Romney: Big Spending Cuts Will Cause Recession

Romney: Big Spending Cuts Will Cause Recession

Asked by Time's Mark Halperin Wednesday why he wouldn't push major cuts in his first year, Romney responded with reasoning that would be largely uncontroversial if not for the past two years' mainstreaming of an economic philosophy that insists government spending actually costs jobs, rather than creates job.

"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 percent. That is by definition throwing us into recession or depression. So I'm not going to do that, of course," Romney said in an answer picked up by former bank regulator William Black, a HuffPost blogger.

Boehner, by contrast, said cutting spending will spur the economy by giving "certainty" to the business community. "It would lift this cloud of uncertainty that's causing employers to wonder what's next. So dealing with our debt and our deficit are critically important," he said.

Any spending cuts, Romney said, should come down the road, after the economy has improved.

"I don't want to have us go into a recession in order to balance the budget," he said. "I'd like to have us have high rates of growth at the same time we bring down federal spending, on, if you will, a ramp that’s affordable, but that does not cause us to enter into a economic decline."

Romney's reasoning accepts the basic premise that government spending adds to GDP and leads to economic growth, at least during times when consumer spending and private-sector demand is down.

The economic assertion is supported by the post-recession job creation numbers.​

Source: HuffPo

emphasis mine.

Pretty curious comments for a limited government conservative to make, as well as someone who has endorsed a Paul Ryan plan ripe with domestic spending cuts... which begs the question of why it was even endorsed in the first place by the presumptive nominee. While it's true that the Ryan plan would implement a number of changes that stretch out as far as 2040, it's important to note that the Ryan plan doesn't wait for better U.S. economic conditions. With comments like these, it seems as if Mitt is willing to neutralize one of his strongest arguments against Obama on both the campaign and the debate stage. Comments are welcome.

 

Jesus.

This is the best that the GOP could do? I am starting to think Romney is so far left he would not win the Democratic nomination.

It is almost as if he is working to get the president reelected. His mouth seems to be reflect the vacuous nature of his thought process.

 

Depends on what you call spending cuts. If you kept the budget the same next year, for the Democrats that would be "slashing the budget to the bone" and putting old people out on the street to starve, etc..

 

If you kept the budget the same next year, the Republicans consider that as "impeding the military's ability to wage unnecessary offensive war."

 

"Any spending cuts, Romney said, should come down the road, after the economy has improved."

 

You see now, the Republicans also know their candidate is lying. So when he changes their position, they don't mind because they knew he was lying anyway. They just are going to vote for whoever Faux News tells them to. And since Faux News told them Obama is a born in Kenya, Communist Nazi, that's what they believe. And since Faux News told them Romney is the guy to vote, even though he lies about anything and everything, that's who they are gonna vote for.

 

This proves Romney is a Keynesian when it comes to economics. He is a more conservative Keynesian, yet a Keynesian nonetheless.

 

With the way the government has chosen to influence the economy ( at the $$$ behest $$$$ of Corporate entities) Any spending cuts to social welfare, farm subsidies, boondoggles like Ethanol, military industrial/corporate welfare, Tax code meant to stifle small business and skewed to pamper international conglomerates, ghastly unproductive and criminal "war on drugs"... Romney is right. If you take one trillion dollars out the first year without addressing all those problems.. we will be screwed. He is simply showing his true colors and the fact that he is bought and paid for by the same people that controlled Reagan, Clinton, Bush 1&2 and now Obama. Romney knows he isnt going to become president by alienating over half the voting citizens in this country or by alienating his handlers in corporate america. He is going to try to do what every president in the last 40 years has done and deficit spend and legislate his way to the next bubble economy and he and his buddies will be in position to capitalize right before it pops .. just like all his predecessors.

 

Wrong. Fox did not tell people who to vote for.

The problem is there was several Conservative candidates and only one moderate candidate.

The result was even thou Conservative are the majority of primary voters, they split their vote among several candidates. The moderates all backed Romney. The result was inevitable. Romney just skated along and won. With no real vetting process.

 

Great thread.

This is the problem with modern politics, apparent polarization but actual consensus. The democrats appease the mob, the republicans appease the privileged.

The path we are on may change but the destination remains the same.

 

Correction. Anything Romney says is proof of nothing except that he will say anything to get elected.

For instance.....in Iowa on May 15.

"We can't spend another four years talking about solving a problem that we know we're making worse every day," Romney said. "When the men and women who settled the Iowa prairie saw a fire in the distance, they didn't look around for someone else to save them or go back to sleep and hope the wind might change directions. They knew that survival was up to them. A prairie fire of debt is sweeping across Iowa and across the nation, and every day that we fail to act, that fire gets closer to the homes and the children we love."

Romney said Obama has been feeding rather than putting out the fire. "He has spent more and borrowed more. The time has come for a president, a leader, who will lead. I will lead us out of this debt and spending inferno."

http://www.cbsnews.com/8301-503544_...imulus-likens-federal-debt-to-a-prairie-fire/

By all analyses, his economic plan will increase the debt. Here's an example. I haven't found one yet that reconciles with his 'prairie fires of debt' slogan.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The Republican hopefuls who want to relieve Obama of his job would not simply add two or three trillion dollars of deficits over the next decade, as the president has proposed to do. Mitt Romney, who touts his business acumen as a prime qualification to be president, makes Obama appear as tight-fisted as Grover Cleveland by comparison. Romney's initial tax plan was as follows: those making more than $1 million a year would receive an average federal income tax cut of $145,000 by 2015. This scheme would increase deficits by about $180 billion annually by 2015, according to the Tax Policy Center. But apparently that was not enough to satisfy his contributors, so at the end of February 2012, Romney added a 20 percent cut in all income tax rates and a repeal of the AMT. The Center estimated that the 20 percent rate cut would add an additional $150 billion to the deficit in 2015 alone. The policy group did not calculate a ten-year estimate, but it is safe to say that Romney's new and improved boondoggle would add about $3 trillion over ten years on top of Obama's pre-existing plan to increase the deficit by $2.7 trillion.

But as the old Veg-O-Matic ads would say, "Wait! - there's more!" In order to pander to the militarism in the GOP base (and potential contributors in the military-industrial complex), Romney advocates increasing military spending to 4 percent of gross domestic product (GDP). Over the next decade, that would add another $2.6 trillion to the deficit.

To summarize: Romney would accept most of Obama's additions to the deficit (say, $2 trillion), add $3.0 trillion in additional tax cuts, and then top it off with $2.6 trillion of increased military spending. Therefore, he would add well over $7 trillion to a ten-year future baseline deficit that is already $3.1 trillion. So, how would Romney cut over $10 trillion (about two-thirds of our annual GDP) to achieve his campaign's goal of a balanced budget within the next decade?

http://truth-out.org/index.php?opti...l-math-their-budget-plans-explode-the-deficit

 

Romney is a spend and spend Republican who doesn't have the nerve to fix the debt crisis.

As a Democrat I'm very disappointed that we are going back to pork barrel spending after the last two years of fighting tooth and nail to fix the US budget deficit.

 

I use his record and and his current proposals to draw conclusions on his economic mindset. I have determined that he is in fact a conservative Keynesian. What he says to the news media is rather inconsequential unless it aligns with my observations of his record and proposals.

 

Like the conservatives have been saying from the beginning, Romney is just another liberal. The fact that he is a GOP liberal shouldn't matter, but the GOP cheerleaders sure like to pretend it does. These P.O.S. politicians are going to keep digging us deeper and deeper into this hole until our entire GDP can't even pay the interest on the debt.

 

Yep. . .so, what is so different from what President Obama has said all along?

But. . .I guess if a REPUBLICAN says it. . . it make sense!

Hypocrisy, again!

 

Absolutely correct. Even though politicians say different things, they all do the same things when in power. It has been that way all of my life.

 

That's been the Democrats platform all long. Its the GOP including Romney who have been crying for cutting spending.

 

and you, like a good little boy, will vote for the Democrat offering, because you were likewise told to.
What's the difference ? ..............nothing.

 

I realize that! And it makes sense to me, especially in view of what happened in England due to the premature implimentation of the austerity policies!

What Iam pointing at is the hypocrisy (once again) of those attacking Obama for htat policy, but giving a free pass to Romney!

 

No thank you. I despise the Republicans only slightly more than the Democrats. Obama is as willing to bend to the powers that be as would be Romney. When it comes down to it, they are the same power seeking scum.

 

Does that mean you will not vote for either ?
And if they are the same scum, why do you not slam the democrat supporters in a similar fashion ? They are no different.

 

Because they at least ask their party for the right things. They believe that if they put enough pressure on the party, they will have to succumb. I don't believe hat but I support their intention. The conservatives on the other hand ask for the exact things that those elites want so they can screw up the rest. So I do not have a problem with Democrat supporters I have a problem with the party. I do have a problem with both GOP and their supporters because their supporters support the very actions of the elite that screw the rest of the population. See the difference?

 

Sounds to me like Romney wants to cut spending, little by little, on the heels of an improving economy. That makes sense to me. The Dems seem to want to just keep spending as a strategy. In short, Romney veers away from the Dem strategy, putting the two farther apart as time goes on.

 

Not really. The percentage of spending Romney proposed as a percentage of total GDP is higher than the amount that is being spent today. The Democrats don't want to keep spending either but realize that when the economy is down, curbing on spending only makes the economy worse. Let the economy get back on its feet then curb spending. If the economy is soaring, revenues will automatically become higher which would help decrease the deficit.

 

I don't know about that. The Dems have held the purse strings for almost six years now. There doesn't seem to be any significant improvement to the economy, our debt is a lot more, and they want to keep spending. I have a lot more confidence in Romney's judgment and expertise than in Obama's. Something should have changed by now. It's time to change Presidents. But we agree that cutting spending should follow economic improvement.