Romney's February Surprise: Massive 20% Income Tax Cuts Across-the-Board

[Politico]

This is why the jmfcsts should get behind Romney. This proposal was held back, but now is the time. And we'll gut federal government spending at the same time, to help balance the budget before the end of his first term, if the Republicans regain the Senate. Romney believes the American taxpayer can spend their income better than Big Government "Washington Knows What's Best For You" Republicrats:

Mitt Romney called for a 20 percent across-the-board cut in individual income tax rates today as part of an effort by his campaign to turn the focus of the Republican presidential primaries back to economic issues.

Romney’s plan would lower the top tax rate to 28 percent for individuals from 35 percent now, cut corporate taxes to 25 percent from 35 percent, eliminate the estate tax and scrap the alternative minimum tax. It also would limit the deductions, exemptions and credits that are currently available to higher- income Americans.

“We are going to cut back on that so we make sure the top 1 percent keeps paying, paying the current share they’re paying or more,” Romney told a campaign rally in Chandler, Arizona. “We want middle-income Americans to be the place we focus our help, because it’s middle-income Americans that have been hurt by this Obama economy.”

To offset the cuts and reduce the federal budget deficit, Romney said he’d trim $500 billion in spending by 2016.

Speaking in Arizona this morning, Romney said Obama’s plan would raise taxes on small businesses that pay personal income tax rates rather than corporate taxes. Many small businesses -- and some large ones -- pay taxes on their profits on their individual tax returns.

“President Obama’s plan is to raise taxes on those enterprises,” he told voters gathered in a high school gym. “My plan is to lower them by 20 percent.”

Source: http://www.bloomberg.com/news/2012-02-20/romney-focuses-on-economy-while-stumping-for-votes-cash-in-ohio.html

[Politico]

Do you think this tax tack by Mittens is a good public policy idea Politico?

Only if it is matched by massive transferring of spending to the states coupled with spending cuts, as I anticipate. There is no choice but to get the deficit under control. I really believe Romney can cut federal taxes, move a lot of spending onto the states (who can decide what stays and what goes), and cut the true waste. It is probably doable. If not, we'll cut taxes less than 20%, but still cut them as much as possible. The optimization goal is to minimize taxes and spending given our various constraints.

[Politico]

Do you think this tax tack by Mittens is a good public policy idea Politico?

Only if it is matched by massive transferring of spending to the states coupled with spending cuts, as I anticipate. There is no choice but to get the deficit under control. I really believe Romney can cut federal taxes, move a lot of spending onto the states (who can decide what stays and what goes), and cut the true waste. It is probably doable. If not, we'll cut taxes less than 20%, but still cut them as much as possible. The optimization goal is to minimize taxes and spending given our various constraints.

So the cut in Fed taxes is matched by an increase in state taxes, causing a further Balkanization of the US?

Well, it will likely mean an increase in state taxes if you live in heavily Democratic states (I feel your pain, Torie), but other states, swing and Republican states, will choose different courses (i.e., cut what is deemed superfluous). Perhaps this will cause Democratic states to become more anti-tax moving forward, of course.

Let's face it: Moving whatever spending can be moved onto the states is the only way to force out what people really don't want to pay for due to the fact states have to balance their budget whereas the federal government does not. It's really the best thing to do to get the federal deficit under control, and eventually our debt load too. Have the federal government commit to defense/federal law enforcement spending, various federal courts with regards to law/order, social security/medicare (obviously the minimum age for those born after 1964 will need to be pushed up to 70 eventually), and some scientific/technological research especially with regards to defense and space exploration (e.g., NASA). With regards to a bunch of other stuff, outside the broadly outlined scope, allow the 50 states to compete with one another. The best models will eventually win. Furthermore, people who want to live in Amerisweden can live in an Amerisweden state, and people who want to live free or die can live in a live free or die state. It is a lot easier to enact change one way or the other with decentralization.