Saturday Reads: Mitt Romney’s Religion, Politics, and Taxes

Good Morning!!

Everyone is still talking about Mitt Rommey’s taxes and his struggling campaign. I have some interesting reads on those subjects, but first I want to all attention to a story from The Daily Beast yesterday by Jamie Reno that I think deserves more attention. The Mormon church in Florida is threatening to excommmunicate one of their prominent members who has written some negative on-line articles about Mitt Romney.

David Twede, 47, a scientist, novelist, and fifth-generation Mormon, is managing editor of MormonThink.com, an online magazine produced largely by members of the Mormon Church that welcomes scholarly debate about the religion’s history from both critics and true believers.

A Mormon in good standing, Twede has never been disciplined by Latter Day Saints leadership. But it now appears his days as a Mormon may be numbered because of a series of articles he wrote this past week that were critical of Mitt Romney.

On Sunday, Twede says his bishop, stake president, and two church executives brought him into Florida Mormon church offices in Orlando and interrogated him for nearly an hour about his writings, telling him, “Cease and desist, Brother Twede.”

Twede posted the letter he received from his stake president on his blog, Prozacville. His excommunication hearing “for apostasy” is to take place September 30. Twede wasn’t using his real name on-line, but the church learned his identity from someone at a pro-Mormon website, Foundation for Apologetic Information and Research.

So apparently the Mormon church is not as neutral in this election as it has claimed. In fact, ABC News recently reported that the church has been working to get Mormons registered in swing state Nevada.

In a provocative move within a religious organization that has sought to display strict political neutrality, an official of the Mormon church has disseminated a presentation across the key swing state of Nevada that urges members to vote and speak “with one voice” in the coming Presidential election that pits Mormon Mitt Romney against President Barack Obama.

“Any Mormon would understand exactly what’s being said there,” said Randall Balmer, a Dartmouth religion professor who has studied the church’s handling of Romney’s presidential bids. “This is very thinly coded language.”

Personally, I think this is very creepy. The church seems to be quite involved in this election–trying to encourage votes for Romney and at the same time attempting to silence critics of the prominent Mormon candidate.

If the Romney campaign was hoping that releasing Mitt’s 2011 tax returns along with a vague “summary” of his returns for the past 20 years, they will be disappointed. Most tax experts aren’t buying the “summary,” and lots of them are trying to figure out exactly what Romney is trying to pull this time.

I thought this piece in USA Today by Rick Newman was very helpful (h/t Dakinikat). Newman reads between the lines of the official release and finds some oddities. First, somehow $7.2 million disappeared from Romney’s income between January when he filed an estimate and now on his official return.

Between January and October of this year, Romney’s adjusted gross income for 2011 fell by $7.2 million. And it dropped by nearly $8 million compared with his AGI in 2010. His federal tax liability also fell, by similar proportions.

The most likely explanation is that Romney’s accountants transferred income from Romney’s personal return to one of the three trusts that also generate considerable income, almost all of it from investments. It will take a detailed examination of the 2010 and 2011 documents to figure out what changed, but here’s a clue: Romney’s campaign has begun to focus on the “personal” tax rate paid by Romney, rather than the tax rate that might be associated with the trusts and his total income from all sources.

Newman also notes that the Romney representatives are emphasizing the word “personal” when they refer to Romney’s tax returns, suggesting that some kind of fudging is going on.

Romney hasn’t released tax documents prior to 2010, but some tax experts think his overall tax rate could have been very close to zero during at least a couple of years, possibly because of capital losses suffered during the stock-market wipeout of 2008, which zeroed out earnings for many investors.

The Romney campaign now says that since 1990, “the lowest annual effective federal personal tax rate” Romney paid was 13.66 percent. In other words, the rate on what might be characterized as his personal income never fell below that threshold.

But that doesn’t account for the three trusts, or other investment vehicles that may have existed prior to 2010. And it’s unusual to limit the claim to “personal” taxes when Romney has acknowledged other types of income. So it’s possible that the effective tax rate on the trusts was very low at some point—and maybe even zero, which would have indicated a net loss for the year.

Greg Sargent talked to another expert, Roberton Williams, of the Tax Policy Center, about the 20-year summary and Romney’s claim that “Over the entire 20-year period, the average annual effective federal tax rate was 20.20%.” Sargent learned from the campaign that this represents an average of Romney’s tax rates over the 20 year period.

Williams tells me that this is a far less meaningful way to calculate the overall rate than the second way, which actually calculates the real tax rate Romney paid over the period.

Here’s why: The first way obscures the fact that income may have fluctuated quite markedly from year to year. If Romney paid his lowest rates in a number of the higher income years, the overall 20 percent figure would overstate the rate he actually paid over the whole period. Williams provided the following purely hypothetical example:

“Let’s say you have 10 years in which you paid 13 percent in taxes, and 10 years in which you paid 27 percent,” Williams told me. “If you average those rates, you’ll get an overall rate of 20 percent. But if the 13 percent years were high income years, and the 27 percent years were low income years, then his total taxes paid as a share of total income over the 20 years would be less, perhaps significantly less, than 20 percent.”

Yet in that scenario, the Romney campaign would be claiming, by its chosen metric, to have paid 20 percent.

This is very troubling, and I’m sure more detailed analyses will be coming. You have to wonder why Romney didn’t just keep stonewalling instead of raising lots more questions about his taxes.

There have been lots of stories this week about what Romney should do to rescue his flailing campaign, but the candidate himself says there no problem. At least that’s what he told Scott Pelley of CBS’ 60 Minutes.

Scott Pelley: You are slipping in the polls at this moment. A lot of Republicans are concerned about this campaign. You bill yourself as a turnaround artist. How are you going to turn this campaign around?

Mitt Romney: Well, actually, we’re tied in the polls. We’re all within the margin of error. We bounce aroun — week to week– day to day. There are some days we’re up. There are some days we’re down. We go forward with my message, that this is a time to reinvigorate the American economy, not by expanding government and raising taxes on people, but instead by making sure government encourages entrepreneurship and innovation and gets the private sector hiring again.

Scott Pelley: Governor, I appreciate your message very much. But that wasn’t precisely the question. You’re the CEO of this campaign. A lot of Republicans would like to know, a lot of your donors would like to know, how do you turn this thing around? You’ve got a little more than six weeks. What do you do?

Mitt Romney: Well, it doesn’t need a turnaround. We’ve got a campaign which is tied with an incumbent president to the United States.

Scott Pelley: Well– as you know, a lot of people were concerned about the video of the fundraiser in which you talked about the 47 percent of the American people who don’t pay taxes. Peggy Noonan, a very well-known conservative columnist, said that it was an example of this campaign being incompetent. And I wonder if any of that criticism gets through to you and whether you’re concerned about it at all….

Mitt Romney: I’ve got a very effective campaign. It’s doing a very good job. But not everything I say is elegant. And I want to make it very clear, I want to help 100 percent of the American people.

In non-political news, yesterday was the 75th anniversary of the publication of J.R.R. Tolkien’s The Hobbit. Corey Olson has written a history of Tolkien’s beloved book. Check it out at The Daily Beast. It’s quite interesting.

It’s getting late and I need to get this post up, so I’ll end there.

What are you reading and blogging about today?