The Economist Magazine Looks at Mitt Romney

And Does not Like What it Sees (But then, who does?)

The Economist weekly is one of the great periodicals that documents business and politics and economics.  It’s outlook is not neutral, it has a center/right philosophy that trumpets free enterprise democracy.  But it is not ideologically driven, it recognizes that a system such as capitalism must adapt and be controlled to meet society’s goals and objectives.  It does not embrace Conservatism for the sake of Conservatism.

So now that Mitt Romney has secured the Republican nomination for President in the 2012, it was appropriate for The Economist to take an in-depth look at Mr. Romney’s economics positions, philosophies and policy ideas.  It didn’t like very much what it saw.

The key ingredient here is the Paul Ryan (R, Wi.) budget and spending plan that all Republicans have adopted.  It would drastically cut tax rates for the wealthy, eviscerate social programs, replace Medicare with a private insurance system with higher costs and lower benefits and cut Medicaid by limiting funding and just sending limiting funds to the states.  Of course, on both the spending cuts and the tax provisions no specifics have been identified. 

As the Republican battle for the nomination wore on Mr. Romney moved from disinterest in the Ryan Plan to full endorsement.

Over the next few months, though, Mr Romney steadily warmed to Mr Ryan’s plan as he faced a series of rivals from his political right. By December he was attacking Mr Gingrich for criticising it, and this past February he released a new tax plan of his own that slashed all personal tax rates by 20%. And when Mr Ryan produced a new, very similar, version of his budget on March 20th for next fiscal year, Mr Romney was effusive. “It`s a bold and exciting effort,” the front-runner for the Republican presidential nomination declared. It would be “marvellous”, he said, if the Senate passed it.

Note that Mr. Romney’s flip flopping has now become so common and pervasive that no one comments much on it anymore.  It is now taken for granted that Mr. Romney will adopt whatever position he sees as politically advantageous.  For example here is where Mr. Romney used to be.

The rightward drift of Mr Romney has taken him a long way from where he started. His 2010 book, “No Apology”, reads more like a McKinsey report than a memoir (in fact, it regularly quotes McKinsey, a consultancy). It ranges from the business practices of Japanese doctors to how much profit Comcast, a cable company, invests. Leaf through it and last September’s policy platform with its 59 specific proposals, and you will encounter sober discussion of ways to deal with greenhouse gases, international trade and retraining.

which the right leaning Economist found acceptable.  But now they are concerned about where he is today.

Mr Romney claims that this plan would be neutral in terms of both revenue and distribution, meaning it would not change the level of tax take or the relative position of rich and poor. That is hard to believe. The Tax Policy Centre, a research group, reckons Mr Romney’s original plan would have added $180 billion to the deficit in 2015, while the new one adds a whopping $500 billion. 


The Committee for a Responsible Federal Budget, giving Mr Romney some credit for his promised spending cuts, says his plan would send the national debt up to 96% of GDP by 2021 from 73% this year; it would reach only 76% under Mr Obama’s latest budget. Neither group gives Mr Romney credit for his promise to pay for the cuts by closing loopholes, because he has specified none, though he has reportedly told donors he might eliminate deductions for rich people’s second mortgages and for state and local taxes.

Yes, this is deep in the heart of Fantasy Land.

The magazine gently suggests that Mr. Romney may want to change positions yet again,

Mr Romney may want to tack away from these proposals over the course of the campaign in an effort to woo centrist voters. But having so prominently embraced Mr Ryan, it will be difficult for him to let go; and in any case, it may not matter. On fiscal policy, it is Mr Ryan, not Mr Romney, who guides the party’s agenda, in a way no legislator has since Jack Kemp, a backbench congressman, came up with supply-side economics in the 1970s as the party’s route back to the White House.

But the real news here is what many of us know but which the main stream press has refused to report.  If Mr. Romney is elected it will be the radical conservatives in the Congress who will be driving policy.  Mr. Romney’s positions, whatever they are, can be ignored because they will not matter a great deal.  Here is prominent and influential Republican tax guru Grover Norquist spilling the beans about the role of the next Republican President.

As Grover Norquist, an anti-tax campaigner, puts it, “We don’t need a president to tell us in what direction to go. We know what direction to go. We want the Ryan budget. We…just need a president to sign this stuff.”

If Mr. Romney is elected he will have two choices, go along with the radical Congressional agenda or face a primary challenge in 2016 and be the first sitting President in modern times to be denied re-nomination.