Thursday, October 4, 2012

The Debate: Part 4

Obama's response:

1. Starts with a little bit of criticism of Romney changing his tax plan. Which is not fair, since Romney has continued to say that he would reduce deductions and close loopholes.

2. "So at the same time that my tax plan has already lowered taxes for 98 percent of families, I also lowered taxes for small business 18 times." 

Linked to PolitiFact's statements on Obama lowering taxes.  But Obama has only done 17, at last check.  Also, letting the Bush tax cuts expire might affect small businesses negatively.  But, as we see in this article by PolitiFact, "only 0.5 percent of small businesses reported a profit in excess of $1 million."  I'm not sure what the percentage would be for those making $250,000 or more.  But my assumption based on that fact, is it's not going to be very high.

3. "But I have said that for incomes over $250,000 a year that we should go back to the rates that we had when Bill Clinton was President, when we created 23 million new jobs." 

Actually, it would be higher.  He's referring to going back to the 39.6% tax rate.  There's also an increase in taxes from the Affordable Care Act.  There's a 3.8% tax on unearned investment income.  There's also a 0.9% surcharge on top of the current Medicare payroll tax for incomes over $200,000 for single and $250,000 for family.

4. "  But under Governor Romney's definition, there are a whole bunch of millionaires and billionaires who are small businesses. Donald Trump is a small business "


Romney's response:

1. Another appeal to pity about a business owner in St. Louis.

2. Romney doesn't want to cost jobs....we get it.

3. Then more talk about lowering taxes but getting rid of deductions and exemptions, without mentioning which ones he'll use.

Obama's response:

1. "The approach that Governor Romney is talking about is the same sales pitch that was made in 2001 and 2003. And we ended up with the slowest job growth in 50 years."

George W. Bush in his first term had a growth rate of 0.51%. Lowest since FDR.  In his second term, it went to -0.84%. Is Bush completely to blame?  Probably not.  I mean, we had a global recession.  It's challenging to decide who to blame for the recession.  To compare, Obama's so far is 0.84%.  Not great or anything. But, it's consistent with historical data that shows that Democratic presidents have created more jobs than Republican presidents since World War II. 

2.  "Bill Clinton tried the approach that I'm talking about. We created 23 million new jobs. We went from deficit to surplus. And businesses did very well."

3. Obama came off as a jerk for saying, let's move on, but let me get the last word in real quick before we do.

But Clinton never had to spend stimulus money to stimulate the economy.

Romney's response:

1.  Romney was a jerk in return. We can't move on, let me get the last word in, here.

2.  "My plan is to bring down rates but also bring down deductions and exemptions and credits at the same time, so the revenue stays in, but that we bring down rates to get more people working."

You're correct with that. But as FactCheck notes, "in theory, at least, Romney’s revenue-neutral rate cuts would have even less of a stimulative effect than Bush’s cuts did."  In case you were wondering,  with Bush's tax cuts, real GDP grew by 3 percent for two of his eight years in office.  Romney's underlying assumption about his tax rates will work if it has a 3% growth in GDP.  It's possible, Bill Clinton had a 3% growth 6 out of his 8 years.  But it was a different way of growing the economy. 

3. "We've got 23 million people out of work or stopped looking for work in this country. It's just -- we've got -- when the President took office, 32 million people on food stamps; 47 million on food stamps today; economic growth this year slower than last year; and last year slower than the year before"

Those numbers might be accurate but probably not just Barack Obama's fault.  Some of the numbers for food stamps, as reported here, earlier are somewhat George W. Bush's fault, too.  Including efforts to sign up more people.  But I want to look at economic growth.  We can look at GDP, specifically perent change.  In 2009, the GDP was -3.1 from the year before.  In 2010, it was 2.4% more.  In 2011, it was 1.8%.  So far, in 2012 we have increased it 2.0 in the first quarter and 1.3 in the second quarter. Quarter 3 will be realeased later this month.  Romney's claim is accurate, so far.

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