Romney’s 47% Problem: Tax Relief is a Bipartisan Idea

Romney

September 18, 2012; Source: National Review Online

Poor Mitt Romney can’t even catch a break from his nominal ideological allies. In Romney’s surreptitiously videotaped speech to a gathering of superwealthy Republicans disparaging 47 percent of the population as some agglomeration of people dependent on and looking for government handouts, one of his tropes was straight out of the current conservative political canon – that too many Americans don’t pay income taxes. These Americans don’t pay taxes, or only pay payroll taxes, not because they’re avoiding taxes, but because their incomes are so low that they aren’t taxed or because they are aided by specific policies that, once upon a time, got bipartisan support. But actually, Governor, it’s not 47 percent; it’s 46 percent, and it’s not because they’re freeloaders.

Romney’s critique of people who don’t pay taxes is a little like the current Republican critique of the individual mandate in the Affordable Care Act, which somehow conservatives choose to forget was an idea generated by the Heritage Foundation. As Reihan Salam, a blogger for the National Review Online, notes, the reason so many “tax units” (that is, taxpayers, which could include multiple “units” within families or households) don’t pay taxes is also due to a Republican idea – the Earned Income Tax Credit.

Let’s break it down. Half of the 46 percent have incomes so low that after you deduct the standard deduction and exemptions for dependent children, there’s no income left to tax. The other half of non-taxpayers are seniors who don’t pay some income taxes and others who benefit from childcare tax credits, etc.

For many of the non-taxed families who are earning incomes, they qualify for the Earned Income Tax Credit, a program once very popular with Republicans. The conservative attraction to the EITC was its function as an incentive for working families compared to welfare payments to families that don’t work. It was a very Republican idea – subsidizing work, not welfare. Have conservatives forgotten the rationale for their support of the EITC? Have they forgotten that this was a Republican program?

One of the roles of many nonprofits is helping low-wage workers remember their EITC eligibility. The National EITC Outreach Partnership includes a variety of nonprofits promoting awareness of and access to the EITC, including Catholic Charities, Goodwill Industries, the United Way of America, the National Black Church Initiative, and others. We feel quite confident that the members of this coalition do not see themselves as aiding and abetting government freeloaders. Perhaps Mitt Romney should check in with his stalwart supporters in the nonprofit sector to remember why they, as well as Romney’s Republican predecessors, support the EITC. –Rick Cohen