Everyone by now is aware of Romney's comments suggesting utter disdain for the 47% (actually, 46.4%) of Americans who didn't pay federal income tax in 2011. Those non-payers are the poor, the unemployed young, the retired elderly, the low-income families with children to support. And those who don't pay federal income tax nonetheless do pay payroll taxes, state and local income and property taxes, and sales taxes. Most of those do work (for the working poor with children, that may mean 2 or more jobs trying to make ends meet)--only about 8% of those who pay no federal income tax also pay no federal payroll tax.
Romney tried to "clarify" his statements, but essentially doubled-down on the idea that anybody that gets government aid is irresponsible and that having so many who are not on the federal income tax rolls represents a "society based upon a government-centered nation where government ... redistributes money [--] that's the wrong course for America." Annie Lowrey & Michael Cooper, Much of Romney's View on Taxes Conflicts With Longtime G.O.P. Stand, New York Times (Sept. 18, 2012).
Much of Romney's "thinking" on this issue owes homage to the right-wing propaganda tanks--like Laffer's nonsense claim that tax cuts for the rich will grow the economy and pay for themselves and the American Enterprise Institute's claim that "redistribution" (which the right can only see when it works to support the poor and lower-middle-class) leads to a "disengaged electorate" because people get more benefits than they pay in. Id.
This is the typical elitist class-warfare aimed at destroying America's safety net programs--those programs that attempt to apply some downward redistribution through the tax and benefits systems.
Some downward redistribution is terribly important to the sustainability of the economy: increased numbers of people suffering in the bottom income tier is detrimental, as it represents people who are likely to be ill-educated and ill-employed who find it very difficult to make ends meet or participate in the consumption patterns typical of a middle class economy.
Downward redistribution in the tax system helps compensate for the predominant upward flow of redistribution to the elite. That upward redistribution is never acknowledged by the right-wing propaganda tanks but it is highly lobbied for in DC by the likes of the Chamber of Commerce, the National Association of Manufacturers and many other right-oriented institutes.
And it is evidenced
- in the tax system (preferential rates for capital gains and ridiculous carried interest provisions that permitted someone like Romney with more than $20 million of income in one year to pay less than 15% of his "taxable income" (and likely even less of his economic income) in taxes and systematic decimation of the corporate tax system through tax expenditures like the long-standing subsidies for Big Oil and other extractive businesses, for Agribusiness, for Big Pharma, etc.);
- in the the federal contracting system (especially the military-industrial complex, in which contracts are rewarded to those efficient at playing the lobbying game even when the contractor is found to be cheating the government--like Cheney's old company Halliburton's being paid millions for non-existent cafeteria meal deliveries in Iraq or GOP millionaire Prince's security agency getting contracts for security in Iraq in the privatization of our military through mercenaries, even when it had nonexistent experience and keeping them even when it committed atrocities in a kind of lawless zone that the contracts created) and
- in the stock market system (that allows hedge fund managers to work out deals with banks like Goldman Sachs to put lousy mortgages in, sell buyers on the deal and then make money out of betting against the deal; that allows certain busineses to time trades on the markets in ways that disadvantage ordinary investors (see today's extensive New York Times expo on that one), and that generally rewards financialization of the economy at the cost of ordinary workers).
The elitist class-warfare approach evidenced by disdain for those Americans who work hard but earn little and hence don't pay federla income tax is notoriously inconsistently aimed at lower-income Americans and counter to the fundamental American values of respect for others and societal assistance of those who are disadvantaged--usually through no fault of their own.
For just one example of the inconsistency, look at Bruce Bartlett's op-ed in the NY Times: Bartlett, Some Big Corporations Don't Pay Taxes, Either, New York Times (Sept. 18, 2012). Bartlett points out that the CEO of Continental Resources claimed to pay an effective tax rate of 38%, the kind of statement that leads Republicans to "accept [the assertion] at face value, because to them there is no public policy problem that isn't caused by high taxes." Yet "[o]ne problem with the Republican theory is that many big corporations actually pay little, if any, federal income tax." Id. GE paid zero federal taxes on a profit of $14.2 billion in 2010, and Continental Resources apparently paid only 1.9% in federal taxes on profits of $700 million and had an average effective tax rate of 2.2% over the last five years. Id. And consider the example of multinationals like Microsoft that push their intellectual property offshore at "faked" market prices (nobody would actually SELL that IP to an unrelated third party) to avoid US taxes on sells of products of that IP, making tax-free profits at the expense of other taxpayers and the US economy.
As Bartlett rightly notes:
When poor people pay no federal income taxes and get a government refund because of such programs as the earned-income tax credit, Republicans are incensed, implying that if only the poor paid their fair share that the deficit would disappear. They never suggest that corporations like G.E. pay their fair share, even though the G.E. example is far from unique. Id.
The idea that cutting the [corporate] tax rate is a magic bullet to jump-start growth is nonsense, because corporate taxes are, in fact, quite low.
What shows that support for those who are most vulnerable is an American, and not just a "liberal" and Democratic value? The fact that most of the programs have decades of support from a strong consensus in the middle of society, from Republicans and Democrats. The earned income tax credit was enacted under Nixon. Even George W. Bush talked about "compassionate conservatism" and included in the first set of tax cuts some benefits for those at the bottom.
And the voters who don't pay taxes aren't necessarily Democratic either. In fact, the states with the highest percentage of non-taxpaying federal filers and the states that benefit more in government spending per tax dollar raised tend to vote Republican in presidential elections, so Romney was disdaining the very conservative, fundamentalist Southern voters on the right in states like Mississippi. Id. These people are willing to vote against their own economic interest, apparently because of their belief that the GOP best represents their "values" concerns (like prohibiting gay marriages, dictating whether a woman can have an abortion or not even after rape, etc.).
The problem is that the Republican party policy-making engine appears to have been taken over by a radical fringe element that is willing to hold America's economy hostage in order to get its way . Witness the hypocrisy of the debt-ceiling debacle, after Republican administrations had consistently spent more than Democratic ones and raised the debt ceiling more times than Democratic ones. And getting its way means doubling down on failed policies, like the concept of "free" markets that relies on bogus economic theory that has been disproven multiple times. And like the warped misuse of concepts of freedom that seems to be more concerned about the freedom of oligarchs/plutocrats to make money in whatever way they deem profitable for them, no matter the cost to workers, the environment, or US infrastructure than it is concerned about the freedom of all Americans that can be achieved by creating a sustainable U.S. economy where people from all classes have a genuine opportunity to succeed.