North Carolina lawmakers are seeking to shift much of the state’s tax burden off its wealthiest citizens and most profitable businesses and onto its low- and middle-income residents. After initially proposing to eliminatethe state’s income tax outright, Republicans are instead introducing a flat income tax rate across all earning levels. The proposal unveiled Thursday would also expand the reach of sales taxes in the state, which hits low-income families hardest, and comes on top of the March repeal of a tax credit for 900,000 working familiesin the state.
The state’s effective tax rates already favor the rich. The North Carolina Justice Center, a progressive think tank in the state, explains that the richest one percent of tarheels pay 6.5 percent of their income in combined sales and income taxes at the state level, while the lower 80 percent of earners pay between 9 and 10 percent combined. Yet Republicans propose to give that top one percent a tax cut while hiking rates for those already paying more:
NCJC adds that the lost revenue from this plan “could be as high as $573 million” per year. Given that state law requires balanced biannual budgeting, the tax proposal is likely to force major cuts to public services if approved.
The non-partisan Tax Policy Center last month released a study showing that if Mitt Romney were to keep his promise to cut tax rates by 20 percent while still balancing the budget, he would have to raise taxes on middle class families by more than $2,000. The Romney campaign has disputed the study, saying that it will close enough loopholes to pay for its huge rate cut; however, it refuses to divulge one single loophole that would be on the chopping block.
Notably, the TPC study found that even if Romney eliminated every single loophole and deduction for wealthy taxpayers, he still couldn’t offset the revenue loss without raising taxes on the middle class. During an interview yesterday on NBC’s Meet The Press, Romney claimed that five other studies show that he could, in fact, accomplish all his budget goals:
GREGORY: So Governor, we talked last night about jobs and the economy and also the debt. And I want to begin there. You’ve called the debt and our deficit a moral crisis, and yet in addition to extending the Bush tax cuts, you want to cut tax rates an additional 20 percent. You’ve rejected a 10 to one spending ratio when it comes to spending to increasing taxes. And, yet, you want to balance the budget. The math simply doesn’t add up, does it?
MR. ROMNEY: Well, actually, it does. And the — the good news is that five different economic studies, including one at Harvard and Princeton and AEI and a couple at The Wall Street Journal all show that if we bring down our top rates and actually go across the board, bring down rates for everyone in America, but also limit deductions and exemptions for people at the high end, while you can keep the progressivity in the code, you could remain revenue neutral and you create an enormous incentive for growth in the economy.
The Romney camp hasn’t indicated exactly which fives studies their candidate was referencing, but it seems likely that they were the following. All they do is further prove that Romney would, in fact, have to raise taxes on the middle class if he were to keep his promise not to lose revenue with his tax rate reduction:
– Harvard Professor Martin Feldstein’s, which, as the Center for American Progress’ Seth Hanlon pointed out, didn’t take into account Romney’s corporate tax cut, redefined the middle class, and cherry picked numbers to overstate savings.
– Princeton Professor Harvey Rosen’s, which, as UC Berkeley economist Brad DeLong noted, says Romney’s tax cuts will cause economic growth that every other recent tax cut package has failed to deliver. “We simply do not see such supply responses in the historical record, do we?” DeLong asked.
– American Enterprise Institute’s Matt Jensen’s, who claimed that the TPC study did not take into account that Romney may eliminate “the exclusion ofinterest on state and local bonds and the exclusion of inside-buildup on life insurance vehicles.” TPC re-ran the numbers to include eliminating those deductions and found that “our main result still holds.” Another AEI tax expert said, “It’s not as if the entire philosophical approach [Romney's] pursuing is doomed…But he’s going to need to cut rates significantly less than 20 percent if he wants to honor his other goals.”
– A pair of Wall Street Journal editorials that add no newinformation and merely regurgitate right-wing talking points.
Since the TPC study first came out, the Romney campaign has flailed for a response. Romney’s effort on Meet the Press was certainly no better.
UPDATE
Feldstein is an official adviser for the Romney campaign, while Rosen worked in the administrations of both President George W. Bush and President George H.W. Bush.
A recent analysis based on the loose outlines of Mitt Romney’s proposed tax plan — which would disproportionately benefit the wealthy and corporations — found that to remain revenue neutral, as Romney insists it will, it would have to raise taxes on middle- and lower-class families. The result, the Tax Policy Center concluded, is that middle class families would see a $2,000 tax hike, and that is based on the most generous assumptions, since Romney has yet to provide specific details of the plan.
In its analysis, TPC assumed Romney would pay for the corporate tax cuts by closing loopholes in the corporate tax code, but this week, the Romney campaign said that was not the case. Instead, the campaign told TPC that “cuts in corporate tax preferences were not meant to finance the initial rate cut to 25 percent but instead would pay for a subsequent revenue-neutral set of proposals that would reduce corporate rates further and enact a territorial system.”
By taking the corporate loopholes off the table, Romney is ensuring that middle class families will see an even larger tax hike than TPC previously assumed, as Center for American Progress Action Fund Director for Fiscal Reform Seth Hanlon noted in a column published today:
The TPC authors confirm that accounting for Romney’s unpaid-for corporate tax cuts would necessitate “even larger cuts to tax expenditures [i.e. tax breaks], and correspondingly larger increases in taxes on middle- and/or lower-income taxpayers,” than their original study found.
How big? The original TPC study found that in a single year, 2015, Romney’s plan would shift at least $86 billion of the tax burden from households with incomes over $200,000 to households with incomes below that level. TPC estimates that in the same year, Romney’s unpaid-for corporate tax cuts would cost $96 billion. Therefore, the tax increases on the middle class that TPC originally estimated – at least $2,000 for families and $500 for all taxpayers with incomes under $200,000 – would likely be around twice as much if Romney’s unpaid-for corporate tax cuts are taken into account.
That’s right: according to the TPC analysis — which, again, uses the most generous assumptions to fill in the blanks Romney left in the plan — the Romney plan would raise the average middle class family’s tax rate by as much as $4,000 to finance trillions of dollars in tax cuts for the rich and corporations. That includes the cost of a transition to a tax system that not only dramatically lowers the amount corporations will pay on domestic profits, but also the amount they pay on profits earned overseas and return to the U.S. — a system that will encourage outsourcing and further stashing of profits in offshore tax havens.
Tomorrow’s Primary Election Doesn’t Matter Much — With Either Hoekstra or Durant, GOP Will Have Candidate with a Dogmatic, Out-of-the-Mainstream Ideology that Will Hurt Michigan Families
LANSING – Tomorrow’s GOP primary will finally determine whether Pete Hoekstra, an ex-Congressman who currently works at a Washington lobbying firm, or Clark Durant, a former Senate and Supreme Court candidate and currently a private school executive unlawfully collecting salary through a sham charity, has been more successful at appealing to the most out-of-the-mainstream elements of their party — and which will carry an agenda that will harm Michigan’s middle-class families into the general election.
As columnist Kyle Melinn wrote in his column last week, Hoekstra and Durant’s campaigns have been focused more on who can pander to the Tea Party the most than mounting a credible challenge to Stabenow. But starting Tuesday night, the winner will have to explain to general election voters why they support plans that would raise taxes on middle-class families, end Medicare coverage, do away with federal student loans and laws to help ensure fair pay for women. Hoekstra will also have to explain his plan to create a new government agency that would have CIA and FBI agents investigating presidential birth certificates, and Durant will need to explain his belief that public education is similar to slavery and that the income gap between the wealthy and the middle class “should be wider.”
“Clark Durant and Pete Hoekstra are two peas in the same out of touch pod,” said Mark Brewer, chair of the Michigan Democratic Party. “No matter who wins tomorrow, the Republican candidate will have an agenda that further rigs the rules for well-connected special interests, rather than fighting for middle-class families, stopping outsourcing or protecting Medicare and Social Security. Hoekstra and Durant have both made very clear they are more concerned with a severely out-of-touch ideology rather than with doing what’s right for Michigan families.”
Of the one and only GOP debate, columnist Tim Skubick agreed on Friday that Hoekstra and Durant are “peas in a pod” and ruefully explained that in their only televised debate the candidates succeeded only in displaying how similar their agenda really is.
The phrase “middle class” was not mentioned a single time by either candidate during the course of the debate.
The re-emerging right-wing myth that low-income Americans aren't paying their "fair share" in taxes relies on flawed data: a report from the Heritage Foundation highlighting the fact that nearly half of Americans pay no federal income tax. In fact, while nearly half of Americans pay little to no federal income tax, nearly three-quarters pay other federal taxes, and nearly all pay state and local taxes; Americans who pay neither income nor payroll taxes are seniors, students, people with disabilities, and others who are not part of the working population.
Conservative Media Hype Income Tax Number In A Call For "Fairness"
Fox's Jim Angle: "For Half Of The Working Population, 'Fair' Means Almost No Income Taxes At All." In a segment examining "fairness" in the tax code, Fox News chief Washington correspondent Jim Angle pointed to the fact that half of Americans pay little to no federal income taxes to criticize President Obama's call that the wealthy pay their fair share in taxes, saying that it "doesn't entirely fit with the call for fairness from the president and his aides." He added: "When the president talks about fairness, he's arguing the wealthy should pay more, not that everyone should pay something." [Fox News, Happening Now, 2/20/12]
Fox's Bret Baier: "Like Beauty, Fairness In Taxes Appears To Be Largely In The Eye Of The Beholder." Introducing a segment by Angle on Fox News' Special Report, anchor Bret Baier asked viewers whether they pay their "fair share" and said that "like beauty, fairness in taxes appears to be largely in the eye of the beholder." Angle went on to say that "the president's idea of fairness is that the wealthy should be more, not that everyone should pay something." [Fox News, Special Report, 2/20/12]
Fox Nation: "Percentage Of Americans Who Pay No Income Tax Hits 49.5..." In a post highlighting the Foundry's blog, the Fox Nation website linked to the post using the headline: "Percentage Of Americans Who Pay No Income Tax Hits 49.5...":
Big Government: "No Wonder Obama Is Being Called The 'Food Stamp President.'" In a post bearing the headline, "49.5% of Americans Pay No Federal Income Tax, Can Obama Get that Number to 51% by November?" that trumpeted Heritage's report, Andrew Breitbart's Big Government website blamed the increase on President Obama:
Under Barack Obama, the number of people not paying federal income taxes in America has officially hit 49.5%. That means almost half of America, or 151.7 million Americans, are enjoying privileges or living off benefits the other 50.5% pay for. What kind of benefits am I talking about? Almost every kind you think about.
[...]
No wonder Obama is being called the "food stamp president." [Big Government, 2/21/12]
Drudge Report: "Percentage Of Americans Who Pay No Tax Hits 49.5..." The Drudge Report linked to the Foundry's post with the headline: "Percentage of Americans who pay no tax hits 49.5...":
CBPP: Income Tax Number "Greatly Overstates The Share Of Households That Do Not Pay Any Federal Taxes." The Center on Budget and Policy Priorities wrote that the fact that nearly half of Americans don't pay any federal income tax "ignores the substantial amounts of other federal taxes -- especially the payroll tax -- that many of these households pay." CBPP continued: "As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year." [Center on Budget and Policy Priorities, 5/31/11]
CBPP: "86 Percent Of Working Households Pay More In Payroll Taxes Than In Federal Income Taxes." CBPP reported:
The reality is that the income tax is one of a number of types of taxes that individuals pay, both over the course of their lifetimes and in a given year, and it makes little sense to treat it as though it were the only one that matters. Some 86 percent of working households pay more in payroll taxes than in federal income taxes. In fact, low- and moderate-income people pay a much larger share of their incomes in federal payroll taxes than high-income people do: taxpayers in the bottom 20 percent of the income scale paid an average of 8.8 percent of their incomes in payroll taxes in 2007, compared to just 1.6 percent for taxpayers in the top 1 percent of the income distribution.
CBPP: "The Poorest Fifth Of Households As A Group Paid An Average Of 4 Percent Of Their Incomes In Federal Taxes In 2007." CBPP reported that "low-income households as a whole do, in fact, pay federal taxes," writing:
Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households' incomes are -- the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth -- those with incomes between $20,500 and $34,300 in 2007 -- paid an average of 10 percent of their incomes in federal taxes.
Even these figures understate low-income households' total tax burden, because these households also pay substantial state and local taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2010.
When all federal, state, and local taxes are taken into account, the bottom fifth of households paid 16.3 percent of their incomes in taxes, on average, in 2010. The second-poorest fifth paid 20.7 percent. [Center on Budget and Policy Priorities, 5/31/11]
Journalist David Cay Johnston: "When It Comes To State And Local Taxes, The Poor Bear A Heavier Burden Than The Rich In Every State Except Vermont." In an article outlining "a few points about taxes and the economy that you may not know," Reuters columnist David Cay Johnston, a former New York Times reporter who won the Pulitzer Prize for his reporting on the tax code, wrote:
Data from the Tax Foundation show that in 2008, the average income for the bottom half of taxpayers was $15,300.
This year the first $9,350 of income is exempt from taxes for singles and $18,700 for married couples, just slightly more than in 2008. That means millions of the poor do not make enough to owe income taxes.
But they still pay plenty of other taxes, including federal payroll taxes. Between gas taxes, sales taxes, utility taxes and other taxes, no one lives tax-free in America.
When it comes to state and local taxes, the poor bear a heavier burden than the rich in every state except Vermont, the Institute on Taxation and Economic Policy calculated from official data. In Alabama, for example, the burden on the poor is more than twice that of the top 1 percent. The one-fifth of Alabama families making less than $13,000 pay almost 11 percent of their income in state and local taxes, compared with less than 4 percent for those who make $229,000 or more. [Willamette Week, 4/13/11]
Johnston: Payroll Taxes "Are Paid Mostly By The Bottom 90 Percent Of Wage Earners." In his article on taxes and the economy, Johnston wrote:
Social Security, Medicare and unemployment insurance taxes (known as payroll taxes) are paid mostly by the bottom 90 percent of wage earners. That's because, once you reach $106,800 of income, you pay no more for Social Security, though the much smaller Medicare tax applies to all wages. Warren Buffett pays the exact same amount of Social Security taxes as someone who earns $106,800. [Willamette Week, 4/13/11]
CBPP: "Lower-Income Households Pay A Significantly Larger Share Of Their Incomes In Federal Excise Taxes" Than Do More Affluent Households. In a report on the taxes that low-income Americans pay, CBPP wrote:
The reality is that the income tax is one of a number of types of taxes that individuals pay, both over the course of their lifetimes and in a given year, and it makes little sense to treat it as though it were the only one that matters. Some 86 percent of working households pay more in payroll taxes than in federal income taxes. In fact, low- and moderate-income people pay a much larger share of their incomes in federal payroll taxes than high-income people do: taxpayers in the bottom 20 percent of the income scale paid an average of 8.8 percent of their incomes in payroll taxes in 2007, compared to just 1.6 percent for taxpayers in the top 1 percent of the income distribution.
In addition, Congressional Budget Office data show that lower-income households pay a significantly larger share of their incomes in federal excise taxes (levied on goods such as gasoline) than middle- and upper-income households do.
When all federal taxes are considered, it is clear that the overwhelming majority of Americans pay such taxes. [Center on Budget and Policy Priorities, 5/31/11]
CBPP: "The Effective Federal Income Tax Rate For The 400 Taxpayers With The Very Highest Incomes Has Declined By Nearly Half Over The Past Two Decades." A February 23, 2010, report by the Center on Budget and Policy Priorities (CBPP) found:
The effective federal income tax rate for the 400 taxpayers with the very highest incomes has declined by nearly half over the past two decades, even as their pre-tax incomes have grown five times larger, new IRS data show.
The top 400 households paid 16.6 percent of their income in federal individual income taxes in 2007, down from 30 percent in 1995. This decline works out to a tax cut of $46 million per filer in 2007, or a total of $18 billion in tax cuts for these households per year. [Center on Budget and Policy Priorities, 2/23/10]
CBPP: "Typical Middle-Class Households Face Higher Tax Rates Than Some High-Income Households." A September 20 post on the CBPP blog, Off the Charts, showed that households with an annual income of over $1 million that earn over two-thirds of their income from investments paid a lower tax rate in 2011 than most middle-income families:
[Center on Budget and Policy Priorities, Off the Charts, 9/20/11]
Congressional Research Service: "About 25 Percent Of Millionaires In The U.S. Pay Federal Taxes At Lower Effective Rates Than A Significant Portion Of Middle-Income Taxpayers." An October 12 Bloomberg article on the recent Congressional Research Service report, "Analysis of the Buffet Rule," noted:
About 25 percent of millionaires in the U.S. pay federal taxes at lower effective rates than a significant portion of middle-income taxpayers, according to a legislative analysis.
Preferential treatment of investment income and the reduced impact of payroll taxes on high earners lets about 94,500 millionaires pay taxes at a lower rate than 10.4 million "moderate-income taxpayers," representing about 10 percent of those making less than $100,000 a year, according to the report by the non-partisan Congressional Research Service dated Oct. 7.
The findings put the U.S. tax system in conflict with the so-called Buffett Rule, which says households making more than $1 million annually shouldn't pay a smaller share of their income in taxes than middle class families, says the report, which analyzed 2006 Internal Revenue Service data. [Bloomberg, 10/12/11; Congressional Research Service, 10/7/11]
For the truth about the historically low tax rates paid by the wealthiest Americans, click here
... While Their Income Has Risen By 256 Percent
CEPR Report Shows Income Of Top 1 Percent Increased 256 Percent From 1979-2006, While Lowest Quintile Saw Incomes Rise 11 Percent. From a December 2010 report released by the Center for Economic and Policy Research (CEPR):
[Center for Economic and Policy Research, December 2010]
And Most Americans Who Are Exempt From Paying Income Tax Are Not Part Of Working Population
CBPP: "Vast Majority" Of People Who Neither Pay Income Nor Payroll Taxes Are Seniors, Students, People With Disabilities, And Others. From CBPP:
Some have implied or suggested that people who do not owe federal income tax are "freeloaders" who don't have a "stake in the system" and that making them pay federal income taxes would improve the tax code. Yet the vast majority of the people who owe no federal income taxes fall into one of three categories:
Approximately 70 percent are working people who pay payroll taxes. As noted above, even the low-income households in this group pay substantial federal income taxes over time. The main options to force these people to pay federal income tax in years when their incomes are low include cutting the EITC or the Child Tax Credit, which would tend to reduce work incentives and increase child poverty and welfare use, and lowering the standard deduction or personal exemption, which could tax many low-income working families into, or deeper into, poverty.
An additional 17 percent of people who did not pay federal income taxes in 2009 are people aged 65 or older. The main option to make these individuals pay federal income tax would be to subject their Social Security benefits to taxation.
The remaining 13 percent consists largely of students, people with disabilities, the long-term unemployed, and others with very low taxable incomes.[19] To make these people pay federal income taxes, policymakers would have to tax disability, veterans', and similar benefits or make full-time students and the long-term jobless individuals borrow (or draw from any available savings) to pay taxes on their meager incomes.
Tax Policy Center: "Share Of People Who Don't Pay Income Taxes Will Likely Shrink"
Tax Policy Center: "When People's Incomes Decline So Too Does Their Income Tax."Responding to the income tax number, Tax Policy Center economist Howard Gleckman wrote that "rarely has a bit of data been so misunderstood, or so misused." He went on to explain:
So who are these folks who pay no federal income taxes? Mostly, they are people who don't make very much money. Many are elderly: Think a widow living only on Social Security benefits. Others are parents earning less than $20,000. Only about 5 percent are non-elderly households making more than $20,000.
It is no accident, btw, that the number of people not paying income tax was so high in 2009. You may have noticed that we've had a recession lately. And here is a powerful insight: When people's incomes decline so too does their income tax (at least most of the time). At the same time, many working families have benefited from temporary tax cuts aimed at boosting the economy, and as a result some did not pay income taxes last year. As the economy improves and those tax cuts expire, it should also be no surprise that the share of people who don't pay income taxes will likely shrink from half last year to less than 40 percent by 2012.
There is, however, another reason why some people don't pay. For decades, both Democratic and Republican governments have made conscious policy decisions to remove low-income working families from the income tax rolls. And, guess what, sometimes government policy works exactly as intended. That's what happened this time. [Tax Policy Center, 4/15/10]
LANSING – Michigan Democratic Party Chair Mark Brewer issued the following statement after Michigan Republican Congressmen Justin Amash (MI-3), Tim Walberg (MI-7), and Thad McCotter (MI-11) voted “no” on extending the payroll tax cut which will save the average family around $1,500 per year.
“This ‘no’ vote by these three Republican Congressmen is irresponsible and puts our economic recovery at risk. This tax cut extension was a bipartisan agreement that will benefit millions of working families throughout the country. Instead of voting to cut taxes for middle class families, Congressmen Amash, Walberg, and McCotter voted to raise them.
“They’re not representing their constituents nor the people of Michigan. Congressmen Amash, Walberg, and McCotter should be ashamed of themselves for this vote and the voters will hold them accountable at the polls in November.”
Michigan Gov. Rick Snyder (R) spent his first year in office drawing up substantial tax cuts for corporations and the wealthy while shifting the tax burden onto Michigan’s most vulnerable. In a state where the poorest 20 percent of Michiganders pay a tax rate of8.9 percent and the richest one percent pays 5.3 percent, Snyder’s tax reform plan will only make the disparity worse come fiscal 2013.
In fact, according to the Michigan League for Human Services, Snyder’s tax reforms will “hit poor families 1,000 times harder than wealthy households”:
The League released a report that says the tax plan will hit poor families 1,000 times harder than wealthy households. Families making less than $17,000 a year would pay one percent more in taxes in 2012, while families making more than $334,000 would see their taxes go up by only .001 percent, the report states.
Gilda Jacobs, president and CEO of the League, wants to see a fair tax structure that doesn’t hit the poor harder than the wealthy.
“We want to be sure that we have shared sacrifice.” she says. “If you’re making $17,000 a year, this is going cost you about $100. That’s a lot of money to these people. That’s a car payment, that’s a winter utility bill. It’s huge.”
Indeed, state revenues will now rely more heavily on the middle class as the new tax code will generate $1.4 billion more from personal income taxes while dropping nearly $2 billion in revenue from businesses. And though Snyder insists that such corporate income tax cuts are sure to create jobs, the economic evidence proves otherwise. As the Center for Budget and Policy Priorities notes, such corporate tax rates fail to produce a net short-term stimulus, tend to cause a near-term drop in in-state economic activity because corporations are unlikely to spend the full amount of the tax cut, and actually creates “little or no added incentive for corporate investment in the long run.” At best, it produces a boost in economic productivity and jobs by only 2 to 3 percent.
In a potentially game-changing shift, Republican presidential candidates, including former Utah Gov. Jon Huntsman, former House Speaker Newt Gingrich, and Texas Gov. Rick Perry, have tapped into the populist anger of the 99 percent, tearing into former Massachusetts Governor Mitt Romney’s tenure at the financial firm Bain Capital, which made billions while bankrupting a quarter of the companies it invested in.
Gingrich said Romney’s firm consisted of “rich people figuring out clever, legal ways to loot out a company;” Huntsman claimed Romney liked “firing people;” Perry said that Romney must’ve been worried that he would “run out of pink slips” to give people.
The attempt by these candidates to tap into the sentiments of Americans — many of whom are registered Republicans — who have been ripped off and mistreated by corporate executives like Romney is spawning a backlash from the Republican establishment. A number of prominent right wing individuals and groups rushed to defend Romney’s behavior at Bain Capital, saying that being critical of corporate greed is tantamount to betraying conservative values and being anti-capitalism. Here’s a roundup of just some of this conservative backlash:
– The Club for Growth: The Club for Growth called Gingrich’s critique of Bain “disgusting,” and said that “attacking Governor Romney for participating in free-market capitalism is just beyond the pale for any purported ‘Reagan conservative.’” [1/10]
– Former Pennsylvania Sen. Rick Santorum: Santorum accused those criticizing Bain of playing by the Democratic Party’s playbook: “[I] just don’t think as a conservative and someone who believes in business that we should be out there playing the games that the Democrats play, saying somehow capitalism is bad.” [1/9]
– The National Review: The National Review’s Avik Roy said the attacks on Bain were indicative of “Romney Derangement Syndrome,” and defended the practices of his company. [1/9]
– The American Spectator: The Spectator took issue with Gingrich examining the effects of Romney’s vulture capitalism: “Gingrich’s words during Saturday morning’s debate that ‘I think it’s a legitimate part of the debate to say OK on balance are people better off by this particular style of investment?’ show less an attack on Romney than attack on capitalism itself, something that should be anathema to a self-described ‘Reagan conservative.’” [1/10]
– New Hampshire Gov. John Sununu: Sununu said the critique of Bain is part of an “attack” on “free-enterprise.” “Those attacks… are on the investment community of this country,” said the New Hampshire governor. [1/10]
– The American Enterprise Institute (AEI): AEI’s James Pethokoukis wrote that firms “like Bain disrupt the status quo for the betterment of most though not all.” [1/10]
– Radio Host Glenn Beck: Beck said that Bain is the “new Halliburton” — the “company that has done nothing wrong yet is completely vilified merely for being a company that attempts to earn a profit.” [1/10]
RedState’s Erick Erickson is one high-profile Republican who is not rushing to attack Bain’s critics — but not because he views them as correct. “The typical voter does not understand private equity, leveraged balance sheets, etc. They see it as some mystical black magic abused by greedy people on Wall Street,” he explains. “There are, frankly, a lot of Republican primary voters who view it that way too.” Erickson conceded that many Republicans are just as distrustful of the financial sector as the rest of America is a powerful concession — it shows that the right-wing blogger and conservative strategist understands that economic populism can appeal even to some of the nation’s most conservative voters.
While appearing on Fox News last night, public relations guru and GOP consultant Frank Luntz said that the antidote to the economic concerns of voters isn’t necessarily to change Republican policy solutions but simply change their political language: “Conservatives should not be defending capitalism. They should be defending economic freedom.”
UPDATE
Last night, Sen. Jim DeMint (R-SC) said he’s a “little concerned about the few Republicans who have criticized some of what I consider free market principles here.”
