Former Sen. Mitt Romney, R-Utah, said in a New York Times opinion piece that rich people should pay more taxes through a reformed tax code.
Romney, the 2012 Republican presidential nominee, warned that the government is headed for a fiscal cliff.
"If, as projected, the Social Security Trust Fund runs out in the 2034 fiscal year, benefits will be cut by about 23%," he wrote.
"The government will need trillions of dollars to make up the shortfall," Romney added.
"When lenders refuse to provide the money unless they are paid much higher interest rates, economic calamity will almost certainly ensue," he said.
Romney said both higher taxes, which Democrats often propose, and lower spending, which Republicans call for, are both necessary.
The former Utah senator and Massachusetts governor said one entitlement reform would be making Social Security and Medicare benefits means-tested, while the starting age for entitlement payments should be linked to American life expectancy.
"And on the tax front, it's time for rich people like me to pay more," Romney said.
"I long opposed increasing the income level on which FICA employment taxes are applied," he added. "No longer; the consequences of the cliff have changed my mind."
Romney called for reforming the tax code, closing loopholes such as capital gains not being taxed at death.
"This unusual provision makes sense when you're talking about helping families keep their family farms," Romney wrote.
"But it's used by billionaires to avoid capital gains taxes. To raise more revenue, this cavern should be sealed for mega-estates over $100 million," he added.
Another idea Romney said should be explored are 1031 exchanges, which allow a real estate developer to defer and possibly avoid paying the capital gains tax on the profitable sale of a building.
"I presume these provisions were originally intended to stimulate the real estate industry," Romney said. "Today, they insulate multibillionaires."
"I believe in free enterprise, and I believe all Americans should be able to strive for financial success," he added. "But we have reached a point where any mix of solutions to our nation's economic problems is going to involve the wealthiest Americans' contributing more."
"If my party wants to be the one to give working- and middle-class Americans greater opportunity — to be the party that is trying to restore some sense of confidence in our capitalist system — this would be a start," Romney continued.
Sam Barron ✉
Sam Barron has almost two decades of experience covering a wide range of topics including politics, crime and business.
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