As Brian notes below, here’s what Mitt Romney had to say about his effective tax rate today:
“What’s the effective rate I’ve been paying? It’s probably closer to the 15 percent rate than anything. Because my last 10 years, I’ve—my income comes overwhelmingly from some investments made in the past, whether ordinary income or earned annually. I got a little bit of income from my book, but I gave that all away. And then I get speakers fees from time to time, but not very much.”
I’ve already heard a lot of chatter from politicos that fallout from this comment, and continuing pressure on Romney to release his tax returns, are going to make the Bain attacks look like so many slaps with a wet noodle.
I’m not so sure. I doubt Romney’s reluctance to release his returns is due to his not wanting voters to find out he’s rich. The game is up on that one. I suspect it’s more like there are some line items that could be politically exploitable — think John Kerry’s boat or John McCain’s many houses. And if it’s true pays an effective rate near 15 percent, that doesn’t strike me as particularly damning either, considering the average effective income tax rate in this country is 11.08%.
In fact, I think Romney has a pretty good story to tell about the ways he has and has not put food on the table, especially in contrast to President Obama. Romney can point out that President Obama became a millionaire while in elected office, and largely on the strength of his memoir (including $70 grand in sales to the State Department while in the Oval Office), while Romney made his money in the business world, took no salary as governor of Massachusetts or head of the Olympics, and donated the proceeds from his book (along with millions more, as Romney tithes) to charity. Romney has also said he would donate his federal salary if elected president, and could go one better were he to commit to, say, asking all executive appointees of means to work gratis.
Romney can even roll the fact that pays most of his taxes at the capital gains rate into his proposal to eliminate those taxes for the “middle class.” “I’ve been lucky enough to enjoy positive returns from my investments and I want every working Americans to be able to do the same” yadda yadda. Regardless of the policy wisdom of a selective elimination of savings and investment taxes, it makes for good politics. He can be a kind of Republican analogue to Warren Buffett. Not “please raise my taxes” but “I’ll cut yours by more.”
Again, I don’t see anything in Romney’s latest comment, or in what we know already know his net worth and income history, that can be effectively used as a cudgel. Fact is, with the exception of Joe Biden — whose at time negative net worth I’ve always found sort of endearing — we tend to wind up with millionaires on our tickets. Nothing new there.