Obama vs Romney Jobs Plan
FILED TO: Economics
Ezra Klein compares and contrasts the key points in Obama and Romney’s jobs plan:
In his news conference, Romney emphasized four ideas in his plan: expanding domestic energy production, working out trade agreements with Latin America, cracking down on China and cutting the corporate tax rate. These are all reasonable ideas. But working out trade agreements takes a long time. Getting the Keystone oil pipeline up and running takes a long time. Rewriting and implementing a new corporate tax code takes a long time. Changing China’s policies takes a long time. It’s difficult to see how any of these ideas creates a substantial number of jobs quickly.
Obama also tends to emphasize four parts of his plan: increasing infrastructure investment, hiring more state and local workers, doubling the size of the payroll tax cut and adding a new set of tax cuts for small businesses and companies that hire new employees. Two of those policies imply directly hiring hundreds of thousands of workers. The other two move money into the economy immediately. It’s easier to see how these policies lead to more jobs and demand in the short term.
The real difference comes down to how each candidate would pay down the deficit, and as usual, Republicans are big on tax cuts and short on details on how they would pay for them. Writes Klein:
In terms of the deficit, the Obama administration has put forward a specific set of ideas — mostly by eliminating itemized deductions for wealthier Americans — to pay for its plan. The Romney campaign has not yet said how it will cut corporate and individual tax rates without increasing the deficit.
So Romney is basically sticking to the libertarian ideology that tax cuts and deregulation solve everything (including the deficit apparently) whereas Obama’s plan is actually, well, a plan.