But how will he do that? If creating jobs were that easy, surely the Democrats would have created them themselves.
From the little information that Romney has provided, the Romney plan is the son of the Bush plan, and the grandson of the Reagan plan. It has three parts, reduce taxes on the rich “job creators”, free them from intrusive regulations, and increase military spending. Oh, and they will cut away government programs to end the budget deficit.
Reagan followed this same plan. There weren’t millions of new jobs then. Even though he signed tax increase legislation, which no Republican would do now, the national debt increased dramatically.
Twenty years later, George Bush was elected president on the same platform. And he came through as promised. He gave huge tax reductions to the “job creators.” He let them roam unfettered in their economic world. And he fought two wars, one without cause. So military spending went up hugely. And so did the deficit.
So now Romney is promising to return to the good old days of Reagan and Bush. The problem he has to face is that we know how these plans turned out. There weren’t millions of new jobs, only trillions of dollars of new debt and a huge financial crisis. It turns out that the “job creators” weren’t careful managers of any finances but their own.
There is one different element this time. Romney and the GOP now promise they are very concerned about the debt they created. Now they really promise to carry out their three economic ideas and reduce the budget deficit at the same time. If they actually carry out their plans, the cuts they would have to make to just dent the deficit would be disastrous for most of us. The last time this plan was implemented in 2001, we were in a very different place with a balanced budget and many years of surplus revenue awaiting. Now with Americans still suffering from the huge financial loses we experienced in the great financial collapse, this might not be a good time for a third try.
You don’t have to take my word about the dangers and pitfalls of the Romney plan. We have but to look to Europe to see how the old plan works in our new situation. Countries there piloted the GOP austerity plans Not surprisingly, jobs have decreased and the economic options have shrunk. Unemployment has increased to double digits. Even worse, their economies are again in recession.
Copying Europe as the Romney job plan intends to do would produce similar results here. More government jobs would be cut to reduce government red ink. Services that provide a lifeline for the newly unemployed teachers, police, food inspectors, highway workers would have to be cut away to make up for reduced federal revenue and reduced federal spending.
Those people made richer by the Romney plan are already wealthy. They could already be investing in new businesses that would create jobs. But they recognize that there are too few middle class customers to make new businesses a wise investment. The Romney plan would reduce the number of middle class jobs, and so reduce the pool of available customers.
Despite conflicting evidence, the Romney plan expects the private sector to create jobs, so it will drastically reduce the role that government plays in job creation or in helping those already suffering. We would be left to sink or swim as we are. This hands off approach would actually increase unemployment almost immediately and would push a return to prosperity many years into the future.
This is the Republican plan, the Romney plan. It sounds to me rather like standing about, waiting for a forest fire to burn itself out.
Now the Democratic Convention is getting underway. I’m most interested to see what their job program for the next four years will look like.
We’ll talk again after the last gavel falls in the Democratic convention.