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By Misty - Posted on 15 July 2012
Prof. Robert Reich lays out what's at stake in the 2012 Presidential Election
Source: American Progressaction
Economists Agree Romney’s Plan Would Spark a New Recession
The private sector of the U.S. economy has added jobs for the past 27 months in a row, corporate profits have hit an all-time high, and the U.S. auto industry is back, with manufacturers consistently adding jobs for the longest period since the mid-1990s. Still, as President Barack Obama has said, “we are still not creating (jobs) as fast as we want.” And the biggest hurdle to swifter job creation is the embrace of austerity by Republicans in Congress who refuse to implement measures that would boost employment—a position supported by their presidential candidate, former Massachusetts Gov. Mitt Romney.
This austerity has real—negative—economic consequences. Increasingly, economists are pointing to austerity as a key reason for too-slow job creation. Despite considerable warnings from economic experts that government spending is critical to creating jobs, conservative leaders in Congress are inflicting these austerity programs on us at the federal, state, and local level. According to Yale economists Ben Polak and Peter Schott:
Without this hidden austerity program, the economy would look very different. If state and local governments had followed the pattern of the previous two recessions, they would have added 1.4 million to 1.9 million jobs and overall unemployment would be 7.0 to 7.3 percent instead of 8.2 percent.
Even though austerity is not good for the U.S. economy, this is exactly the economic policy promoted by Romney. His ideologically driven agenda would continue the failed supply-side policies of President George W. Bush by giving even more tax breaks to the rich—a policy that has not generated strong and sustained economic growth—while slashing investments in our middle class and America’s future competitiveness, such as education, public safety, basic research and development, and infrastructure upgrades. Romney’s plan for spending cuts is deliberately vague, but it is clear that it will require drastic cuts to programs that support.
The consequences of a Romney economy:
The result would bring more austerity and less growth. According to an analysis by the Center on Budget and Policy Priorities, “by 2022, if the [federal] budget had to be balanced while taxes were cut,” which is Romney’s goal, “the proposals would require cutting entitlement and discretionary programs other than Social Security and core defense by more than half.” Specifically, the Center for Budget and Policy Priorities estimates that Romney’s proposals would deplete Medicare, Medicaid, and the Children’s Health Insurance Program by $3.4 trillion over the next 10 years. In addition, the nonpartisan think tank says that, under Romney’s plan, compensation payments for disabled veterans would be cut by one-quarter, and 13 million people struggling to put food on the table for their families would be kicked off the Supplemental Nutrition Assistance Program.
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