) -- Nothing taxes the credibility of politicians like their promises and claims about taxes, and President Obama and Gov. Romney top the list for testing the credulity of voters.

Federal finances are a wreck. Spending exceeds taxes by some 50%, and deficits have surpassed $1 trillion four years running.

Mr. Obama and other Democrats blame Bush-era tax cuts and two wars not adequately financed, but that's inaccurate.

In 2007, with the Bush tax cuts in place and two wars raging, the deficit was only $161 billion. Since then, federal spending and the deficit have increased dramatically, mostly on new entitlements, more regulatory bureaucracy, and industrial policies -- for example, aid to auto companies to develop gems like the


Volt and alternative energy companies like



Additional outlays exceed what is required to keep pace with inflation by $726 billion, and but for bigger government, the deficit would be less than half its current size.

Now the president tells us he wants to cut taxes for regular folks and raise them for rich people to continue investing in America. After losing a quarter of the government's investment in


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and all its cash in Solyndra, perhaps he should give electric cars and blue-sky energy projects a rest.

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Importantly, raising taxes on wealthy Americans and closing loopholes would only slice about 10% or 15% from the deficit. With nearly 50% of Americans paying no income taxes, to cut the deficit in half, the President would have to increase the taxes paid by everyone else by 50% -- including the waitress earning $10 an hour, struggling working families, and oh yes, Warren Buffett, who says his tax rate is lower than his secretary's.

This brings me to the real rub. The family that earns $250,000 to $1 million a year and is headed by two professionals or small-business owners is not the problem. Many of these folks already over 25% to 30% of their income in federal income taxes.

Rather, it's investors like Mr. Buffett, private equity partners who earn their money wheeling and dealing, high-tech entrepreneurs, Wall Street bankers and corporate executives who get paid in stock options that get tax rates that are about half what professional families and small-business owners pay.

Repeatedly, President Obama and other Democrats harp about fixing the provisions that let America's aristocracy off easy but never get it done. No doubt, campaign fundraising in Silicon Valley, on Wall Street, and among industry executives benefiting from the president's industrial policies is a distraction.

Gov. Romney promises to cut income and corporate tax rates across the board and eliminate taxes imposed by the Affordable Care Act -- all financed by closing loopholes and special breaks totaling nearly $500 billion.

Considering that the combined federal take from personal and corporate income taxes is about $1.4 trillion, his strategy requires eliminating the middle class's most cherished benefits -- including the deductibility of mortgage interest and local property taxes -- and ending the "carried interest" provision and rules for stock options. Those latter gems permit private equity partners, like him, and corporate executives to pay much lower taxes than many ordinary folks -- even some school teachers.

Hardly a believable plan!

In 2011, Governor Romney paid about 14% on an income of $13.7 million. That's half of what the owner of a luncheonette, working alongside his wife 80 hours a week, can expect to pay.

Mr. Romney is vague -- nay, obtuse -- about which loopholes he would close, and the carried interest and similar provisions are never even whispered.

For sure, whoever is elected, tax rules that permit wealthy folks like Warren Buffet and Mitt Romney to pay half the rate that small businesses and many others pay will continue -- and continue to be abused.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Professor Peter Morici, of the Robert H. Smith School of Business at the University of Maryland, is a recognized expert on economic policy and international economics. Prior to joining the university, he served as director of the Office of Economics at the U.S. International Trade Commission. He is the author of 18 books and monographs and has published widely in leading public policy and business journals, including the Harvard Business Review and Foreign Policy. Morici has lectured and offered executive programs at more than 100 institutions, including Columbia University, the Harvard Business School and Oxford University. His views are frequently featured on CNN, CBS, BBC, FOX, ABC, CNBC, NPR, NPB and national broadcast networks around the world.