The National Memo did the math, so that you don’t have to (and because Romney won’t).
Last night, Mitt Romney promised to eliminate our $1.3 trillion annual deficit without raising any taxes. How will he do this? First, reduce deductions for the wealthy. Well, that’s only $165 billion if you eliminate all deductions for the wealthy. The rest of the money? His answer was to grow the economy so that more people are earning money, and thus paying taxes.
Sounds great! So let’s work the math out. Romney said he would add 12 million new jobs over the next four years. If those jobs pay an average of $40,000/year and pay 20% in federal taxes, that will provide $96 billion in additional revenue.
We’re still not close to $1.3 trillion. And that’s not counting the additional money Romney wants to spend on the military, or the $713 billion Romney wants to give to the health insurance companies via Medicare.
So how much would those new jobs have to pay in order to generate enough revenue to eliminate the deficit? On average, those new jobs would have to pay $433,333/year, each.
I see the problem — to Romney that’s a typical middle class salary!
Or let’s look at it another way. If we go back to assuming that those jobs pay $40,000/year, how many jobs would we have to create to eliminate the deficit? Romney would somehow need to create 162.5 million new jobs. That means more than doubling the total number of jobs in the US.
4 Comments
From what I heard in the debate it sounds to me as working class people need to get some “skin into the game” by reducing deductions. Romney doesn’t actually say which deductions will be cut, so my opinion is based on the “47%” remarks, and past rants on Fox.
DAMN THE MATHEMATICS, FULL SPEED AHEAD TO WONDERLAND WITH ALICE!
Yes, and 162.5 million jobs is easy to accomplish!. If each of them worked three jobs, we’d need only 54.17 million people to fill them all!. Of course, not being able to sleep might impair their job performance somewhat. Maybe they can catch up on the weekends.
I know! Let’s give jobs to illegal immigrants—we are being overrun with them anyway and we can always get more. Or we could repeal the child labor laws (which repeal is probably buried in the Republican platform somewhere) and put the 8-year-olds back to work. And there will be more kids anyway because of the Repugnant’s stance on birth control. You don’t want to spend money on schools for them so put them to work! And eliminate retirement—-you work until you die on the job—-then your body can be sent down to the local (privately owned) power plant and burned along with all that dirty coal to generate electricity (and profits for some plutocrat). Does that sound too much “Nazi-ish” and even offensive? I apologize but it perhaps does so because it’s pointing to the kind of corporate fascism that the Republicans and the rich want to impose on the 99% It will perhaps be more benign that what happened in Germany but will be fascism nonetheless.
I had seen a similar analysis that went further, assuming economic growth was not just the jobs (and the 12M he claimed) but that we looked at total GDP and assumed net revenues remained identical (which is also impossible). With that in mind, to balance the budget assuming DRASTIC spending cuts in all discretionary spending other than education and defense (which he said he would not touch) Romney would have to have the economy expand at just over 8% per year every year for 4 full years.
The only problem with that assumption is that it has NEVER HAPPENED. And in order for it TO happen, it pre-supposes some new industry(ies) that produce something that can only be made in the US, has a high margin, and will be consumed by virtually every country on the planet. And I can’t even imagine what that would be, but I can tell you for sure it won’t happen next year.
So the math just doesn’t add up. No matter how hard you try, it doesn’t work.
So the Romney “smaller slice of a bigger pie” solution is using a pie in the sky.
Net revenues as a percentage, meaning no actual tax burden reduction for anyone – even though both Romney and Obama have said we need to reduce corporate taxes.