400+ Economists Endorse Romney Plan to Create Jobs & Restore Economic Growth

This news is significant. Obama’s obfuscation continues to be exposed by outstanding experts who are emerging in strong support of Romney’s economic plan.

Stephen Moore published this piece yesterday in The Wall Street Journal titled “Economists 4 Romney”:

The Romney-Ryan ticket gets another boost today when about 400 prominent economists from industry and academia endorsed his economic revival and jobs plan. We came across an advance copy of the statement which reads: “We enthusiastically endorse Governor Mitt Romney’s economic plan to create jobs and restore economic growth while returning America to its tradition of economic freedom. The plan is based on proven principles: a more contained and less intrusive federal government, a greater reliance on the private sector…” The statement refutes many of the Obama campaign’s loud claims that Mr. Romney’s math doesn’t add up.

At least four of the signatories are Nobel prize winners, including Gary Becker, Robert Lucas, Robert Mundell and Edward Prescott. Other highly respected economic thinkers on the list include Phil Gramm, Martin Feldstein, and noted supply-side guru Arthur Laffer. The scholars say they agree with the Romney plan’s intention to “reduce marginal tax rates on business and wage incomes and broaden the tax base to increase investment, jobs, and living standards.” Mr. Obama has lambasted the Romney tax cuts as a giveaway to the rich that will end up leaving the middle class carrying the bag.

Economists Jim Carter and Glenn Hubbard, both of whom worked in the Bush White House, say they “are constantly adding more names.” The purpose of the letter is to add scholarly gravitas to the Romney plan for rebuilding the economy.

The economists’ letter also takes a shot at Mr. Obama’s economic strategies which they believe “only prolong slow growth and high unemployment.” They specifically criticize the “stimulus programs,” ObamaCare, the rise in the debt burden and the regulatory explosion imposed on small businesses. They warn that in a second term Mr. Obama is likely to “double down on the failed policies.”

[...]

Nothing has failed quite like Obamanomics.

I can’t wait to see which experts Obama will roll out to support his plan! He is scrambling now to figure out what to do.


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Cash for Clunkers - Can We Trade-In Congress?

Cash for Clunkers: “One of Washington’s all-time dumb ideas,” according to the Wall Street Journal.

Worst. Program. Ever. (almost)

Worst. Program. Ever. (almost)

Right they are, but let’s backtrack a little. The “Cash for Clunkers” program has been lauded as a huge success by many groups, including, of course, the U.S. Department of Transportation. Near the end of August the DOT gave an official press release that gave a very rosy outlook on the results of the program. Some highlights:

“This is one of the best economic news stories we’ve seen and I’m proud we were able to give consumers a helping hand,” Secretary LaHood said.

According to a preliminary analysis by the White House Council of Economic Advisers, the CARS program will:

  • Boost economic growth in the third quarter of 2009 by 0.3-0.4 percentage points at an annual rate thanks to increased auto sales in July and August.
  • Will sustain the increase in GDP in the fourth quarter because of increased auto production to replace depleted inventories.
  • Will create or save 42,000 jobs in the second half of 2009. Those jobs are expected to remain well after the program’s close.

Ford and General Motors recently announced production increases for both the third and fourth quarters as a result of the demand generated by the program.

I wonder if the economic advisers to the White House realize how short-lived these production increases will be. The reports are already not looking good.
Again from the WSJ:

Remember “cash for clunkers,” the program that subsidized Americans to the tune of nearly $3 billion to buy a new car and destroy an old one? Transportation Secretary Ray LaHood declared in August that, “This is the one stimulus program that seems to be working better than just about any other program.”

If that’s true, heaven help the other programs. Last week U.S. automakers reported that new car sales for September, the first month since the clunker program expired, sank by 25% from a year earlier. Sales at GM and Chrysler fell by 45% and 42%, respectively. Ford was down about 5%. Some 700,000 cars were sold in the summer under the program as buyers received up to $4,500 to buy a new car they would probably have purchased anyway, so all the program seems to have done is steal those sales from the future. Exactly as critics predicted.

In the article they further point out the programs fails on both of it’s purposes, namely to stimulate the economy and help improve the environment. With car sales already falling it’s a given that this was a very short-lived stimulus. Additionally, in terms of the environment, the return on investment is so little that any private company with such an ROI would utterly fail, (fortunately for Congress, they are too big too fail). End result, America assumes an additional $1.4 billion of debt.

Let’s review.

  • Winners: the folks who got a screaming deal on a new car
  • Unchanged: the economy (no long term effect), and the environment (negligible effect)
  • Losers: the American taxpayer

Once again, wealth has been redistributed by means of our taxes, the long-term effect will most likely be adverse, all to promote a liberal agenda, done under the cover of a program to stimulate the economy. The economic advisers to the White House need to be fired. Their shortsightedness and lack of understanding how an economy really works is truly astounding. Of course, they are appointed by President, so it looks like “We the People” will have to see that he is fired first. Mitt Romney 2012 anyone?

The best lines from the WSJ:

The basic fallacy of cash for clunkers is that you can somehow create wealth by destroying existing assets that are still productive, in this case cars that still work.

You can’t raise living standards by breaking windows so some people can get jobs repairing them.

In the category of all-time dumb ideas, cash for clunkers rivals the New Deal brainstorm to slaughter pigs to raise pork prices. The people who really belong in the junk yard are the wizards in Washington who peddled this economic malarkey.

Addendum: Jenn (of NYforMitt) reminds me of a recent article by Jennifer Rubin at CommentaryMagazine.com:

Sen. Lamar Alexander was pushing the idea (originally floated by Mitt Romney) that we should be giving car-company stock back to the taxpayers. The idea: let’s get the government out of the car business, put a halt to huge transfers of wealth to enfeebled companies, and give the taxpayers some hope of a return on their “investment.” Now might be a good time to revisit that scheme.

~Nate G.