3. Feldstein
Harvard economist Martin Feldstein has defended the Romney plan in two articles (see citations). His approach differs from Rosen and Entin/McBride in that he relies on historical evidence that taxable income will rise rather than a growth simulation that implies increased revenue.
In defending his claim of increased taxable income Feldstein mentions both micro-dynamic and macro-dynamic. In the former category he mentions
"receiving more of their compensation in the form of taxable cash rather than untaxed fringe benefits, and spending less of their income on tax-favored forms of consumption that are deducted or excluded in calculating taxable income". In the macro-dynamic category he mentions increased work effort.
The TPC claims to have taken account of micro-dynamic effects in their model. One of the TPC authors has argued that the reducing tax concessions would have an offsetting micro-dynamic effect on revenue by people moving out of assets now subject to more tax. This is added as an opposing argument to this node.
The taxable income boost, in conjunction with other assumptions of Feldstein - especially his setting of the high-income threshold at $100,000 rather than $200,000 - makes achievement of the Romney objectives (other than no extra burden below $200,000) feasible. The point about the high-income threshold has been made by several authors and is dealt with elsewhere in this graph - follow cross-link to the main argument.