Romney's Taxes

By Paul Krugman, The New York Times

25 January 12

ust about what we expected. He really needs to provide earlier years, if only to clear up suspicions that he began sanitizing his portfolio in preparation for his presidential run.

The right-wing apologetics now focus on the claim that Romney's taxes aren't really low, because we should impute the taxes that corporations effectively paid on his behalf. But there are at least two things wrong with this argument.

First, $13 million of the total was carried interest, which gets taxed like capital gains but is really just commissions that receive special treatment for no good reason. No profits taxes were paid on that income; right there, a minimally defensible tax code would have levied $2.6 million more in taxes on Romney.

Second, just the other day the usual suspects were calling for big cuts in corporate taxes, arguing that these taxes don't really fall on stockholders, they fall mainly on workers and consumers. Now, suddenly, the taxes fall on stockholders after all. Interesting.

Meanwhile, the Romney campaign is signalling that it's going to try to spin this as "he pays lots of taxes"! How stupid do they think we are? Actually, don't answer that.

Again, the point here is not that Romney did something wrong by paying the low rates current tax law lavishes on people like him. It is, instead, that in an election campaign that will be in part about issues of inequality, the likely GOP candidate is a living, breathing, coupon-clipping example of how favorable our system is to the very rich; and he also happens to be advocating policies that would greatly benefit people like him, while hurting the poor and the middle class.

PS: Yes, my tax rate is a lot higher than Romney's. And I support policies that would raise it further.