Arlen Specter’s death last week at age 82 got me thinking of my own career in politics, which began with a summer internship at the senator’s office in Harrisburg, Pennsylvania. All I remember, frankly, is xeroxing some newspaper articles. That’s because I quit a week later to earn big bucks pumping gas and peddling dried-out fried chicken parts at a roadside convenience store.
I didn’t make much money that year — in fact, I made so little that I didn’t have to pay income taxes. You might say I was part of the “47 percent.”
On the cusp of the second presidential debate, the political world waits for President Barack Obama to lower the boom on Gov. Mitt Romney for his “47 percent” comments, made at a fundraiser in May. The media turned the remarks into a shorthand for callous indifference to the plight of the average American.
Of course, they had a lot to work with. Romney told the wealthy donors that nearly half the people are “dependent upon government,” “believe that they are victims,” and do not “take personal responsibility” for their lives. He added, “My job is not to worry about those people.” Whatever “compassionate conservatism” was, this was the opposite. (“Severe conservatism”?)
To his credit, Romney realized this. “In this case, I said something that’s just completely wrong,” he told Fox News. “This whole campaign is about the 100 percent.”
Romney’s fundamental mistake was conflating the universe of Obama voters — about 47 percent — with the universe of adults who effectively pay no income taxes — also 47 percent. A Venn diagram of the two would find some overlap, but not overwhelmingly so.
That’s because the latter category includes senior citizens, who have consistently favored Romney in polls. It also includes military veterans, combat soldiers, persons on disability assistance — heck, even unpaid lay clergy of the Church of Latter-Day Saints.
The more immediate concern for Romney is how to handle the inevitable debate attack. Should he go on offense or defense? Apologize or stand firm? Make a self-deprecating joke or go high dudgeon on Obama?
Romney, too, has plenty of material to work with. Fewer Americans are working today than when Obama was inaugurated. Worse, “while the job losses during the recession were concentrated in mid-wage occupations, the subsequent employment gains continue to come heavily in low-paying jobs,” reported the National Employment Law Project. (Some recovery.)
There’s more. Median household income has fallen to the lowest level since 1995, according to the U.S. Census Bureau. More Americans are qualifying for food stamps and disability aid than are finding new work. And the poverty rate is at a two-decade high.
In other words, the Obama Administration is manufacturing millions more Americans who will not earn enough to pay income taxes. “Why are these people non-taxpayers today? Because the economy sucks,” said Ryan Ellis, Director of Tax Policy for the Grover Norquist-led Americans for Tax Reform. “I think that’s what [Romney] is going to say, and should say.”
Many factors keep (or push) people in the 47 percent camp. One is the Earned Income Tax Credit (EITC), whose payments have grown by 50 percent since 2002.
Ellis pointed out that the EITC was based on a conservative idea developed by Milton Friedman called the “negative income tax.” It was designed to reward workers whose annual wages fell below the poverty line with a guaranteed income supplement.
Friedman envisioned it as a replacement for wealth redistribution policies, such as welfare and food stamps. But Washington turned it into another “add-on” anti-poverty program. Nevertheless, it was promoted by Republican and Democratic presidents alike; President Ronald Reagan called the EITC “the best anti-poverty, the best pro-family, the best job creation measure to come out of Congress.”
In recent years, however, a split has emerged. South Carolina Sen. Jim DeMint has recommended eliminating the EITC and child tax credit for those who earn too little to qualify for federal income taxes. “Poverty has gone up in America,” DeMint told McClatchy Newspapers in December. “We have trained several generations of Americans to be dependent on government rather than trying to get them off welfare.”
And Rush Limbaugh on Monday urged Romney not to apologize. “There are a lot of people who agreed with him when he made the comments about the 47 percent,” said Limbaugh. “That’s, to use a cliché, the dirty little secret here.”
Despite their unified stance on cutting taxes, Republicans have been a cacophonous chorus when it comes to the “how.” Some favor a simple “flat tax” that treats all incomes the same. Even the liberal Specter pushed a flat tax during his 1996 campaign for president. Others back a national sales tax to replace the income tax, which — given Washington’s attitude and appetite — would only happen if the 16th Amendment to the U.S. Constitution were repealed. Otherwise, it would become just another federal “add-on.”
For his part, Gov. Romney has proposed a permanent 20 percent across-the-board tax cut, the elimination of the death tax and Alternative Minimum Tax (AMT), and a cut in the corporate tax rate, currently the world’s second-highest.
“So what I do is I bring down the tax rates, lower deductions and exemptions,” Romney said during the first debate, “the same idea behind Bowles-Simpson.”
Both Obama and Romney have offered tactical praise for the Simpson-Bowles deficit-cutting plan, in part to show their bipartisan bona fides. But the ATR’s Ellis warns it is not tax revenue-neutral: “Compared to the historical baseline, the first ten years of Simpson-Bowles would result in a $5 trillion tax increase.”
None of these thorny tax issues will be resolved by one debate. But Romney’s “47 percent” problem can be. He must first remind voters of the sorry state of the economy and its impact on average Americans. Then he must win their trust as the man who can fix it. After all, as I can attest, it’s a lot better to get 52 checks from an employer than one from the IRS.
John K. Herr is a speechwriter and standup comedian. He has written for three Governors and four Cabinet secretaries, and served in the White House under two Presidents. His standup act has taken him to numerous states and cities, including Las Vegas for the World Series of Comedy. Herr also wrote jokes for former President George W. Bush. Follow him on Twitter: @jherricane.