President Barack Obama’s campaign officials stepped up their criticism of Gov. Mitt Romney’s tax proposal, due out today, even as free-market economists panned Obama’s vague tax proposal also released today.
“By giving large tax cuts to millionaires, billionaires and corporations while increasing defense spending to an arbitrary level, [Romney’] budget would lead to massive increases in the deficit,” claimed a mid-day press release from Obama’s Chicago-based campaign.
The Obama campaign is trying to step on the rollout of Romney’s tax-plan, and last night quickly scheduled a morning press conference for Treasury Secretary Timothy Geithner to describe the president’s rival tax proposal.
Obama followed with early afternoon statement, which declared that “it is time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America.”
The framework Obama announced Wednesday will allow him to claim on the campaign trail that he is working to prevent the outflow of U.S. jobs overseas, to spur U.S. manufacturing, eliminate unfair loopholes and invest in promising technology, including wind-power.
The president’s plan will also give Democrats a set of media talking points to counter Romney’s plan as soon as it is released.
Geithner’s rushed press event came one day after White House press secretary Jay Carney told reporters Feb. 21 that the framework would be released sometime during the next two weeks. “I do not have specifics for you, but we will release the corporate reform — corporate tax reform proposal before the end of the month,” he said.
On Feb. 22, Carney denied any political motivation for the sudden release of Obama’s tax framework. “We’ve kept to that [Feb. 21] schedule,” he said. “Perhaps others are timing their announcement around ours.”
The framework sketched out Wednesday by Geithner calls for a slight reduction in the corporate tax rate, which would take the top business tax rate from 35 to 28 percent, and provide manufacturing firms with a special 25 percent tax rate. The Obama plan calls for the elimination of many business tax breaks and urges tax breaks for favored sectors, including the renewable energy-sector.
The framework “gives a good description of the problems in the current [tax] system,” but would continue to impose government priorities on business in a fashion that would skew investments away from their most efficient patterns, said Alan Viard, an economist at the American Enterprise Institute.
“The President’s plan appears to address the root cause of the problem: the corporate tax rate needs to be lowered, some tax loopholes need to be eliminated, and the base needs to be broadened,” said Jason Fichtner, a researcher at George Mason University’s Mercatus Center. But the Obama plan’s emphasis on taxing overseas investment by U.S. companies would push domestic firms overseas, drive up prices for American consumers and reduce our nation’s overall economic competitiveness, he said.
The mid-day memo follows a Jan. 21 paper criticizing the tax plans offered by Romney and Sen. Rick Santorum. However today’s release follows the campaign’s pattern of focusing their ire on Romney.
Since Obama’s election, he has added $5 trillion to the national deficit and kept unemployment at record levels.