- Romney’s Economic Model – NYTimes.com — Nicholas D. Kristof
Mitt Romney’s best argument on the campaign trail has been simple: Under President Obama, the American economy has remained excruciatingly weak, far underperforming the White House’s own projections.
That’s a fair criticism.
But Obama’s best response could be this: If you want to see how Romney’s economic policies would work out, take a look at Europe. And weep.
In the last few years, Germany and Britain, in particular, have implemented precisely the policies that Romney favors, and they have been richly praised by Republicans here as a result. Yet these days those economies seem, to use a German technical term, kaput.
Is Europe a fair comparison? Well, Republicans seem to think so, because they came up with it. In the last few years, they’ve repeatedly cited Republican-style austerity in places like Germany and Britain as a model for America.
Let’s dial back the time machine and listen up:
All this is exactly what economic textbooks predicted. Since Keynes, it’s been understood that, in a downturn, governments should go into deficit to stimulate demand; that’s how we got out of the Great Depression. And recent European data and I.M.F. analyses underscore that austerity in the middle of a downturn not only doesn’t help but leads toeven higher ratios of debt to economic output.
So, yes, Republicans have a legitimate point about the long-term need to curb deficits and entitlement growth. But, no, it isn’t reasonable for Republicans to advocate austerity in the middle of a downturn. On that, they’re empirically wrong.
If there were still doubt about this, we’ve had a lovely natural experiment in the last few years, as the Republicans in previous years were happy to point out. All industrialized countries experienced similar slowdowns, and the United States under Obama chose a massive stimulus while Germany and Britain chose Republican-endorsed austerity.
Neither approach worked brilliantly. Obama’s initial economic stimulus created at least 1.4 million jobs, according to the nonpartisan Congressional Budget Office. But that wasn’t enough, and it was partly negated by austerity in state and local governments.
Still, America’s economy is now the fastest growing among major countries in the West, and Britain’s is shrinking. Which would you prefer? (read the complete article…)
- New Yorker editor defends Obama endorsement against Scarborough — MSNBC
New Yorker Editor-in-Chief David Remnick and Joe Scarborough sparred this morning over the magazine’s endorsement of President Obama for a second term.
The endorsement, featured in the October 29 issue of the magazine by its editors, praised Obama for being “progressive, competent, rational, decent, and, at times, visionary” and for helping to correct “a large measure of the human suffering and national shame inflicted by the Bush Administration.” (read the complete article…)
- The New Yorker’s Endorsement of Barack Obama : The New Yorker
- CEOs Call for Deficit Action – WSJ.com
Chief executives of more than 80 big-name U.S. corporations, from AetnaInc. AET +0.66% to Weyerhaeuser Co., WY -1.11% are banding together to pressure Congress to reduce the federal deficit with tax-revenue increases as well as spending cuts.
The CEOs, in a statement to be released on Thursday, say any fiscal plan “that can succeed both financially and politically” has to limit the growth of health-care spending, make Social Security solvent and “include comprehensive and pro-growth tax reform, which broadens the base, lowers rates, raises revenues and reduces the deficit.”
The declaration differs sharply from those of several other business groups, which urge Washington to deal with the deficit and avoid across-the-board spending cuts and tax increases set for year-end—but avoid any stance on the politically charged issue of raising taxes.The CEOs who signed the manifesto deem tax increases inevitable no matter which party succeeds at the polls in November. “There is no possible way; you can do the arithmetic a million different ways” to avoid raising taxes, said Mark Bertolini, CEO of Aetna. “You can’t tax your way to fix this problem, and you can’t cut entitlements enough to fix this problem.” (read the complete article….)
- Washington Post endorsement: Four more years for President Obama – The Washington Post