Times are getting even tougher for the floundering Obama campaign. On the heels of a poor showing in the debate against Mitt Romney, President Obama is being called out for stretching the truth that a recent study shows that, in order to finance his tax plan, Mitt Romney will have to raise taxes on middle class Americans. The worst part is that he is being called out by one of the authors of the study itself.
The Obama Campaign send out a press release to the media on Sunday, saying:
“Harvard economist Martin Feldstein and Princeton economist Harvey Rosen both concede that paying for Romney’s tax cuts would require large tax increases on families making between $100,000 and $200,000,”
Yet, truth be told, Princeton economist Harvey Rosen and Martin Feldstein didn’t look at families making between $100,000 and $200,000. They looked at families making $100,000 and then took a second group of people making just over $200,000, yet the second group contained the first group. Rosen did not separate the two for the purposes of the study.
Rosen sent an e-mail to the Weekly Standard saying that he felt the Obama Campaign misrepresented his paper not just on a micro level but in a broader context also.
Rosen’s e-mail said:
“I can’t tell exactly how the Obama campaign reached that characterization of my work.”
Rosen’s paper came to the conclusion that Romney’s tax plan would have to collect more than $81 billion dollars from families making more than $100,000 per year in order to work. The paper did not say whether those families would actually have to pay a higher tax rate.
Rosen’s paper says that it is possible that Romney’s tax plan could work, but it requires an assumption that the tax cuts would lead to significant economic growth, which has typically not happened when taxes on the mega wealthy are cut. Economists have pointed out that, when President Reagan cut taxes on the rich, there was growth but not significant growth. Additionally, economic growth slowed after President George W. Bush cut taxes on the wealthy.
Many analysts have said that Romney’s tax plan would need to raise taxes on middle class families in order to be mathematically possible but Rosen’s analysis would need to separate middle class families and rich families to be included in that group.