By now you’ve heard of the proposal floated by one Republican on the Super Committee to “raise taxes by $300 billion” over the next ten years as part of the $1.2 trillion deficit-reduction plan. The lone Republican? Pennsylvanian Senator Pat Toomey, that’s who. Hopelessly locked in a quandary between a unified Democratic opposition to any deficit-reduction package that does not include some revenues and an equally unanimous steadfast rejection by the conservative flank of his own party against any tax hikes, Toomey has come up with a way to have his cake and eat it too. He has baited Democrats with promises of additional revenues in exchange for the lowering of tax rates on all income brackets, the lion’s share of which would come from the top bracket. And the source of the “revenue” would come from the elimination of tax deductions, mostly from the middle class.
Toomey’s plan basically has two stages:
1. All tax brackets would be reduced, starting with the top bracket, which would drop from 35% to 28%. The lowest bracket would fall from 10% to 8%.
2. To make up the anticipated loss in tax revenues, all charitable donations and mortgage interest and state and local tax deductions would be eliminated for individuals earning more than $174,400 and married couples earning more than $212,300.
Critics of the plan were quick to point out that roughly one third of all filers – or 50 million households – would see a precipitous increase in the taxes they pay every year, not to mention that the elimination of the mortgage deduction would adversely affect a housing market which is still trying to recover from the worst crash since the 1980s, with experts predicting years before a full recovery occurs. Additionally the loss of charitable donations would be devastating to countless charities, churches and synagogues that provide, in many instances, the last hope for millions of impoverished people.
Of course the switch in this bait and switch scheme of Toomey’s is the “revenue” part. The fact is there isn’t any real revenue, because the elimination of the deductions under this plan would barely cover the lower tax rates. At best it would be revenue neutral to the Treasury, at worst it would actually increase the deficit. At the end of the day, millions of Americans would end up paying more in taxes just to enrich the wealthiest 1 to 2 percent of their fellow citizens.
This is what the GOP offers up as a fig leaf to appease Democrats and deficit hawks within their own party. Not a balanced plan to reduce spending AND legitimately increase tax revenues, but a scheme designed to appear as revenues that is in effect nothing more than supply-side economics on steroids.
I would’ve had more respect for Toomey and his ilk if, while he was asking hard-working middle class families to make a sacrifice, he had proposed eliminating other tax deductions like corporate jets and the like. But then I’ve long since given up any hope of having even an ounce of respect for a party that still has the nerve to invoke the name of Lincoln, but who long ago abandoned any resemblance to that historic president and what he truly represented.