For the issues running up to November in Current Affairs, we’re going to be taking a thorough look at the US Elections. Last time we took a look at the candidates for Vice Presidents. This time Becky Waugh talks about that speech, and why Mitt Romney should be taking more notice of the 47%.

 

As the U.S. Presidential election inches ever closer, President Obama and Candidate Mitt Romney seem to be trying to draw clear divisions between their viewpoints. This effort was somewhat helped along by the dueling exposures of controversial comments by both candidates which were not intended for public consumption during the campaign. In Romney’s case, left-leaning publication Mother Jones released secretly videotaped footage of Romney at a private campaign fundraiser; speaking candidly with high-dollar supporters Romney stated in reference to Obama that ‘there are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims’. Romney’s statistic refers to the nearly 47% of Americans who pay no federal income tax.

Obama seems to be dealing with his own tempest in a teapot this week, with the release of a 1998 era video in which Obama says in reference to wealth ‘I actually believe in redistribution, at least at a certain level to make sure that everybody’s got a shot’. Romney’s campaign quickly emphasized his difference of opinion, responding to Obama’s comments ‘I disagree’. Given that graduated income tax, in which high earners pay a greater percentage of their wealth in taxes, is a key facilitator of government benefits programs, it appears that wealth distribution had become the hot campaign topic that week for both candidates.

So far, Romney’s campaign seems to have been more greatly damaged by negative media coverage of this issue than the Obama campaign. Polling averages this week from the top 12 polling outfits show Romney trailing Obama 45% to 48.5% in head to head contest. Three and a half percent is hardly a huge deficit, and Romney may easily rebound with seven weeks left to the campaign. However, Romney’s campaign has reason to be worried about potential fallout amongst still undecided voters.

Amongst party-affiliated voters Romney’s comments changed few opinions, with Obama supporters generally liking Romney less after hearing the comments and Romney supporters liking Romney more. However, amongst crucial independent (non-party affiliated) voters who are less wedded to any particular candidate and often determine the elections, 29% said that Romney’s comments would make them less likely to vote for him and only 15% would be more likely to vote for him, with the rest saying the comments made no difference.

Romney’s comments may hurt more because many Americans tend to agree with Obama that some wealth distribution in the form of higher taxes for richer Americans and at least some social safety net is a good thing. However, Romney’s comments rest on several inaccurate assumptions about this ‘forty seven percent’. Many of those who do not pay income tax are either older retirees who no longer work or young middle-class or working-class families taking advantage of tax breaks. These demographics might hardly view themselves as dependents or victims, and older people in general are actually more likely to vote Republican than Democrat.

Even amongst those who really are dependent on the state, voting allegiances are less than cut-and-dry. Voting patterns reveal the somewhat less than intuitive result that those more reliant on the federal government may actually be more likely to vote Republican. In 2009, 17.6% of all personal income in the U.S. was derived from various government benefits, according to the New York Times. However, a state-by-state breakdown of these benefits shows that large areas of the American South and South West, the same areas that generally vote overwhelmingly Republican, depend on government programs for 30-40% of average personal income.

Finally, Romney’s comments may bring unwelcome attention back to his own spectacular wealth and the differences between his circumstances and those of the average American. Many Americans who do not pay income tax do contribute a payroll tax of 15.3% of their work income. In contrast, Romney estimates that he pays a roughly 15% tax rate due to differences in the way his income is structured.

The issues raised by Romney and Obama’s comments seem likely to remain important throughout the seven weeks until Election Day. The views of whoever will become the next president of the United States on taxes, wealth and government debt levels, will help shape the American economy, and perhaps even the global economy, for the next several years.

 

Becky Waugh

 

Image credit- Gage Skidmore