Does Romney have a Workable Economic Plan?

Thursday, September 6^th, 2012

Boon Rouge, Louisiana

MITT ROMNEY AND JOB CREATION!

The focus for Mitt Romney last week at the Republican National Convention was supposed be his plan to create jobs and strengthen the economy. It was supposed to be all about the candidate, with the party faithful rallying around both him and his vision to put Americans back to work.  Romney and his wife did their job and carried the main political load. But overall, just how well did Romney and his supporting cast rate with voters throughout the country in “closing the deal?”

First out of the box was New Jersey Governor Chris Christie. He had been pegged by the Romney camp to be the keynote speaker at the opening night’s convention. His speech quickly went from the keynote to the “me note,” as the Governor spent the bulk of his time touting the “Jersey Comeback” and his own personal credentials. Romney was scarcely mentioned.  New Jersey, by the way, needs a lot of touting. Under Christie’s leadership, New Jersey’s unemployment is one of the highest in the nation at 9.8%.

Then came Florida Senator Marco Rubio who was chosen to introduce Romney to the convention and the national television audience. Rubio was picked because of his Hispanic background, as party operatives recognized that without a sizable Hispanic vote, Romney cannot win in November. Maybe his comments were calculated for this purpose, but the speech was also an “all about me” commentary. And again, Romney was barely mentioned. 

The top of the RNC staff thought it would be a good idea to enlist Clint Eastwood who proceeded to speak to an invisible Obama in an empty chair. “I never thought it was a good idea for attorneys to be president,” Clint told the crowd, referring to President Obama, who has a Harvard Law Degree.  But guess what, Mitt Romney also has a law degree from Harvard and was admitted to the Michigan Bar. Ouch!  Clint should have stuck with talking to the chair. Even so, Clint spent a lot more time communicating with the chair than he did on espousing the merits of Mitt.

Romney finally made it to the stage and gave about as good a speech as anyone might have expected. He’s no orator, but he did a solid job of telling his story of reaching success in the private sector and showed himself to be a lot more likable than many had imagined.  The Republicans in Tampa loved his comments and finally seemed to accept Romney into the conservative fold. But what about job creation?

“And unlike the president, I have a plan to create 12 million new jobs,” Romney told his crowd.  Sounds great, but consider this -- in April, Macroeconomic Advisors predicted a gain of 12.3 million jobs, and in an August forecast, Moody’s Analytics predicted that 12 million jobs will be created by 2016, no matter who is president.  So is Romney’s jobs prediction really all that bold?  

Here’s what Republican consultant and former Bush adviser David Frum predicts:  “A President Romney would take office in January 2013, at a time when even on a best-case scenario more than 10 million Americans will still be unemployed or under-employed, more than half of them for a very long time. What to do for them? On this urgent topic, the Romney plan falls dismayingly quiet. Even if Romney’s policies do raise the long-term growth rate of the United States beginning sometime about 2014, unemployment won’t return to normal levels until a Romney second term. That portends almost a decade of very high unemployment.”

The bigger question is then: can a president, any president, really create jobs within the confines of a balanced economy? States try to attract and lure jobs all the time with questionable tax breaks and outright subsidies. My home state of Louisiana has poured billions into private coffers in a vain attempt to attract more out-of-state jobs. But all that has happened is the shifting of jobs from one state or one region to another. No real new jobs are have been created, yet the public dole continues to be tapped for more and more publically subsidized dollars.

On the federal level, the GM bailout is touted by the Obama Team as a roaring success. But was it, really? The cost to taxpayers was $25 billion, and GM bondholders received nothing. And as Harvard economics professor Robert Barro wrote in the Wall Street Journal: “If GM had disappeared, its former workers and other inputs would not have sat around doing nothing. Another company -- be it Toyota, Honda or Ford -- would likely have taken over its operations, expanding production in the U.S.”

Most creditable economists predict that any new federal stimulus program would need some $2 Trillion to make any major difference in economic growth. That’s five times the Obama stimulus, and this amount is not politically feasible, no matter who is elected president. Like it or not, the country may just have to follow the Keynesian approach of riding out the storm. But don’t expect either candidate to tell the voters: “If you elect me, I will tell you just to wait things out.”

Romney is walking a thin line here, trying to make his case that he is the better steward for economic growth, by trying to offer creditable alternatives to the president’s plan of more stimulus spending.  He did not meet this test at the Republican Convention. There is a good number of moderate undecided voters who want specifics. Romney has a lot of convincing to do in the coming two months. His election is riding on it.

*******

“See, when the GOVERNMENT spends money, it creates jobs; whereas when the money is left in the hands of TAXPAYERS, God only knows what they do with it.”

Dave Berry

Peace and Justice

Jim Brown

Jim Brown’s syndicated column appears each week in numerous newspapers throughout the nation and on websites worldwide.  You can read all his past columns and see continuing updates at http://www.jimbrownusa.com.  .   You can also hear Jim’s nationally syndicated radio show each Sunday morning from 9 am till 11:00 am, central time, on the Genesis Radio Network, with a live stream at http://www.jimbrownusa.com.