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The Dismal Science (Part 2 of 3): Mitt Romney on Jobs and the Economy.

By: Repair_Man_Jack (Diary)  |  August 23rd, 2011 at 12:00 PM  | 

RESIZE: AAA

James MacDonald of ForeignPolicy.com describes the current Seldon Crisis occurring in Western economies as the end of a seven decade experiment. This seven decade experiment is described by Walter Russell Mead as The Blue Social Model. He talks us through its particulars below.

Graduate from high school and you were pretty much guaranteed lifetime employment in a job that gave you a comfortable lower middle class lifestyle; graduate from college and you would be better paid and equally secure. Life would just go on getting better. From generation to generation we would live a life of incremental improvements — the details of life would keep getting better but the broad outlines of our society would stay the same.

The fundamental organizing principal of the American Economy will have to be moved away from the rudiments of the now-failed Blue Social Model. The GOP candidates competing with Barack Obama for the presidency will have to effectively drive this transformation. Yesterday, in the first of a three part series, we discussed Michele Bachmann’s stated policies and past actions with regard to this monumental task. Today, I discuss the policies and past decisions of Mitt Romney.

Candidate Romney’s resume includes a stint as a corporate CEO and as the Governor of Massachusetts. With this background, economics and job creation should be his bread-and-butter issues. His campaign website suggests that he understands this well and intends to use his prior economic experience as his meal-ticket to the GOP nomination to oppose Barack Obama in 2012.

The Issues section of Governor Romney’s website bears out the assertion in the paragraph above. He lists four primary areas of concern: Job Creation, Fiscal Responsibility, Health Care and Foreign Policy. At least three of these four bear heavily on America’s economic future. In his Job Creation section, Romney establishes a fundamental disagreement that he has with how President Obama is currently performing his job.

President Obama has neglected the fundamental tasks of creating jobs and growing our economy. Instead, he’s focused his efforts on an anti-jobs, anti-growth agenda that has significantly expanded the role of the federal government. His actions have only succeeded in creating more of the uncertainty and obstacles to investment that threaten the economic vitality of our nation.

In order to fix what he claims Barack Obama has damaged, Mitt Romney offers up what he describes as five principles of job creation.

• Right-size government by cutting spending, repealing Obamacare, and ending wasteful programs
• Make American businesses competitive in the global economy
• Open markets abroad, on fair terms, for American goods and services
• Ensure energy security and independence for America
• Train and prepare American workers for the jobs of today and tomorrow

Only his first point relates entirely to economics. Romney seems to view the economic problems of America through a holistic and interconnected prism that cuts across nearly every aspect of what the Federal government is involved with. Romney espouses a reduction in the size and scope of the regulatory state. He also wants to adjust energy policy, trade agreements, education policy and probably several other areas of governance to accommodate and support his job creation plans.

In his section of Fiscal Responsibility, he again disagrees with President Obama by opining that the president wants government to spend way too much money that isn’t covered in current revenues. Mr. Romney suggests cutting federal programs, reforming entitlements and putting state and local governments in charge of things the Federal Government does right now. His proposals for executing these things are not laid out in the same detail as his job creation ideas. This suggests, at least for now, that Candidate Romney worries more and plans more regarding the unemployment crisis than the fiscal one.

Romney calls upon Congress to repeal and replace Obamacare in his healthcare issues page. He suggests delegating more healthcare decisions to state governments. He also calls for tort reform, a more open health insurance market and strengthened HSAs. This Federalist agenda may also be how he intends to defend Romneycare while trashing Obamacare at the same time.

By positing the issue in his light, Romney is able to make the claim that Massachusetts can embrace big government healthcare reform while South Carolina, for example may not want to choose that approach. Candidate Romney could than claim further that he isn’t going to judge which approach is right at the present. Federalism is Democracy’s laboratory and smart people can look at the scoreboard in three or four years and decide which state got it right.

In examining Mitt Romney’s economic proposals it becomes clear that he intends to see the unemployment problem as the most important issue. The healthcare fiasco and the fiscal imbalance are also problems worthy of concern – but not as pressing as getting people back to work. Romney would focus on fixing unemployment by changing how a number of different aspects of our current government work. It seems to be the single-minded focus of his current run for office.

Where Romney could run into trouble is with his past record. “Obamneycare”, as former candidate Tim Pawlenty described it, put Massachusetts under a very bureaucratic healthcare plan. This would constantly remind conservative voters of another, very similar piece of unpopular legislation. His assertion that Obamacare isn’t right for everyone and that states should decide health policies for themselves, may not convince people that he has the conviction that Congresswoman Bachman would have in getting Obamacare consigned to the dung heap of failed, socialistic ideas.

Romney’s Wall Street connections may lead him to be held in abeyance by more Jacksonian elements of the GOP electorate. His “No Apology” slogan is not only a veiled shot at President Obama but also an attempt to make people forget “Flip the Romney-Dolphin” that very well could backfire.

In conclusion, Romney has put forth an intelligent and detailed case that unemployment is America’s biggest problem heading into 2012. GOP primary voters will have to decide whether they agree with this assessment enough to trust Mitt Romney to rebuild America’s damaged economy.

COMMENTS

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  • http://impudent.edublogs.org/ kyle8

    “conservative” activism. My own belief is that the one and ONLY thing that government can do to help commerce at this stage is to shrink and get out of the way. We don’t need another top down big program of government to deal with unemployment even if it is a fiscally conservative one.

  • freedomscribe

    Run the other way. Santorum wants to reduce the corporate tax rate to zero – but only for manufacturers. Get out of the way. It is just a tax on consumers. Reduce it to zero for all incorporated entities. Let people set up business in an afternoon, like Singapore. Reign in he EPA, the FDA, the whole alphabet soup of worthless bureaucrats.

  • azrally

    and Mr. Romney doesn’t have detailed plans for dealing with the nation’s problems? If it is normal for politicians to keep their plans close to the vest so as to reduce the opponent’s ability to “pick them apart”, it seems our current system has even corrupted this to the extent that no candidate actually creates any plans. Vague generalities give us what we have now, a President with no experience, no plans and a manufactured hype. Mitt Romney needs to present some plans as his verifiable experience does not point to a small government, conservative agenda. . .

  • 1stRichard

    From someone that worked with Romney when he was Governor, her excuse for Romney was the need for compromise and bipartisanship. Romneycare may have started with good intentions but compromise and bipartisanship has turned it in to a nightmare here. Of all the troubles with his past record, this one has me most concerned.

    Some have used the phrase flip-flop but from what I have seen, Populist may be a better description and if you have read my entries here I do not like Populism. Romney may have some good points but the bad points have me undecided, a chance that may not be worth the risk.

  • Adjoran

    is that “right-sizing” government means big cuts to the federal workforce. But he spent most of his life buying into troubled companies and fixing them, and the fixing usually involves cutting expenses and that means jobs.

    When we talk about eliminating departments, we have to remember that means eliminating jobs. And it would be very poor politics to give the worst jobs President in history the jobs issue to hit us with.

    So those who object to the lack of specifics, try thinking things through. Specifics only alienate people and provide targets for attack. They are for suckers.

    • Flagstaff

      correct.

      Practically speaking, any plan to cut the size of the federal government must start by cutting other projects first, giving the private sector time to turn itself around and start growing again, and then conducting gradual layoffs of government workers.

      You may note that Obama has of late been talking about reducing the size of the military. He doesn’t mention that he is talking about military “layoffs.”

      We will need to approach the situation a bit like they approached the return of all those WWII vets in the late forties. There was great fear of a depression brought about by massive unemployment. Instead, there was a gradually improving economy as those former soldiers and sailors created demand for all kinds of goods and services.

      At the time, there was no EPA or anything like it to hinder the recovery by restricting the ability of companies to increase production to meet demand and hire new workers to handle the production. Nobody told Ford, GM, Chrysler, Studebaker, Hudson, Nash, or Packard that they couldn’t build whatever kind of car they wanted to, and the result was wild designs, lots of chrome, and a boom in the auto industry as people had many styles to choose from, and they did. Television spread across the country. Housing–another boom.

      That all happened in spite of high tax rates, not because of them; truthfully those high rates were probably paid by relatively few people, and the tax code itself was far simpler than it is today. Most folks didn’t invest–they saved, at two to three percent rates in their passbook savings accounts, and those savings were available for loan at decent rates, because there was not a giant money vacuum in Washington, D.C., sucking all the liquidity out of the market by providing a higher, safer “guaranteed” rate of return.

      Whatever the differences between then and now, one thing is still true: people and businesses and the economy prospers best when government keeps its heavy hand out of the process. Of all the practical things any President could do to create jobs, the best would be to scale back government interference in the economy, for interference it surely is. Get out of the habit of trying to help “important” industries–let their customers help them by buying their products.

      One of the most expensive burdens we’ve placed on business in recent decades is that of time. We take their time from them by requiring all kinds of reports. We also take their time by demanding proof in advance that what they want to do is “good”–environmental impact studies that have to be created, then revised and redone, for example, that greatly increase the cost of any new endeavor by delaying it for months, years, or decades.

      Side note: Our local ski area has been trying to get permission to make artificial snow for about twenty years. Because it’s leased on federal forest land, they have been made to jump through myriad hoops. Because the southwestern Indians insist the mountain is “sacred,” the hoops became smaller and more difficult. Once the last one was threaded and the Supreme Court satisfied, the Obama administration refused to issue the permit. At last it came, and even though another legal challenge is in the works, the resort has broken ground for the water line. Not without the usual contingent of white wannabe-Indians chaining themselves to heavy equipment to try to stop the process, of course.

      Religious questions aside, there are alternatives to massive studies, such as posting bond to guarantee that any problem can and will be rectified. I’m not claiming to know the right answers, but I do claim there are some answers that are more right than others, and they all include a move toward less government regulation.

  • drfredc

    Romney’s basics seems reasonable. However, IMHO, all the GOP candidates seem to miss the issue of marketability.

    This election is going to come down to a candidate offering a reasonable balance between Red (private sector), White (seniors), and Blue (unions) versus Blue Green Obama’s heavy tilt to Privileged Blue public union bureaucracies and Green extremists.

    Red, White & Blue vs Blue Green….

    Simple, direct, and allows each supporter the choice of filling in the details according to their own perspectives.

    Sure it’s appropriate to have some modest outlines for wonks to mull over — not that there are any plans offered by the Blue-Green side in the Senate or WH. The reality is if the GOP take the WH, there will be wonks from most every corner of the GOP working to turn the Obamacrat mess around. Further, when the Obamacrats do put forth something, they’ll surely include lots of new spending plus more job killing taxes and regulations.

    KISS — Red, White, & Blue vs Blue Green…

    If everyone running for the WH & Congress stays on that page it’ll be a no brainer landslide in the WH and Congress… Big majorities matter more than details…

    • Flagstaff

      But what color is the government sector? How about yellow?

  • californiagold

    Romney is trying to sell the voters on the idea that each state government should be able to decide for themselves what type of healthcare plan they want. I find this logic flawed, as well as disingenuous.

    What if each state followed the Massachusetts model which mandates that all citizens purchase health insurance ? How would that be any different than ObamaCare ? And what if some states decided to eliminate private insurance ? Is Mitt Romney comfortable with that scenario ?