The REALITY of Mitt Romney's "budget plan" and policies - DEEP recessionSubmitted by Ian56 on Wed, 10/10/2012 - 08:36
The REALITY of Mitt Romney's tax plans & policies
The reality of Romney's tax plans and policies in squeezing the middle classes and the true wealth creating small and medium sized businesses would be a deep recession.
Romney would favor large corporations over small/medium businesses squeezing them even harder.
Whilst a large multinational might (and currently does) pay circa 10% or less in US Corporation tax, the revenue from the 30-35% corporation taxes on small/medium businesses would decline along with their profits.
Under Romney the deficit would SOAR, there WOULD BE a significant recession, unemployment would go up significantly along with the cost of welfare payments to the poor.
To make Romney's budget work you need an average of 5%+ GDP growth for 20+ years.
Trend growth for the US for the last 60 years or so has been about 3%.
But this ignores above par growth in the 80's and 90's due to massive monetary inflation (see Appendix 1) which is now being unwound.
Real GDP growth since GW Bush was inaugurated in January 2001 to end of 2011 has averaged less than 2% http://www.indexmundi.com/g/g.aspx?c=us&v=66
Romney plans on closing $700bn p.a. of tax loopholes by 2022 but he won't name a single one - they would disproportionately affect the middle classes.
Of course the biggest tax loopholes will NOT be closed.
Carried interest - which makes Romney personal tax bill so low.
The Double Norwegian which allows US multinationals to book profits offshore to avoid paying US corporation tax,
The Ryan plan would of course allow Romney to have a personal tax rate of less than 1%.
Which would save Romney around $90m on his personal tax bill over an 8 year term.
Even Romney does not sniff at getting paid over $10m p.a.
Then of course there would be all the favors shown to Bain Capital.
Romney would tell Bain which sort of companies to buy and then issue lucrative government contracts, probably at hugely inflated prices, to those Bain companies.
That would probably make Romney more than the $10m p.a. he would make on his personal tax bill.”
Mitt Romney's vision of America
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More details on the Romney/Ryan "budget plans".
US money supply growth 1950 to 2012
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Despite massive monetary easing by the Federal Reserve since the housing bubble collapsed in 2007/8, US money supply has remained static.
The reason for this is that over indebtedness of the public and corporations is being paid off or liquidated.
(The government is borrowing more than ever.)
It will take a very long time to pay down this debt, probably 20 years plus, before trend growth rates can resume once again in the US.
A massive tsunami of economic woes is about to land on America's shores from Europe's over indebtedness.
Europe is America's largest export market.