Ad Watch: A look at Obama's attacks on Romney's tax and Medicare stances
President Barack Obama is airing two television commercials that accuse Republican Mitt Romney of endorsing policies that would raise taxes on the middle class and increase the out-of-pocket costs of Medicare.
The PolitiFact network has fact-checked statements that are similar or identical to those made in the commercials. Here’s a summary of the findings.
Ad Claim: "To pay for huge tax breaks for millionaires like him, Romney would have to raise taxes on the middle class -- $2,000 for a family with children, says a nonpartisan report."
Facts: Generally speaking, Romney’s plan would lower tax rates for everyone while getting rid of exemptions, deductions and loopholes. That way, people would pay lower tax rates, but more income would be subject to taxes, so the changes wouldn’t blow a hole in the deficit.
Other ideas from Romney’s tax plan: eliminating interest, dividend and capital gains taxes for taxpayers earning less than $200,000; eliminating the estate tax; repealing the Alternative Minimum Tax; and cutting the 35 percent corporate rate to 25 percent.
Romney has said he wants to keep tax rates low on savings and investment, which tend to benefit the millionaires. But he’s also said that people at the high end "will still pay the same share of the tax burden they’re paying now," which suggests he wants to maintain the current progressive system where people pay more taxes as a percentage of income if they make more.
The sticking point is that Romney hasn’t specified what exemptions, deductions and loopholes he wants to get rid of. So it’s impossible to tell if Romney’s math adds up.
An August study by the nonpartisan Tax Policy Center concluded that, under the broad parameters Romney has set forth, the bottom-line tax bill for middle-class families would rise by about $2,000 in 2015. That’s because the loss of deductions for middle-class families would outweigh the gain of paying a lower tax rate, according to the research.
In contrast, the study concluded that wealthy families would see their tax bills go down because the benefit of paying lower rates would outweigh their loss of deductions.
Romney has disputed the findings, saying the Tax Policy Center made invalid assumptions about how he will fashion his tax plan.
Ad Claim: Under the Romney plan, "You could lose your deduction for your home mortgage, health care"
Facts: Romney, again, has not said what deductions he wants to eliminate. The biggest tax break to individuals is not having to pay taxes on their employers’ contributions to their personal health care and health insurance premiums, worth $132 billion a year. The popular mortgage interest deduction is worth about $97 billion annually.
Ad Claim: Romney’s Medicare plan "could raise seniors’ costs up to $6,400 a year.
Facts: This is a misleading claim because it relies on an analysis of an outdated Republican plan.
GOP vice presidential candidate Paul Ryan made an unsuccessful proposal early last year that that would have changed Medicare from a program that pays doctors and hospitals fees to one in which beneficiaries would be paid an amount by the government that they could use to buy private insurance. The change would have affected people under 55.
The liberal Center on Budget and Policy Priorities -- drawing on data from the Congressional Budget Office -- estimated that Ryan’s plan in 2022 would cost seniors $6,350 in added out-of-pocket costs over what they would have paid for traditional Medicare benefits. The Keyser Family Foundation projected the difference to be $6,870.
But a new plan by Ryan has two key differences from his original proposal: 1) It would give beneficiaries under 55 a choice — they could use their government payment to buy private insurance or a plan that acts like traditional Medicare and; 2) It is slightly more generous than the first plan in allowing the government subsidy for premiums to increase as health care costs rise.
Romney has said he is largely in accord with Ryan’s most recent plan. The proposal has not been analyzed by the CBO, and there is no data available on how it would affect seniors’ out-of-pocket medical costs.