Paul Ryan's plan is a path to prosperity for Mitt Romney


Under Paul Ryan's plan, Mitt Romney wouldn't pay any taxes for the next ten years -- or any of the years after that. Now, do I know that that's true. Yes, I'm certain.

Well, maybe not quite nothing. In 2010 -- the only year we have seen a full return from him -- Romney would have paid an effective tax rate of around 0.82 percent under the Ryan plan, rather than the 13.9 percent he actually did. How would someone with more than $21 million in taxable income pay so little? Well, the vast majority of Romney's income came from capital gains, interest, and dividends. And Ryan wants to eliminate all taxes on capital gains, interest and dividends. 



But what about corporate taxes? Aren't they a double tax on savings and investment, so Romney's "real" rate is higher than his headline rate? No. As Jared Bernstein of the Center on Budget and Policy Priorities has pointed out, Romney has structured his investments as "pass-throughs" that avoid corporate tax. In other words, the 0.82 percent tax rate is really a 0.82 percent tax rate.

It might seem impossible to fund the government when the super-rich pay no taxes. That is accurate. Ryan would actually raise taxes on the bottom 30 percent of earners, according to the nonpartisan Tax Policy Center, but that hardly fills the revenue hole he would create. The solution? All but eliminate all government outside of Social Security and defense -- a point my colleague Derek Thompson has made in incredible chart form.

Maybe Harry Reid's mysterious source that Romney didn't pay taxes for a decade was really a time-traveler from the future. If Romney wins, it could very well be true.