GOP tax pros throw in towel on Mitt's 'middle income' plan

Suppose a group of Republican economists got together with just one purpose -- to prove "liberal bias" of a non-partisan tax policy think tank report that found their candidate's tax plan raised taxes on the middle class.

Eureka! The team declared. We discovered fire can make Romney's plan work, pronounced President Reagan's Council of Economic Advisors chief Martin Feldstein. Nip an alternative minimum tax here. Lop off the estate tax there. Slice away almost every deduction for people making $100K or more and, voilà, you got your revenue neutral tax plan that doesn't touch the middle.

Then, almost immediately after revealing their great discovery, the candidate on whose behalf they're a-cyphering decides to define "middle income" as $200,000-$250,000 or less. Being good economists, despite their conservative motives, they'd been working from a ceiling of $100,000 for their "middle class."

 In an article first published in the Wall Street Journal last month and expanded on later, Feldstein said that "it is feasible to combine tax cuts and base broadening as Gov. Romney suggests without raising the budget deficit or imposing any middle-class tax increase."

Well, then their candidate opened his mouth during a "Good Morning America" interview and changed the parameters of the calculus. "Middle income is $200,000 to $250,000 and less," Romney declared. The analysts were left gobsmacked.


All their hard work to crunch a favorable set of numbers for their candidate ... and in one fell swoop their man derailed their celebratory lap. So, back to the abacus for these intrepid experts. Yet, try as they might, they could not right the Good Ship Mittens.

 Households earning more than $100,000 "are not the 'middle class,'" Feldstein wrote in the expanded version of his study, noting that incomes over $100,000 put a family well into the upper fifth of U.S. incomes. For those taxpayers, making the plan work would require eliminating all deductions and credits, he found. In addition, he said, Romney probably would need to tax the value of employer-provided health insurance for taxpayers with incomes above $100,000. Currently, the cost of insurance is not included in taxable income.

Upon hearing the sad news, their candidate dumped Feldman, declaring he obviously hadn't accounted sufficiently for the amazing growth a New Romney Economy would miraculously create, and took up with a new study buddy Princeton's Harvey S. Rosen.

Weighing in on Romney's airy-fairy economic projection, Rosen's bottom line came down to:

"The honest answer is that no one knows for sure."