good evening, everyone. i'm erin burnett. out front tonight, tax war. two respected experts wrote an op-ed that the obama campaign immediately seized on it. it was enough to prompt them to send this e-mail to their troops, subject line romney's role in tax shelter raises questions. the reason? the op-ed written by two experts who recently wrote another article critical of romney's personal tax strategies says since romney refuses to release his tax returns, his views on taxes are revealed by what did he while on the audit committee of marriott corporation. i'll explain what happened, but first let's just lay out the key accusation. the authors say, quote, a key troubling public manifestation of romney's apparent incense tivety different to tax obligations is his role in marriott international's abusive tax shelter acvity. so does the accusation of insensitivity, translation, lack of ethics, add up? romney was chief for a while of the audit committee from 1993 to 1998. in that role, he would have been responsible for overseeing the company's tax returns. during his tenure, marriott was accused of using a tax scream called son of boss. we reached out to marriott and are still awaiting their response. but in court documents, they have denied the claims. big shot tax attorneys and investment bankers love to give their complicated tax creations catchy names and this one son of boss does sound like the mafia shelter that it was. it was called son of boss and it set up various structures beneath other structures. basically to move money around. it could turn a gain into a loss and of course that mean it is can offset gains and bottom line you don't pay taxes. the tax code is 7300 pages long for a reason. because if you can read them all, you can legally come up with ways to minimize your tax bill. but son of boss was over the line. the irs took years to court and won. and even though marriott denies doing anything wrong, they had to pay up for what they did. only in the irs has gotten $3.2 billion from back taxes from more than 1800 people who used son of boss. marriott international was one of the biggest offenders, eventually paying more than $29 million in back taxes. that puts them really in the top. the biggest offender was one company which paid $100 million. now, critics of son of boss actually include john mccain who called it a hoax and scam back in 2004 and said, quote, one of the greatest beneficiaries of this tax shelter, and that is all that it is, a tax shelter, is a very profitable hotel chain, marriott. and he's not alone in his criticism. we called in our tax strike team to get their view on this. daniel shaviro told us that son of boss was the most abusive in u.s. history. tax shelter. but he did note something really important. at the time, it was a big more ambiguous because after all, when you think about the '90s, these were the days of enron's rise and they were the master of tax shelters. they all ended up being a joke and causing a massive crisis, but at the time, it looked like they worked. they were in vogue. so here is the bottom line. it is fair to hold mitt romney accountable for marriott's use of an abusive tax shelter while he was chairman of the audit committee. and it is fair to say that romney knows a lot about what's right and wrong with tax shelters. as he himself says. >> i don't pay more than legally due and, frankly, if i had paid more than are legally due, i don't think i'd be qualified to become president. >> all right. but here's our original question. ask does the accusation that romney's sign off on son of boss is a troubling public manifestation of romney's apparent sensitivity. to what is right. does it add up to a personal ethical reflection? we asked the romney campaign to come out front tonight so they could answer these serious questions directly. they declined. joining me now is steve moore head of the editorial board and great to see both of you. judd, so let me start with you. is it fair to take what happened while he was the head of the audit committee at marriott, a terrible tax shelter which at the time may have been more ambiguous, and say this is a reflection of his personal ethics and personal taxes? >> well, i do think it's fair. and the reason why, mitt romney has put his business career both in bain and all the boards he served on, the various companies he advised, really at the center of this campaign and with that, you have to take the good and you also have to take the bad. so i think the whole reason you are on a board of directors is to exercise your judgment and to be a good steward of the stockholders' money if it's a public company like in this case. and i think that absolutely this is something that he should be held responsible and really plays into the larger questions about both his personal finances and his conduct as a business executive. >> it's interesting, steve, that marty sullivan, another tax expert on our strike team said many years before he even new romney had anything to do with marriott, marriott had a reputation for aggressive tax planning. which is true. they had synthetic fuel transactions. so he comes in, so the audit committee presides over these tax shelters. is it fair? >> well, first of all, i think it's very interesting that the obama administration would accuse anybody of not paying their taxes. let's not forget half of the cabinet that obama appointed back in 2008 had tax problems including by the way the current treasury secretary. look, i think this issue -- i have to say this, i think this issue for the lefts what the birther issue was for the right. all of these unsubstantiated allegations about an issue that most people don't really care about. and this idea that somehow that he's guilty until proven innocent unless he releases his tax returns. it's really crucial -- >> but steve, your own editorial page said he should release the taxes. i mean, it's -- this comes from the right, these calls, too. >> that's because we think he should clear his name of this. but that's his personal prerogative whether he does or doesn't. but on this issue of the son of boss and marriott, look, there's a big difference between tax evasion, which is a crime, and tax avoidance and tax shelters which are in many cases legal ways to lower your tax burden. that's something that millions of americans do. they use legal means to lower their taxes so their liability is lower. and it appeared at the time as you even admitted that this was a legal tax shelter. >> i mean, i don't know, but i know some people had indicated it might have been. so i wanted to be very fair about it. but judd, how do you respond to that? is it possible that romney wouldn't have known? even though certainly this is a man who is incredibly sophisticated in his understanding of taxes and tax law. >> i think this goes beyond the very specific question of did mitt romney follow the law. i don't think anyone's accusing him of breaking the law, but there's a fundamental question that comes up in the context of a presidential election and that's do you trust this person. there are so many questions about his conduct that really can't be answered until we see his tax returns. how many people in america know that mitt romney has over $100 million in an i.r.a.? how was he able to do that with the limits that are placed on everyone's personal retirement accounts? and to compare this to the birther situation, the difference is despite the fact that those were absolutely outrageous made up charges that have no basis in reality, obama released his birth certificate. >> but so are these outrageous allegations. there's no proof any wrong doing there never has been. and the senate majority leader went on the senate floor and basically accused the republican nominee for president as being a tax cheat. how is that at all different than the birther issue? there's no evidence of either of these things. >> it's not an issue of whether you're a tax cheat or not, it's an issue of can you trust him, was he behaving ethically, in a way that we expect from a potential president. >> but there is no evidence whatsoever that he is guilty of any of these things that groups like obama campaign are accusing him of. they're saying he did it because he's not releasing his tax forms. that is his own prerogative and since when are you guilty until proven innocent? >> we'll hit pause on that. i will note just for the record that the men who wrote this have written other op-eds critical of mitt romney on taxes, but everyone we talked to spoke highly of them and said their reputation is pristine. and the best that there is. still out front, the obama campaign has dodged questions about super pac ads slamming mitt romney. since we're going to hit one, we'll hit the other. is the president hiding behind a technicality? and starbucks takes a step to some day eliminate cash. but that does not add up. and gabby douglas, america's gymnast darling in the olympics. the color of her skin. how much does it matter? 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[ female announcer ] neosporin® plus pain relief starts relieving pain faster and kills more types of infecous bacteria. neosporin® plus pain relief. for a two dollar coupon, visit neosporin.com. ♪ ♪ [ male announcer ] you've been years in the making. and there are many years ahead. join the millions of members who've chosen an aarp medicare supplement insurance plan insured by unitedhealthcare insurance company. go long. ♪ ( whirring and crackling sounds ) man: assembly lines that fix themselves. the most innovative companies are doing things they never could before, by building on the cisco intelligent network. our second story out front, the obama campaign is dodging blame for something very nasty. two top aides to the president dodged questions today over inaccuracies from an ad from a super pac supporting the president. here's the ad. >> when mitt romney and bain closed t plant, i lost my health care and my family lost their health care and a short time after that my wife became ill. >> the ad blames mitt romney for a woman's cancer-related death. now, we want to say again what we said last night. the facts on this ad don't even add up. the woman who sadly died was covered by her own employer as her primary coverage, not even by her husband's insurance. so the whole premise here is wrong. but when asked about the ad today, white house press secretary jay carney told reporters, i still haven't seen the ad. i've read about it. i don't speak for a third party group. obama campaign spokeswoman doubled down. we have no involvement with any ads that are done by priorities usa. all right. priorities usa is the super pac that paid for this ad. now, super pacs are not allowed by law to coordinate with campaigns. and bill burton, head of priorities usa, denies any coordination. >> the campaign is doing what the campaign is doing. but to suggest that we would be mixing those two i think is a distortion of what the campaign finance laws are and what would possibly even happen here. >> okay. here's the rub, though. bill burton and the president are tight. bill burton served as president obama's national press secretary during his first presidential campaign and then when he won as deputy press secretary in the obama white house. a job that he left to start priorities usa. bill burton knows the president's ethics very well and it is fair to hold him up to this standard. any ad bill burton runs, he knows the president would personally support. the president cannot hyde behind a super pac on an ad as ugly as this one. when that super pac is run by a long-time friend and deputy. let me start with this. the law prohibits technically the coordinating between super pac and the campaigns. one of the operatives who said we have nothing to do with priorities usa, brianna keilar, our cnn colleague, reports that the man you see in the ad there, everyone, told his personal story on an obama campaign call in may, a campaign call that the deputy campaign manager stephanie cutter was on. the campaign has asked him to appear at rallies in battleground states. so how did bill burton hear about this gentleman? >> this shows how fundamentally screwed up the super pac laws are. anything that's technically public information can be used. and the campaigns and super pacs both take a wink and a nod look at this on both sides of the aisle. technically there is no coordination and the super pacs realize that they have the ability, the license and plausibility deniability. and they can do things that a campaign doesn't. just like in the obama camp there are overlapping relationships that go way back, that's true on the republican side of the aisle. so they say it's public information. that's been out there. so this is part of the problem of the political campaign finance world we're in right now. and it's prevalent on both sides and it's leading directly to these ugly ads. >> isn't it fair to say that one should expect bill burton to run an ad that he thinks that barack obama would personally be all right with. >> not at all. >> why not? >> because that's the whole construct of citizens united. you're transferring power from elected officials and their staffs to these unnamed, unsourced, un-whatever groups. bill burton is a friend of mine, but you give burton the power to decide what the campaign should be about. you give one of the republican guys the power instead of giving that power to the politician who is the person that we'll hold accountable. and that's the reason why john's right, we've got to change these laws. >> because we come back to this personal thing, i know bill burton, as well, it doesn't seem that personally this is the right thing to do. and personally should you hold him to that standard, although everyone will point at the law. the law says this, so if i don't run a nasty ad, the guy over in mitt romney's super pac will run a nasty one. >> it's important to understand the partisan mind set and that's that it's really important to defeat the candidate of the other side and so that means that even if this ad is somewhat misleading, that's okay. you throw up a cloud of dust. and actually the case right now is does the push back against this ad, does finding out that this gentleman had appeared in obama campaign appearances made a difference, or does the ad information get out there enough or does it matter to have the ad out there in the first place -- >> the ad has not even run. part of me i think about this because, yeah, personally i have a moral point of view about it. but it hasn't even run. and we're running it because we have a point of view about it and yet we're kind of adding to the problem. >> that's right. and this is all by design. that kind of earned media is more valuable even than paid media. there is actually unlimited money in the cycle, but there's limited television time. so it all becomes a game about how to get past those limits. and both campaigns do it. and that race to the bottom, the more outrageous and negative the ad, not only can it drive down the negatives, but it can also gain free tv time. so it's all part of the cynical game that the super pac economy has created in american politics. >> and mitt romney launched an ad that the president's allies believe is completely false on this welfare tact. and you know what the obama people realized, there's no referee in national politics. nobody will say ten yard penalty and change of possession. >> this is mitt romney saying that obama took out work from welfare. that's what you're referring to? >> absolutely. so what you do is you don't wait for somebody to come in and call foul. you hit back. you counter punch. and i think that's what happened today from priorities. they counter punched with this ad yesterday. and that's why people are reacting to it. they didn't wait for somebody else to call it. is and frankly, that's your only option. in politics. you can't sit around and wait. >> and with the deadlock 3-3, there's not any decisions on these gray areas until after the election is long in the rear view mirror. yet another problem. >> and final word. the romney ad when we looked at it saying welfare to work, that didn't add up either. both sides are -- >> i think there are definitely legitimate concerns to what's happening to welfare to work. but granted whenever you're presenting this kind of advertisement, these are very complex issues. you're trying to distill them in an accessible, simple way that connects with people emotionally and that's very tricky territory. regardless of the side you're on. >> i know john doesn't agree but we're out of time. "outfront" next. starbucks wants to change the way you pay for coffee. and a story we brought you last night on "outfront" flowing. a british bank, iran and the f bomb. what's that? it's eassist. helps the engine run really efficiently. it captures energy that assists the engine... so i'm never guzzling gas. oh -- that's hippie talk. it's called technology dad... here take two dollars. take the money. [ male announcer ] the all new 37 mpg highway chevy malibu eco. from conserving fuel, to the technology that makes it happen. chevy runs deep. [ male announcer ] you work hard. stretch every penny. but chances are you pay a higher tax rate than him... mitt romney made twenty million dollars in two thousand ten but paid only fourteen percent in taxes... probably less than you now he has a plan that would give millionaires another tax break... and raises taxes on middle class families by up to two thousand dollars a year. mitt romney's middle class tax increase. he pays less. you pay more. mitt romney's middle class tax increase. it's something you're born with. and inspires the things you choose to do. you do what you do... because it matters. at hp we don't just believe in the power of technology. we believe in the power of people when technology works for you. to dream. to create. to work. if you're going to do something. make it matter. so starbucks is investing $25 million in mobile payment company square. the company is best known for its square credit card reader. basically it plugs into a smart phone, you see it being demoed right here. it was popular with small business owners at flee market booths, places that could only take cash, but now they could actually process a credit card anyplace that they could get wireless reception. so that was a great innovation. square has now launched a phone app that links your credit card to your square account. so now all you have to do is touch the app and you pay. go to starbucks, latte, wham, bam. but no. the number is $470,600,000,000. that is how much the value of currency in circulation in this country has increased since the year 2000. that is an 80% jump. some of you may say this is why we'll have an inflation crisis, but that's not where i'm going with this. dollars are typically used when you make those smaller transactions like buying a latte. 67% of all transactions that were $10 and below are paid for right now using cash. so new technology is great for now, cash is still king. still "outfront," new details in on the murderer the oak creek temple massacre and how he died. and later, madonna and the trial of a rock group jailed in russia for defying vladimir putin. don't have them. questions about treatment where to go for extra help, how to live better with the disease