Under growing pressure from other GOP candidates, GOP presidential hopeful and frontrunner Mitt Romney has released some limited information about his finances this week. It turns out *gasp* that Romney has done pretty well for himself over the years. But, really, we already knew that. While we don’t know the specifics, Romney’s net worth is estimated to be northwards of $250 million. He is thought to earn close to $10 million in income per year with some speculation that the number is closer to $40 million (it’s hard to tell exactly since Romney has not released income information even while serving as Governor).
As I predicted, Romney benefits from having a number of tax-favored long term investments. I suggested that would put him roughly in the same category as Warren Buffet with respect to tax rates with Romney paying an effective tax rate close to Buffet’s 11%. This week, Romney confirmed that his effective tax rate is “about 15%.”
Let the skewering begin.
Or maybe not.
The fact is that Romney is doing exactly the same thing that you and I do: he’s taking advantage of the existing Tax Code. You wouldn’t expect him to volunteer to pay at a higher rate “just because” any more than you would volunteer to give up your own mortgage interest deduction or offer to drop a personal exemption. There is absolutely nothing in the Tax Code that requires you to legally pay more taxes than you have to.
The thing is, I want my President – no matter who it is – to either know enough about fiscal and tax policy to make smart decisions or to surround himself (or herself) with people who can make those smart decisions. Having someone who consistently makes poor decisions about their own taxes directing tax policy seems like, I don’t know, asking Newt Gingrich for relationship advice.
So if there’s anger to be had, let’s make sure it’s pointed in the right direction. It isn’t that we should be angry at Romney for taking advantage of the Tax Code as written. We should be angry at Congress for letting it happen. Tax reform should be the clamor, not torching the wealthy.
And let’s face it: historically, we’ve tended to elect wealthy presidents from Jefferson to Kennedy to Bush. And many of those attempting to throw stones right now (yes, I’m talking to you, other GOP candidates who are clearly in the 1%) are doing so in an attempt to paint success as elitist as if that’s something terrible. It’s very reminiscent of the 2008 presidential nomination race when the Democrats did the same thing, causing Jon Stewart to remark: Not only do I want an elite president, I want someone who’s embarrassingly superior to me.
Agreed. There’s a reason that we tend to vote in the Clintons and the Bushes of the world and not the equivalent of Larry the Cable Guy. Being smart and successful isn’t a bad thing.
All of that said, I’m not going to give Romney a free pass altogether. As a GOP presidential candidate, Romney, like many others favors tax policies that would benefit taxpayers like him. If there’s a criticism to be had here, it shouldn’t be that he’s benefited from the existing system but that he’s not suggesting meaningful reform. And that’s where this discussion should really be focused, isn’t it?
