Mitt Romney recently stated that he could get unemployment down to 5.8% in just 4 years. (link) Perhaps he was speaking about some other country, because there is no way his ideas will lower US unemployment even a small amount, much less all the way down to 5.8%. That is mainly because his ideas are not actually designed to create jobs, but rather are designed to make rich people even richer than they already are. Here is the recent quote:
Through an economic policy of reduced corporate tax, expanded North American oil drilling, as well as an expansion of trade with South America, and the implementation of a 20% marginal federal income tax for all Americans; Romney claims that he will reduce unemployment to 5.8% by his 4th year in office.If you add in Mr. Romney’s promise to end the Affordable Care Act on his first day in office, that makes a total of five ideas. Of these five ideas, two are retreads from the Bush administration, two are based on lies created by front groups pretending to be neutral, and one is really a “me, too” policy that seems mostly meaningless until you realize the implications of this policy when combined with other details of Romney's plan.
RETREADED BUSH LIES
Anyone who was paying any attention at all during the George W. Bush administration should immediately reject the idea that corporate tax cuts or a reduction in the marginal tax rate will lead to the creation of jobs. During the eight years of that administration, when these two policies were touted as ways to create jobs, we actually lost about 653,000 private sector jobs. The WSJ pointed out that this was the worst jobs creation record on record. Atlantic magazine described just how abysmal this period was in other ways:
On every major measurement, the Census Bureau report shows that the country lost ground during Bush's two terms. While Bush was in office, the median household income declined, poverty increased, childhood poverty increased even more, and the number of Americans without health insurance spiked.So no one should accept these same policies as job creation tools, or tools to otherwise improve the situation of those suffering most during difficult economic times. Quoting a recent study of some of the specifics of Mr. Romney's corporate tax cuts, President Obama pointed out that the policies might create 800,000 jobs, but not in the US. Detailed analysis reveals some of Mr. Romney's corporate tax cut related policy suggestions:
Romney’s proposed exemption for foreign profits would exacerbate the worst features of our current tax system. It would:This makes the real reason for the corporate tax cuts easier to see. They are not designed to create US jobs but are designed to help corporations make even more profits. And that also gives a clue to the real reasons for lowering the marginal income tax rates, something which Mr. Romney only came up with as a way to compete with a surging Rick Santorum during the GOP primary. Like the Bush tax cuts before them, the Romney tax cutswould be skewed toward the upper end of the income scale. They are not designed to create jobs but to find a way to let rich people keep even more of their money.
Enhance the tax code’s rewards for moving jobs and investments overseas
Provide a gratuitous windfall to some of the very companies that have already shifted jobs and profits overseas
Further invite the offshore tax haven abuse that deprives the U.S. Treasury of tens of billions of dollars in revenue every year
Incidentally, if you want tax cuts to stimulate the economy and help create demand which leads to jobs, you target the lower end of the income scale, not the upper end:
Zandi also examined an alternative stimulus package and found it would have yielded far more short-term demand — $1.20 for each $1 of cost — and thus have generated significantly more economic and job growth. The alternative package would have put more money into the hands of those who immediately spend it — low- and middle-income Americans — through tax cuts targeted on this group, greater temporary unemployment benefits, and more federal fiscal relief to states to lessen state budget cuts and tax increases. As noted, the federal tax cuts that were enacted are heavily skewed toward high-income households, who are much less likely than other households to spend their tax cuts quickly.LIES PROMOTED BY FRONT GROUPS WHO HIDE THEIR MONEY SOURCES
Mr. Romney would like for you to be unaware that Big Oil has bought and paid for front groups, and politicians like him, to spread the lie that lots of jobs can be created if we relax the rules on drilling and exploration. An example of a bought and paid for rosy jobs prediction is here and here. A sobering refutation of that jobs prediction is here. Excellent discussion of this by Steve Horn, including all the money connections that led to the intentionally created false reports is here. Here is a snippet of the connections:
PPINYS is an associate member of the State Policy Network, a right-wing clearinghouse of state-level think tanks located throughout the United States, funded by the likes of the Bradley Foundation, the John M. Olin Foundation, and the Koch-funded Claude R. Lambe Charitable Foundation.And lest you think there still might be jobs to be had check this out from Ed Markey:
Furthermore, PPINYS is also affiliated with The Business Council of New York State, according to its website, and two out of nine members of its Board of Trustees are members of The Business Council. Another member of its Board of Trustees, James W. Kinnear, is the former CEO of Texaco, which has since been purchased by Chevron. Kinnear is still listed as representing Chevron on The Business Council website, though his biographical sketch located on Bloomberg Businessweek shows him as the Director of Saudi Arabia Oil Company.
It appears the oil lobby got what they paid for: cooked numbers to justify their untenable policy positions. When the top five oil companies shed thousands of jobs over the last five years, and companies aren’t even taking advantage of most drilling opportunities offered to them, it seems to me creating a million jobs doesn’t even have a million-to-one chance of happening.From the same source we get this quote aout solar and wind energy:
“Solar energy has doubled its American jobs in the last two years, going from 50,000 jobs in 2009 to 100,000 jobs in 2010,” Markey writes. “Wind energy now employs 75,000 American workers.”That last quote stands in contradiction to Mitt Romney's energy policy, which is designed to promote non-green energy alternatives. Then again, Mitt Romney promoted green energy as governor of Massachusetts.
If Mitt Romney's current energy ideas won't really create jobs, what will they do? They will make money for Big Oil and its friends.
Romney's flip-flop on green energy may bring to mind his flip-flop on his health care plan in Massachusetts, which he once widely touted as a model for a national health care plan but now decries as a jobs killer.
As with the fake research funded by the oil and gas industry, Romney's opposition to the Affordable Care Act is shared with a front group, NFIB, that pretends to represent the interests of small businesses but has strong money tiesto Republicans in general and Karl Rove in particular. In reality, health care costs were the top concern of small businesses for years leading up to the 2009 creation of the Affordable Care Act. And small businesses benefit a lot from the ACA. NFIB's opposition to the ACA even causes some of its own members to question the motives. From CBS we get some of the false equivalency typical of what passes for journalism these days:
One of the main litigants against the law is the National Federation of Independent Business (NFIB), a Washington trade association that contends the new law will raise its members' costs, burden them with regulations, and kill jobs. Other small business groups argue the opposite, claiming that the law is already lowering costs, expanding firms' insurance options, and easing the process of arranging coverage.But even CBS focused on a small business owner who supported ACA. NPR and NBC quoted a member of NFIB as representative of small businesses but failed to disclose his biases. There are plenty of legitimate small business groups who could be quoted to show that the ACA is actually popular among small businesses. For example there are stories from Utah, Illinois and the SBM (small business majority). From the SBM we get this:
But a poll released today by a different small business lobbying group – Small Business Majority– found that small business owners in eight states polled (both red and blue, including Illinois) favor the landmark national health care reform and want the Supreme Court to keep it intact.Small businesses are the jobs creation engine of the economy and the ACA helps these small businesses, which is good for jobs creation. Though Mitt Romney knows from his own experience in Massachusetts that these policies are good for creating jobs and once encouraged President Obama to use Massachusetts as a model for the nation, he now opposes the ACA, which is based on the Massachusetts plan, in his run for president. This is not a jobs creation or job saving position. Which rich people are benefitting from this opposition? Those who make money from overpriced healthcare. And Republicans who use opposition to "Obamacare" as a fundraising tool.
Of the 800 small business owners surveyed, 56 percent support either keeping ACA as is or making minor changes, while 28 percent want to repeal the law.
"Me Too" policy with bad potential
Mitt Romney's last supposed jobs creation idea is expansion of trade with South America. At first this looks like a mere "me too" policy because expansion of trade with South Korea, Panama and Colombia has been one of the few things the Republican Congress has passed. At first it seemed odd that Romney would specifically mention trade with South America. But when you realize that his plans, as mentioned above, would actually encourage offshoring, perhaps South America would be a closer place to find cheap labor.
Although trade with other countries could create jobs, it could also cost jobs if trade partners have weak worker protection rules. This was one of the things President Obama focused on particularly in the Colombia deal:
In addition, President Obama insisted that a number of serious and immediate labor concerns be addressed before he would be willing to send the Agreement to Congress. These concerns included violence against Colombian labor union members; inadequate efforts to bring perpetrators of murders of such persons to justice; and insufficient protection of workers’ rights in Colombia.Mitt Romney's background makes me believe he would be more likely to offshore jobs to South America than enforce fair trade rules that would protect US jobs.
Thus far, Mitt Romney's supposed jobs creation policies have been shown to be mostly, and maybe completely, ways to make rich people even richer instead of actually creating US jobs. But there is one other observation to make that makes it almost certain that Romney's jobs creation record would be even worse than that of George W. Bush. Although President Bush lost 653,000 private sector jobs, he did have a lot of public sector jobs growth. In this area, President Bush actually outdid in 8 years what President Obama has done in four. We have lost about 600,000 public sector jobs under President Obama. (link)
Looking at Mr. Romney's plans, there is reason to believe that his tax cut plans would as ineffective as those of President Bush at creating private sector jobs. And there is very little in the plans to suggest there would be any public sector growth under a President Romney. One is hard pressed to see any way that he could lower unemployment, at least in the US, to 5.8%.
There are several ways that President Obama could lower the unemployment rate if he were not being blocked by the current Republican congress. His American Jobs Act would likely produce about 1.9 million jobs, which would lower unemployment to close to 7%. If he were to give more money to state and local governments to hire back teachers, police, firefighters and other public employees, most of whom have been let go under Republican austerity measures, President Obama has a potential path to an unemployment number close to or better than the projection of Governor Romney. (link, link)
Although the current economy has slowed in jobs production in recent months, the obstruction of the Republican congress has kept us from having at least 1.9 million more jobs and probably more. It makes no sense to keep that congress and replace the current president with one who would be even worse at producing US jobs. It would be completely logical, if jobs production is what is important, to replace the current congress with one that would not obstruct. And keep the current President.