We all know that Paul Ryan’s budget would be a disaster for people of color. The bad news is that Mitt Romney’s plan is even worse, twice as bad in fact. A middle-of-the-road analysis by the non-partisan Center on Budget Policy and Priorities (CBPP) concludes that Governor Romney’s budget proposal would require $10 trillion in cuts vs. Ryan’s $5 trillion. The unimaginable size and speed of his rollback would fall hardest and fastest on those that can least afford it.
Blacks and Latinos–with depression-level unemployment and the lowest level of wealth in these communities on record–would struggle to endure this catastrophic slash and burn scheme. Romney’s plan, unleashed during the worst recession in almost a hundred years, would take the present desperate situation to a place that’s difficult to imagine. Yesterday’s poverty report only underscores the point.
The core danger in Romney’s blueprint is that it would remove an average of $1.2 trillion in direct government spending from GDP every year for eight years, and would do so in order to fund massive tax breaks for the wealthy. The ensuing economic calamity would toss the country back into dangerous territory. Romney admitted as much in a May interview with Time’s Mark Halperin, "If you take a trillion dollars for instance, out the first year of the federal budget…that is by definition throwing us into recession or depression."
In an attempt to entice his party’s pro-corporate, anti-government base, Romney’s proposals risk America’s future.
Mitt’s Plan
As the CBPP points out, Romney’s budget plan has four cornerstones: 1) reduce federal spending by almost 20 percent; 2) increase defense spending by close to 40 percent; 3) slash taxes; and 4) balance the budget.
According to the CBPP, Romney’s budget would cut Medicare by $2 trillion; reduce Medicaid by $1.4 trillion; eliminate another $2 trillion in "a wide variety of public services" including education, environmental protection and law enforcement; "throw 13 million low-income people off the (food stamp) benefit rolls"; and shrink payments to disabled veterans by 25 percent.
Consequently, Romney targets programs that: 1) people of color and the elderly rely on for healthcare: 2) feed one out of six Americans, and 3) provide a ladder of opportunity through education, housing, and public transportation. Just as ominously, the plan would weaken the foundation for future growth with cuts in infrastructure and scientific research.
The former governor’s massive reductions are driven by his proposal’s eye-popping $5 trillion in tax cuts. These tax cuts shrink government revenues and vastly increase the hole that his overall plan has to fill. Specifically, Romney wants to reduce the top tax rate for high earners, bring down taxes on money earned on investments, zero out taxes on inheritances over $5 million, and lower the corporate tax rate by almost 30 percent.
Analysis from Seth Hanlon at the Center for American Progress concludes that one top Romney donor, Sheldon Adelson would "receive a potential tax cut from the Romney tax agenda of more than $2 billion."
At the same time that Romney hobbles the government’s ability to bring in money through the front door, his budget brusquely shovels it out the backdoor. Romney wants to jack up defense spending, and give the Pentagon $2 trillion more than it’s requested. According to the Center for Responsive Politics, Lockheed Martin, the largest defense contractor and one of the largest contributors to political campaigns in Washington, gives almost two-thirds of its political donations to the Republican Party.
Has Already Been Tried
If this one-two punch of giant tax cuts and huge defense increases sounds familiar, it is.
Ronald Reagan rolled out this formula in the1980s. By the time he left office, the federal debt was three times larger than when he arrived. In 2001, George W. Bush latched on to Reganomics and took it further. The tax cuts which bear his name, along with two unfunded wars, added another $5 trillion to the tab, and increased the actual debt by 90 percent. Romney wants to try to solve the current crisis by using the very tools that created it.
Romney’s plan requires extreme reductions in order to skew benefits towards wealthy Americans and corporations. But over 90 percent of all wage gains in recent years were garnered by the top 1 percent. Companies are sitting on $2 trillion in unspent profits. Romney’s budget adds to these inequities through crony capitalist giveaways to the defense industry.
At their core, Romney’s priorities assert that the few should have more, and that the rest of us should pay for it. He basically wants to take the Bain Way and nationalize it. As Rupert Murdoch said in a Tweet this week, Romney "must offer (a) specific path to restore (the) American dream." Sadly, what he’s offering now would shatter it.