of those who are registered Republicans, is aligned with the anti-government views that have become the accepted dogma for the primary- and caucus-voters who are currently determining the party’s fate.
Romney has been unable to poll much above 25% of registered Republicans in almost every national poll in this cycle, and he wasn’t able to break through that barrier in his prior run in 2008. In other words, he isn’t cutting it within his own party, even though he may be the only candidate calling himself a Republican with a legitimate chance of defeating the incumbent.
Instead, the party faithful have rallied, in turn, around a succession of pretenders (in the sense that all of them are so badly limited and/or flawed as to be totally unrealistic options).
And so we have seen the likes of Donald Trump, Herman Cain, Michelle Bachmann, Rick Perry, Newt Gingrich, and Rick Santorum inspected and found wanting (and, in the case of Gingrich, re-inspected a couple of times and still, ultimately, found wanting), either because their deficiencies quickly became readily apparent (Perry), their pasts caught up with them (Gingrich), or their un-electability became obvious (Cain). (Jon Huntsman was deemed “not-conservative-enough,” having committed the unforgivable sin of serving as Obama’s Ambassador to China.)
And so, amazingly, the party faces the very real possibility at this relatively early stage of the campaign season of blowing a sure thing.
Not that anything is guaranteed, but under normal circumstances, the likelihood that a sitting president would be re-elected with unemployment north of eight percent is minimal at best. The last incumbent to do it was Franklin D. Roosevelt, who won because he had brought the rate down from the high teens when he took office at the outset of the Great Depression.
Obama came into office just as unemployment had begun to soar, and he then made the ill-advised comment to the effect that if unemployment was still over 8 percent in three years, he would be looking at a one-term presidency. And, as might be expected, Mr. Romney is using that comment in his campaign stump speech.
It could be a line he lives to regret, assuming he does get the nomination, which, sure thing that it has appeared to be, is not a sure thing (especially after his trouncing in South Carolina). If recent trends (over the last six months) continue, the unemployment rate might well be at or a tad below eight percent by the time voters actually cast their ballots later this year.
Or, failing that possibility, it may be in the low eight-point something range, allowing Obama to make a Trumanesque anti-Congress pitch that would go something like this – “If the Republicans hadn’t been so obstreperous, we’d be doing even better at cleaning up the mess their party created in the first place.”
And so, as the exhibition games get rolling, and the Republicans continue to struggle with the ABR (Anybody-But-Romney) field, the unlikely possibility becomes ever more probable: Obama will win.
WHY MITT ROMNEY SHOULD & WILL LOSE TO PRESIDENT OBAMA
by Fred Galves
When Americans see how unfair the current tax structure is because it favors the super-rich, and how Republicans will fight like hell to protect that inequitable tax structure no matter what, Romney will lose. Although it is true that we need to cut spending, reduce our debt, and help pay taxes in order to raise revenue, in these difficult economic times, when families are struggling, Republicans ONLY want to cut Education, Food Stamps, Welfare, Healthcare/Obamacare, “privatize” Medicare, Medicaid, “restructure” Social Security, Aid to Families with Dependent Children, etc. They justify doing so because these government programs are all alleged to be nothing but “wasteful,” “socialist” spending on lazy or otherwise undeserving “takers” in society, who take the hard-earned money from the “makers” in society. But millions of voters are also working class and middleclass Americans who must pay their taxes at various tax rates.
Here’s a quick rundown of what the Federal income tax brackets will look like for 2012:
Tax Bracket Married Filing Jointly Single
10% Bracket $0 – $17,400 $0 – $8,700
15% Bracket $17,400 – $70,700 $8,700 – $35,350
25% Bracket $70,700 – $142,700 $35,350 – $85,650
28% Bracket $142,700 – $217,450 $85,650 – $178,650
33% Bracket $217,450 – $388,350 $178,650 – $388,350
35% Bracket Over $388,350 Over $388,350
Let’s see how Mitt Romney compares to other Americans in terms of shared sacrifice and relative tax burden. First, Romney has a net worth of over $250 million—a quarter of a BILLION dollars; which is far more than the average income for American households of just over $50,000! Almost all of Romney’s yearly income is made off of his investments, so the reality is that he currently does not work and earn a salary. Instead, he lives off of his investments as he has been running for president for the last 5 years. So Romney makes millions of dollars per year at this point for doing nothing because he makes almost all of his money off of his previous investments. If he even makes just a 1% return off of his net worth, then he gets $2.5 million in income a year, and if he makes a 10% return, then he gets $25 million in income a year. But the critical point is this: however much income he receives from investments; he only has to pay 15% in taxes on those millions of dollars received. In fact, Romney recently admitted, when he was asked by a reporter, that he pays only 15% in taxes.
Note that 15% is far LESS than what many middleclass people must pay as a percentage of their salary or hourly earnings income. In fact, Romney pays the same low rate as a single person who makes only $8,700 to $33,500 a year in salary. And a single person making between $33,500 and $75,000 a year actually has to pay 10% MORE in taxes than Romney pays on his millions earned per year! IS THAT FAIR? … CAN YOU COUNT? Why do Republicans defend this inequity and disparity so strongly? Would Romney really NOT invest his money if it got taxed at a higher rate? If so, what would he do with his money, NOT invest it and go get a job? Maybe he would just invest it overseas in a tax haven—that would be awfully patriotic and “country first” of him, wouldn’t it?
Mitt Romney did not work during 2011, although he made $374,000 in speaking fees, and on that amount he had to pay 33% in taxes. It is very revealing that he described that $374,000 he made from his speaking engagements as “not very much.” Note also that Romney averaged over $41,000 for each one-hour speech he gave. He therefore “made” in one hour (just in fees, even ignoring his millions in investment income), as much as some people in this country make during an entire year! This information will all come out when Romney finally releases his tax returns (which he reluctantly agreed to do in the most recent debate, although he still just said that he would “probably” do it).
But watch how Romney is going to try to release ONLY his 2011 taxes, if he releases anything. That is very telling because his 2011 tax return will be a tax return that his lawyers can still write up at this point, although it is going to be very economically painful for him because he is now going to try to pay more tax than he has been paying in recent years (for political cover reasons now that everyone will get to see what he made, and how much he paid, or did not pay, in taxes). And watch also how he will absolutely refuse to produce his tax returns for the last 5 years that have already been filed—because those tax returns cannot be sufficiently doctored at this point for the prying eyes of the press.
Obama, on the other hand, submitted his taxes for the 7 previous years back when he ran for president in 2008. Romney cannot fake or forge his earlier tax returns that have already been filed which will show that he paid taxes at the percentage rate of only 15%, or perhaps even less if he had good tax lawyers. Romney’s tax returns likely will also show how much money he makes from overseas investments upon which he hardly pays any US taxes, and where he created jobs mostly overseas, but not in the US—how “patriotic” and “country first” was that? As it turns out, Romney reportedly has a lot of money currently parked in the Cayman Islands, a notorious foreign tax haven for money launderers and those seeking tax shelters from their own governments—Well-played, Romney, and “God Bless the USA!”
Obama therefore could not ask for a better opponent in Romney in 2012. Romney is “the 1%” that represents the worst kind of example of a super-rich capitalist living off of his vast wealth who does not pay as much in taxes as a regular person earning more than $35,350 per year. So a person making $36,000 per year pays taxes at a 10% HIGHER rate that Romney does on his millions! And Romney pays the SAME low rate (15%) as a person making only $10,000 per year—wow, that’s fair! But most of all, Romney advocates cutting taxes for the rich, for people just like him; while his tax plan hypocritically and opportunistically raises taxes on the middle class and poor folks. The Republicans may be able to brainwash some poor and middle class people to vote against their own economic and tax interest, but it will be very difficult to do so when Romney is exposed as a super-rich capitalist advocating big tax cuts for people like himself, as well as protecting his 15% tax rate that is much lower for him than it is for most regular folks. There are many reasons why Obama should win the 2012 presidential election, but I think Romney will lose based on this unfair-tax-breaks-for-the-super-rich reason alone. It is not just that Romney is part of the idle, super-rich; it is that Romney is actively and selfishly protecting the rich, like himself, through the tax and fiscal spending policies he supports. Perhaps most unfair, Romney also gets to treat his brokerage income as a capital gain and therefore pay only pay 15% on that income as well.
So for any Romney supporter out there, please answer this: is it fair that he pays only 15% taxes on his millions of dollars in income made from his investments, while a $36,000 per year salaried or hourly-wage worker has to pay 25%? Moreover, that $36,000 per year worker has to work all year for that salary, while Romney simply can sit back and live off of his equity investments originally invested years ago. So just to be clear, middle class people have to work for their income, while Romney, at this point, does not have to work, because his money now works for him and generates all of his income. That means Romney gets to sit back and receive millions in dividends, while a $36,000 a year worker does not, has to work for that $36,000 all year, and then must pay 10% more in taxes on it than Romney. How well do you think Romney will be able to relate to the common voter, especially in these economic times?
But isn’t this mere “class envy” on my part? OK, fine, I can accept that Romney is part of the super-rich, and that I am not; and that he deserves his money and is entitled to his success as a super financier investor. But despite his annual millions in earnings that he rightly “earns,” Romney gets to pay 10% LESS in taxes than a $36,000 per year worker. How can anyone possibly think that is fair by any stretch of the imagination? If you think that is somehow fair, can’t you see how you are being played by the super-rich and you don’t even realize it because the super-rich have convinced you that if anyone questions their unfair tax rate of just 15% on investment income, it is because that person is a “class envy,” “class warfare,” “liberal” who is nothing but a “European Socialist,” even “Communist,” who just wants to destroy our American values! Wake up my friends, you are smarter than that.
This is not just “class envy.” This unfair tax disparity is exactly why Warren Buffet, the third richest man in the world, originally raised this issue where he gets to pay 15% on all of his investment income, yet his secretary must pay a much higher tax rate as a regular salaried employee tax payer. Buffet admitted how unfair it was for him. Think about it, the only people who have a lower tax rate than Romney are people earning $0-$17,400 a year (10% instead of Romney’s 15%)—for example, teenagers who have summer jobs, or otherwise low-skilled or unemployed or under-employed people. Is that fair? Remember, it is only called “class warfare” when the middle class fights back! And nice try but this is not a fundamental criticism of capitalism; instead, this is a criticism of a very unfair tax structure that favors the super-rich at the expense of the poor and middleclass. This is not a call for “socialism” from a liberal comrade; instead, it is a call for simple “fairness” and common decency from a fellow democracy-loving American.
Finally, I guess you can argue that Romney is not so bad in light of the fact that at least he pays a 15% tax rate, because after all, General Electric, “GE,” paid 0% in taxes recently—zero taxes!! Poor Romney, if only he were a multi-billion dollar corporation that could find all of these tax loopholes yielding a zero-tax result, then he would not have even had to pay that burdensome, socialistic 15% in taxes!!! Oh, but the super-rich are taxed way too much by the socialist, liberal, out-of-control, Obama government/regime. Moreover, it is really all of the lazy welfare-cheater single moms who want free healthcare and Food Stamps (and just waste it on booze and cigarettes) out there that are the ones who are actually ruining our economy and causing all of our debt and deficits, right? Maybe if all of those “welfare queens” could somehow become huge national banks and investment companies on Wall Street, then their “welfare” would no longer be called “welfare;” instead, it would magically become a necessary government “bailout.” Have we given up on basic fairness in this country? I hope not.
You ask, “is it fair that he pays only 15%”?
First of all, you are focusing on a miniscule minority of people who make most of their money via Capital Gains. Even if you doubled their Capital Gains rate, it wouldn’t even be a drop of drop of a drop in the bucket to offset our deficit. I think we’d all be better served if we, especially our President, spent time on things that will make life better for 350 million Americans rather than majoring in a minor. Obama’s pandering.
15% is the tax rate, don’t paint Romney a bad guy because he earns a lot of money. You are playing into the stereotype of wealth envy.
If you would like to raise the Capital Gains tax, then say so. Obama has not proposed raising Capital gains. So apparently he doesn’t think it’s unfair, or maybe he thinks that investment like that fuels growth and should therefore not be squelched.
Second, the vast majority of people making over $250K (Obama’s obsession), pay tax on ordinary income, not Capital Gains. As you point out from your table, those people pay a far greater percentage of their income than those making less. For example, people making $250K already pay 17.8% more in taxes than the bracket just below them (28% vs. 33%). Is this unfair to you? To whom is it unfair, those paying 28% or those paying 17.8% more just because they’ve earned a little more? Do you want to raise it, like Obama does, to make it even more egregious?
Finally, those earning over $1 million will pay, on average, 29.1% in federal taxes. Those earning between $50,000 and $75,000 will pay 15 percent. * Get it?
In addition, the top 10% of earners in this country pay 70% of the Federal income tax. ** So how about we stop wasting time on the 500 or so people in the U.S. that you and Obama are focused on, and how about we knock off the divisive rhetoric of the rich “not paying their fair share”, because it’s nonsense.
By the way, wealthier people pay more property tax because they live in more expensive houses. Wealthier people pay more sales tax because they spend more.
Two final points:
1) You only make Capital Gains if your investments are successful. The companies that you, I, Mitt Romney, Al Gore, or Warren Buffett invest in have to succeed, and every dollar they earn is taxed before profits are distributed, where they are then taxed again on you, at 15%.
2) Republicans don’t want to destroy all the programs you cite. Republicans don’t think that all the programs you cite are “wasteful, socialist, spending to lazy undeserving people. You create a caricature in order to denigrate those with a different view. Republicans think that all the well intended entitlement programs have grown beyond what we can afford, and they are right. The left refuses to face the fact.
Since Medicare, Medicaid, and Social Security costs are unsustainable, they have to be changed. Every single analyst correctly points out that our deficit problem cannot be fixed without addressing these items. The brutal truth is that taxes can never be raised enough to pay for everything, and if that were tried, it would crush the economy and result in less tax revenue flowing in anyway.
So what’s the Democrat’s answer? Silence. What’s Obama’s plan? No plan at all.
Rather than trash Republicans, how about choosing leaders that admit the problems and put forth plans to address them?
* http://abcnews.go.com/blogs/politics/2011/09/fact-check-the-richtheir-secretaries-and-taxes
** http://www.taxfoundation.org/news/show/250.html
Just to put a stake in the ground, I’m convinced that anyone who votes for either a Republican or a Democrat anymore (with one or two interesting exceptions) is either selfish and greedy, uninformed, or living in a fantasy world. That said, I find it amusing that a professor who stands up and talks for pay characterizes Mitt Romney’s standing up and talking for pay as “not working.” Kinda hurts the credibility of the rest of the lecture.
Obama just might have luck at his side this election. Much is unsettled and unknown economically and can’t be managed by the White House but if we see the economy improve prior to the election Obama will stay in office. As Ed explains the Republicans have placed themselves in a bind with only flawed candidates to pick from. I believe there are many Evangelicals who won’t vote for a Mormon. That which uplifts the Mormon faith would be anathema to them and surely a Romney win would do just that. These Evangelicals will quietly vote for Obama as they know he believes in their God, their Trinity, their Holy Scriptures. The White House will use a bit of the Nixon Southern Strategy, elevating peoples fears and bigotry. This will be done by third parties with lots of money thanks to Citizens United v. Federal Election Commission.
Enjoyed your column Ed.
Rico – There’s a world of difference in my mind between a professor teaching a course on a subject he/she has mastered, and a politician/venture capitalist giving a somewhat tempered stump speech to sycophants and disguising it as something informative in an effort to remain relevant in the run up to another bid for a nomination. There’s teaching and there is talking and I don’t believe anyone walks away from a Romney speech with much applicable insight.
The following comment was submitted by Alice Thomas, who is a recent graduate of the McGeorge School of Law. Alice had difficulty posting her comment directly to the blog. If others are having similar difficulty, please let me know and I’ll post for you.
Life today for the 99% is like playing poker against someone with a marked deck or playing craps against the house with loaded dice (Conservative Republicans v Progressives (Liberals)- or the nonworking class v. working class. After 30 years of class warfare by the conservatives – we now have:
1. Pensions, especially defined benefit pensions, are almost nonexistent. And even if they aren’t, they can be wiped out by Chapter 11 Bankruptcy – and have been – See American Airlines as the latest case. There have been many other corporation who have dumped their pension obligations on the U.S. taxpayer (in addition to bank bailouts) through the Pension Benefit Guaranty Fund. Retirement 401(k) plans may or may not yield retirement funds – it depends upon what your funds are invested in and when you retire (or are laid off or fired). This plan is not guaranteed or an annuity – like Social Security.
2. Regressive taxes paid by the working class. Wealthy persons and Multinational corporations have figured out how to load most of the taxes onto the working class – so now the working class can make up the deficit caused largely by making the United States the 911 number for the world. One of the Republican candidates wants to bomb Iran (probably would start another war) – but conservatives don’t want to pay higher taxes to pay for another war -or anything else for that matter.
For a complete explanation of how the 1% wealthy and multinational corporations have avoided paying a fair share of income tax – see David Kay Johnston, 2001 winner of Pulitizer Prize winner and author of Free Lunch: How the Wealthy Americans Enrich Themselves and Stick You With the Bill.
3. Housing values have dropped – anyone who is counting on equity in a home to finance retirement is likely to be sorely disappointed since so many homes are “under water” – loan exceeds value of home. This loss, as most people have come to realize, was due to change in banking laws that has allowed the banks to gamble with taxpayer insured funds – when the Glass Steagall Act was “defanged.”
4. Social Security and Medicare are being attacked as too expensive – and any existing SS funds are being eyed as monies to be used to reduce the deficit or to make up any revenue shortage caused by the 1% not paying a fair share of taxes. The argument that the rich should not have to pay taxes because that is the class that creates jobs just doesn’t fly. The tax advantage has been in effect ever since Bush got into office – and the unemployment rate has been at least 8.5% for the last 3 years or more – but may be higher than this because not all of the unemployed or underemployed are counted. The large numbers of unemployed, of course, cause downward pressures on wages/salaries.
Further, Social Security benefits are not keeping up with inflation. The “core” CPI is used to determine benefits – the “core” CPI omits energy and food – ‘TOO VOLATILE” is the excuse. But unless I have missed something, the cost of both has greatly exceeded any increase in benefits or wages/salaries. These are two items, unfortunately, that low income people must buy first – stay warm or cool as weather dictates and eat – to stay alive.
5. Labor unions have been pretty much “defanged”. For some reason, most of the public seems to believe that working people have no right to negotiate for wages – and neither political party has done anything substantial to promote union membership. Unions came into existence because of the lack of Unequal Bargaining power.
6. Our Congress, it appears, has been bought by the conservatives. Some years ago – back in the 1970s, I had to read a book with the title of The Finest Congress Money Can Buy – 10 years later – the sequel was published, Still the Finest Congress Money Can Buy – now, some 35 years later this still exists – only with more politicians bought by the business lobbies. There are some who believe that unless we have a Constitutional amendment we will lose our democracy – if we haven’t already lost it. Those of us who cannot afford a lobbyist simply are not represented in Washington.
Or – you might be interested in new book by David Stockman,, former budget director for President Reagan speaks candidly with Bill Moyers about how money dominates politics, distorting free markets and endangering democracy. Please note – Mr. Stockman is a REPUBLICAN – and probably NOT A LIBERAL.