Friday, May 25, 2012

Did Romney give away the game on the budget?

In an interview with Time Magazine, Mitt Romney betrayed the last 3 years of Republican/Tea Party rhetoric.  At one point (ctrl-F for "trillion" to find exactly when), he states:
Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%.  That is by definition throwing us into recession or depression.  So I’m not going to do that, of course.
So Romney says cutting spending too fast can harm economic growth.  One wonders, then, why he has criticized Obama for not cutting spending faster.  Does he think Obama should have slowed the economy by cutting spending more over the past three years?

He goes on to advocate a system of small cuts in the short term with longer term cuts.  Which is, honestly, absolutely 100% the correct strategy.  And it's also exactly what Obama has been doing over the past three years.  Spending has risen more slowly during Obama's presidency than any other recent administration, including Saint Ronald.

This is yet another example of an area where the President has been following what both sides would agree in their more sober moments is the proper strategy.  I continue to be confident that the irrational, reflexive hatred of Obama will wither away once people really start paying attention to politics again.

1 comment:

NWest said...

Which just goes to show that there really are only surface differences between Obama and Romney. Both believe that bureaucrats can "manage" the economy, and have been captured by the Keynesian myth that government spending can grow the economy.

You do not "throw the country into recession" by reducing government spending. From 1920 to 1923, government spending was cut 50% (thanks to Andrew Mellon). Did the country suddenly collapse even further with those cuts? Nope.

Cutting government spending reduces inefficient allocation of resources, allowing those resources to flow to uses prescribed by individuals in the market, not to the boondoggles of politicians and bureaucrats.