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.
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