Romney Tracker

6-Figure Income Earners Were Middle Class in Romney's Tax Relief

By CALVIN WOODWARD
Associated Press Writer

No one in the Republican presidential race talks more about middle-class tax relief than Mitt Romney. The twist: His view of who fits into the middle class is more expansive than most.

Romney's middle class includes people making $200,000 a year, judging by the intersection of his rhetoric and tax plan.

His rhetoric:

--"We're going to have to reduce taxes on middle-income Americans immediately."

--"We must improve America's global competitiveness and unleash the American economy by rolling back tax rates across the board, eliminating taxes on middle class savings, making the Bush tax cuts permanent, lowering the corporate tax rate, making health care expenses tax deductible and eliminating the death tax once and for all."

--"Zero rate on middle class savings," he says, "to make it easier for the middle class to save."

--"They say we ought to be able to get a reduction on the burden on the middle class. And that hasn't been done."

Romney underscored the point in the South Carolina debate Thursday night, as he does in speeches and in his platform. Other GOP candidates, too, want to preserve President Bush's expiring tax cuts for people of all incomes. That inevitably saves rich people the most dollars if relieving people of moderate income of a noticeable share of their tax burden.

Nor is Romney alone in wanting to get rid of the estate tax.

But the former Massachusetts governor goes beyond that to say "anyone" with adjusted gross income under $200,000 -- that's after certain deductions -- should be relieved of all taxes on capital gains, interest and dividends, pushing his definition of the middle class well into six-figure incomes.

Democratic presidential candidates, too, can be loose in defining the middle class -- in the other direction.

They propose to pay for their expensive programs mainly by raising taxes on people making more than $200,000. But their categories of tax cuts are geared to the working poor and the elderly, even if they are couched as middle-class relief.

Illinois Sen. Barack Obama has also spoken of a tax increase on people making much less than $200,000. Specifically, he's open to raising the ceiling on the Social Security tax so people making more than $97,500 have to pay it. New York Sen. Hillary Rodham Clinton won't rule out doing the same, or something similar. Their Democratic rival, former Sen. John Edwards, would keep people making under $200,000 clear of higher payroll taxes.

Among Republicans, former Sen. Fred Thompson said in the debate that special tax relief for lower income workers might be called for at some point. More broadly, he proposes letting people choose between the current system and a 10 percent flat rate after deductions on the first $50,000 per taxpayer -- 25 percent above that.

Arkansas Gov. Mike Huckabee wants to replace income and investment taxes with a 23 percent sales tax, with cushions for the poor and for necessities.

Former New York Mayor Rudy Giuliani aims his distinctive cuts at the corporate tax, arguing that's one level of tax reduction that pays for itself, while Arizona Sen. John McCain, says Bush tax cuts he opposed at the start -- because they were not tied to spending cuts -- should be kept because everyone now counts on them.

He'd keep capital gains and dividends taxes where they are but he'd eliminate the alternative minimum tax, thereby helping rich people as well as many middle-class people being drawn into that tax.

There is no accepted standard of what constitutes the middle class.

California State economist Anil Puri says the "middle-middle class" could be understood to include households taking in $35,200 to $52,800, which is 80 percent to 120 percent of the national median income.

But he conceded that's not a perfect definition because "such middle class households cannot actually afford the middle class lifestyles."

Romney Says McCain Fails 'Reagan 101' by Opposing Tax Cuts

By GLEN JOHNSON
Associated Press Writer

Taking aim at a rallying John McCain, New Hampshire front-runner Mitt Romney said Saturday that his GOP presidential rival had failed "Reagan 101" by twice opposing President Bush's tax cuts.

Romney also sought to turn McCain's well-known maverick streak -- a central theme in his campaign ads -- against the Arizona senator. McCain's go-it-alone attitude, Romney suggested, will breed more divisiveness in Washington if he wins.

"Anyone who's run something, whether it's a small business or a big business, knows that the No. 1 ingredient for success is building a remarkable team of people around you, motivating them, guiding them, insisting on them drawing out their best capacities," Romney told a crowd of more than 100 people at an elementary school.

"I've had occasions to run business, to run the Olympics and to run a state, and you don't do that by yourself," said Romney, a former Massachusetts governor.

Taxes, a major focus in a state without an income tax, drew Romney's attention in his criticism of McCain.

"He voted against the Bush tax cuts -- twice," Romney said. "That's failing Reagan 101. (Ronald) Reagan taught ... almost all of us in the Republican Party that lowering taxes would grow the economy and was good for our economy and good for individuals. And I believe that the Republicans are going to nominate a tax-cutter to become president of the United States."

The McCain campaign did not immediately respond to a request for comment. In 2000, McCain beat Bush in the New Hampshire primary, and the two later squared off over the president's tax-cut policy.

The attacks on McCain come as the latest public opinion survey shows the lawmaker gaining on Romney, who long held double-digit leads in the state. Those questioned in the USA Today/Gallup Poll said they liked McCain for standing up for his beliefs and being in touch with average people, but Romney for having new ideas to solve problems and sharing voters' values.

Romney's criticism could open him up to a line attack about his own position on the tax cuts.

McCain was one of two Republican senators to vote against a $1.35 trillion tax cut that Bush proposed in 2001. McCain also voted against similar plans in 2003, as well as a proposed repeal of the federal estate tax. McCain said they disproportionately benefited the wealthy.

At the time of the latter votes, Romney was in his first stint in elective office, leading Massachusetts.

The Boston Globe reported that year that during a meeting in Washington with the Massachusetts congressional delegation, Romney was asked about the tax cuts and said he "won't be a cheerleader" for proposals he did not agree with. "But I have to keep a solid relationship with the White House."

Now, Romney is solidly behind the cuts, arguing they should be made permanent before they expire in 2011.

A questioner at a town hall meeting Friday night in Rochester asked Romney about his apparent change of heart. The man refused to give his name, and Romney aides surrounded him afterward and accused him of being a Massachusetts Democrat who had challenged Romney about his tax record at another event.

Romney said that his first public comments were in support of the tax cuts, and that he campaigned on behalf of Bush in 2004.

Turning back to 2003, Romney told the man: "You see, I wasn't a U.S. senator. I didn't have to vote on this, didn't get a choice to. I was running my state, so I didn't have a comment on their position. And I said, `I'm not weighing in on federal issues.' But Sen. McCain was a senator. He had to vote. He had to decide, `Am I in favor of pursuing these tax cuts or not,' and he voted against the tax cuts -- twice. That's a very different position."

Romney, Giuliani Quarrel on Taxes

By LIZ SIDOTI
Associated Press Writer

Republican presidential hopefuls Mitt Romney and Rudy Giuliani quarreled over tax and spending cuts Tuesday, each claiming greater commitment than the other in a debate in the nation's struggling manufacturing heartland.

The government "is spending money of future generations and those yet to be born," added Fred Thompson, making his debut on a debate stage after a late entry into the race. He said future retirees should receive smaller Social Security benefits than they have been promised.

After months of polite debate sparring, Giuliani and Romney squared off without hesitation, a reflection of their struggle for primacy in the race for their party's presidential nomination.

"I cut taxes 23 times. I believe in tax cuts," said Giuliani, former mayor of New York and leader in national Republican polls.

Romney initially conceded that, but quickly criticized his rival for once filing a court challenge to a law that gave President Clinton the right to veto spending items line by line. "I'm in favor of the line-item veto," he said, adding he exercised it 844 times while governor of Massachusetts.

Romney also said that while mayor, Giuliani "fought to keep the commuter tax, which is a very substantial tax ... on consumers coming into New York."

The former governor leads his rivals in the polls in Iowa, where caucuses will be the first contest of the campaign, and he and Giuliani are in a close race in surveys in New Hampshire, the leadoff primary state.

Giuliani responded that spending fell in New York while he was mayor, and rose in Massachusetts while Romney was governor.

"The point is that you've got to control taxes. I did it, he didn't. ... I led, he lagged."

"It's baloney," retorted Romney. "I did not increase taxes in Massachusetts. I lowered taxes."

The exchange was among the most heated of the campaign for the Republican presidential nomination, reflecting a quickening pace as the 2008 caucuses and primaries draw close.

It also left Thompson, Sen. John McCain of Arizona and the other contenders as something of bystanders for the several moments that Romney and Giuliani went at one another.

All nine of the men on stage sought to stress their conservative economic credentials throughout the two-hour debate, held in the city that gave birth to the Ford Motor Co. more than a century ago.

McCain of Arizona said President Bush was right to veto a children's health expansion bill, and he urged him to reject a multibillion-dollar public works measure as well.

"We've got to get wasteful spending under control," he said.

"We have to get spending under control," agreed Kansas Sen. Sam Brownback. No matter whether Republicans or Democrats are in control of Congress, he said, "the system is built to spend."

Challenged to identify one government account he would cut, Brownback cited a program involving "advanced technology."

"If you want to control federal spending you must look at Social Security and Medicare," said Rep. Tom Tancredo of Colorado. He said he favors private Social Security accounts, or "forget the idea of ending deficit spending."

Thompson said that without changes, Social Security would not survive. He said there should be no change for current retirees and those expected to begin drawing benefits soon. But for those retiring further in the future, benefits should not be allowed to rise as quickly as now expected.

While maneuvering against one another, the Republicans found a minute or two to jab at Democrats.

Giuliani criticized Sen. Hillary Rodham Clinton, the Democratic presidential front-runner, for a proposal to provide tax cuts of up to $1,000 to help families open 401(k) retirement accounts.

"Hillary is filled with endless ways to spend. We're going to have to control that," he said.

Romney criticized Michigan Gov. Jennifer Granholm for raising taxes, and drew laughter when he said he was afraid she "was going to put a tax on this debate."

Eight of the candidates support the continuing U.S. military presence in Iraq, but Rep. Ron Paul of Texas drew applause when he loudly dissented. Paul posted a surprising $5 million in campaign donations for the three months ending Sept. 30.

By decision of the debate's producers, the first question of the event went to Thompson, making his first appearance with rivals who have been campaigning for months. He stood between Romney and Giuliani.

He said the economy is strong, with no threat of a recession in the immediate future.

Former Arkansas Gov. Mike Huckabee said not everyone was well off.

"I want to make sure people understand that for many people on this stage the economy's doing terrifically well, but for a lot of Americans it's not doing so well. The people who handle the bags and make the beds at our hotels and serve the food, many of them are having to work two jobs," he said.

Romney said it was inexcusable that Michigan was in what he called a one-state recession, with high unemployment. He said the president must have an open door policy when it comes to the auto industry.

Thompson drew a good-humored jab at one point, when Romney likened the ongoing series of Republican debates to "Law & Order," the television program that helped Thompson establish his acting credentials.

"It's got a huge cast, the series goes on forever and Fred Thompson shows up at the end," he said.

"And to think I was going to be the best actor on stage," replied Thompson with a smile.

After fielding the first question, Thompson also drew the last. Asked whether he had waited too long to join the race, he said he had not, then joked he had watched the earlier debates. "It was getting a little boring without me," he said.

Romney Hammers Anti-Tax Message

By PHILIP ELLIOTT
Associated Press Writer

Republican presidential hopeful Mitt Romney on Saturday promoted his anti-tax credentials while taking on rival Rudy Giuliani and Democrats over taxes and spending.

Romney boasted of his accomplishments as Massachusetts' governor and criticized Giuliani for his legal challenge to a law that allowed presidents to reject specific spending items in the federal budget.

As New York's mayor, Giuliani "went all the way to the Supreme Court to eliminate the line-item veto," said Romney, who used such an option 844 times in his state -- a fact highlighted in a new direct mail campaign.

Giuliani challenged the law in 1997 because it stopped $200 million intended for New York. The former federal prosecutor successfully argued that the power can only come through a constitutional amendment. Giuliani supports the idea of the line-item veto and has promised to seek an amendment that would allow it.

At the presidential level, the line-item veto was short lived. Congress passed it in 1996, President Clinton used it in 1997, and the Supreme Court struck it down as unconstitutional in 1998.

Giuliani spokesman Jeff Grappone had no immediate comment Saturday to Romney's comments, instead citing former Massachusetts Gov. Paul Cellucci's defense of the ex-mayor last week.

Cellucci told reporters in a conference call arranged by the Giuliani campaign Thursday to respond to Romney's tax and spending charges that the criticism amounted to "pretty weak arguments from a governor who in four years really had no tax cuts for the people of Massachusetts."

Romney, a multimillionaire and former venture capitalist, cites his fiscal record as an important selling point for his candidacy.

"I cut out of the budget over $425 million in spending I thought the state couldn't afford," Romney said of his final budget as governor. He left office with a $2 billion rainy-day fund.

"We need to have someone in Washington who will keep spending down so our country's future remains bright and prosperous," he said. "I want to make it very clear to you that I will absolutely keep our taxes down and lower taxes."

Romney also said Democrats would be poor stewards of federal spending.

"They want to run the largest enterprise in the world. ... It employs millions of people, it has trillions of dollars in budget. They want to run this large enterprise and the key to the future of this enterprise is going to be the strength of our economy," Romney said. "Yet not one of them has ever run anything in the economy."

Romney Ad: Pledge Not to Raise Taxes

By PHILIP ELLIOTT
Associated Press Writer

Republican presidential hopeful Mitt Romney planned to continue hammering his rivals on Friday, starting a new radio ad in New Hampshire that touts his promise not to raise taxes.

Romney, who has seen his polling lead in New Hampshire evaporate in recent months, reminds voters in his new 60-second ad that he has signed a pledge not to raise taxes.

"For years, conservative candidates for president signed their name on the dotted line, pledging to oppose tax increases," Romney says in the ad that starts on Friday. "I'm proud to be the only major candidate for president to sign the tax pledge. The others have not."

The ads come after back-to-back days of trading jabs between Romney and fellow GOP candidate Rudy Giuliani. The pair spent Thursday in a sharp exchange over their tax and spending records.

In Romney's new ad, he notes he signed the no-taxes pledge because voters deserve to know where he stands -- and, by contrast, where former New York Mayor Rudy Giuliani and Sen. John McCain do not.

"We've got to get taxes down. And grow our economy," Romney says. "I believe it's not fair that you have to pay taxes when you earn your money, when you save your money and when you die.

"I stood firm to roll back taxes as governor. I'll roll back taxes as president," says Romney, who was unable to cut taxes while leading Massachusetts.

Giuliani's anti-tax statements are a centerpiece on the campaign trail. At every opportunity, he lets voters know he cut taxes 23 times as mayor. Giuliani's critics note that he opposed some of those tax cuts, and others on the tally were initiated by the state -- not the city -- of New York.

Romney's anti-tax stance doesn't exactly mesh with his 2002 record. In that year, his spokesman called such pledges "government by gimmickry." His critics also note taxes and fees in Massachusetts went up about $700 million.

"No amount of political spin can help Mitt Romney re-write the history books," Giuliani spokeswoman Katie Levinson said. "Mitt Romney can repackage himself as many times as he wants but his failing fiscal record speaks for itself."

Romney Hits Giuliani on Line-Item Veto

By GLEN JOHNSON
Associated Press Writer

Mitt Romney criticized GOP presidential rival Rudy Giuliani Thursday for fighting as New York's mayor to eliminate a presidential line-item veto and to maintain a commuter tax on visitors to New York City.

Romney said those actions highlighted his own differences with Giuliani over government spending and taxation, pivotal questions in New Hampshire, a state that has no income tax and prides itself on its bare-bones government.

Romney is the former governor of neighboring Massachusetts. Giuliani has begun to challenge Romney's lead in early voting New Hampshire, and the Romney campaign has been portraying the Republican race as a two-man contest with the former New York mayor.

"I don't think there's any tool more important than the line-item veto," Romney told a man at St. Anselm College who asked him to contrast himself with Giuliani on tax and spending policy. "I line-item-veteoed hundreds of items as governor of Massachusetts, hundreds, and that vehicle is the most powerful tool a president of the United States could have to rein in unnecessary pork barrel, earmarked spending."

One of Romney's predecessors, former Massachusetts Gov. Paul Cellucci, later told reporters in a conference call arranged by the Giuliani camp that the criticism "appears to be some desperation as the polls close," as well as "pretty weak arguments from a governor who in four years really had no tax cuts for the people of Massachusetts."

Cellucci said Giuliani supports a line-item veto as one of his 12 commitments.

The line-item veto law was the only major provision of the 1994 Republican "Contract with America" campaign that Clinton endorsed. In 1997, Giuliani filed a lawsuit challenging Clinton's use of the line-item veto, fearing its impact on the ability of the city and New York state to raise taxes on hospitals and use the money to attract federal Medicaid payments.

A year later, the Supreme Court found the line-item veto unconstitutional.

"Because he won, he killed the line-item veto," Romney said of Giuliani, calling the former mayor's action "a serious mistake."

On the commuter tax, Romney noted that Giuliani challenged then-Gov. George Pataki, a fellow Republican, when Pataki tried to eliminate New York City's commuter tax, which levied a 0.45 percent income tax on those working in New York City. The tax had existed for decades, and at the time of its repeal added about $500 million to city coffers.

Giuliani opposed the repeal of the tax, suggesting it was designed to help win a state legislature election in a suburb outside of the city. Giuliani said he was putting the city first.

Romney said: "Can you imagine what would have happened up here in New Hampshire if I, as governor of Massachusetts, said everybody who commutes to Massachusetts has got to pay an extra special tax as a commuter? It just seems absolutely wrong."

The commuter tax eventually was repealed.

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Associated Press Writer Devlin Barrett in Washington contributed to this report.

Romney Plan Would Eliminate Some Taxes

Republican presidential candidate Mitt Romney is filling in the blanks in his proposal to eliminate taxes on interest and dividends for families earning less than $200,000 a year.

A former business executive and Massachusetts governor, Romney said the plan would benefit 95 percent of American families -- 56 million that earned interest in 2005, 28 million that earned dividends and 23 million with capital gains from real estate, stocks or bonds.

Romney, who previously has talked about his desire to eliminate such taxes, said the plan would encourage saving. He was explaining the details during an appearance Friday in New Hampshire.

"You're creating a dramatic new incentive to save, which is savings will be tax free. ... Your interest, dividends and capital gains will be tax-free, which will allow people to establish pretty substantial nest eggs," said Romney, who previewed his speech in a telephone interview Thursday with The Associated Press.

"Any tax reduction means more money in our pockets to invest in our country, and tax reductions stimulate our economy in general," he said.

Romney spokesman Eric Fehrnstrom, said the proposal would cost $32 billion, to be paid for through economic growth, and by holding non-defense discretionary spending to inflation minus 1 percentage point.

Romney has focused on economic issues during the campaign and especially in New Hampshire, where anti-tax sentiment has kept away a statewide income tax.

Earlier this year, he proposed restoring the three-fifths majority requirement for Congress to raise taxes, and he routinely pledges to fight new taxes. He said the new proposal would further help taxpayers.

"It's a dramatic simplification of the tax process because you're not going to have to worry about the basis of each asset and how long you held it and so forth. So you simplify taxes," Romney said. "Most importantly, you let people save, and save for whatever purpose they like."

Romney said the plan would "help middle class folks save for retirement, for homes, for anything they like -- and to stimulate economic investment and growth."

With the mortgage industry facing serious troubles and borrowers finding it harder to get loans, more savings would help, he said.

Romney said the proposal grew out of a a mealtime conversation with his sons, when he asked how many of them were saving for retirement through a 401(k) or a Roth IRA.

"I looked around the table and no one's hand went up. It's like, 'Why don't you have these things?'" he said.

He said the government makes saving difficult by threatening people with financial penalties for tapping their retirement accounts before they turn 65. He said his plan will help people save "without having to sign up for these nanny accounts."

Romney, a multimillionaire venture capitalist, said the plan would not help people like him.

"There may be some tax policies which tend to favor the highest tax payers. This is certainly not one of them," he said. "It is entirely targeted at middle-income and modest-income Americans, allowing the great bulk of our citizens -- 95 percent of our citizens -- to be able to save their income, tax free," he said.

Romney's top rivals also have weighed in on tax policy.

Former New York Mayor Rudy Giuliani has pledged to kill the so-called "marriage penalty" and "death tax." Arizona Sen. John McCain has spoken in support of President Bush's tax cuts. He also supported requiring a three-fifths majority vote for Congress to raise taxes, repealing the alternative minimum tax and flattening the tax structure.

By contrast, Democratic candidate John Edwards has proposed raising capital gains rates on families making more than $250,000 a year to 28 percent. He would tax dividends at 39.6 percent, the rate during the Clinton administration.