Institute for America's Future co-director Robert Borosage appeared on the Tavis Smiley Show on October 31 to discuss the tax and economic policies advanced by Republican presidential candidates and their impact on middle- and low-income people.
He calls the flat-tax proposals of candidates Rick Perry and Herman Cain, as well as the regressive tax changes offered by candidate Mitt Romney, “reverse Robin Hood plans” that take from the poor in terms of reduced government services and higher taxes, and give to the rich in the form of a lower overall tax burden. These plans come “at a time in which we're seeing extreme inequality and concentrated wealth we haven't seen since before the Great Depression.”
The flat-tax plans are particularly egregious, Borosage tells Smiley. In the case of Perry, his plan “eliminates taxes on wealth” and slashes government revenues by $5 trillion over 10 years, a deficit that has to be made up by a 25 percent cut in government spending, including “deep cuts in the basic promises we make to working Americans about their retirement.”
Cain's plan “is the worst,” Borosage says, because it would among other things impose a 9 percent national sales tax on top of the state and local taxes people pay on consumer goods. Because the lower the income a person makes the higher the percentage of that income is devoted to spending on consumer items, that means the Cain plan would fall the hardest on low-income and middle-income people.
Borosage also raises concerns about “a financialization of our economy that is having really disastrous effects on … our ability to ensure that the strength of our democracy, which is a strong middle class, is sustained.” Smiley responds, “It's not just that our economy is challenged by those kinds of numbers, but it's democracy as we know it. Some people might call that hyperbolic, but I don't. … I don't think the democracy can sustain itself long term with the kind of numbers you just laid out.”