Amateur Mitt Insults the 100% With His 47% Comment
As is well known now, Republican Presidential candidate Mitt Romney was caught on tape explaining to donors that due to various federal handouts and non-existent federal tax bills, 47% of the electorate is out of his reach. If we ignore how impressively amateurish it was for Romney to presume that his every utterance wasn't for public consumption, his comments were an insult to all Americans; ideology be damned.
To be clear, this column is not one meant to defend the federal government's increasingly unctuous and economy-sapping footprint. That so many Americans either don't pay taxes, or receive some form of federal assistance or subsidy is offensive, and it speaks to a tragic turn for a country that was founded on basic notions of limited government alongside freedom to fail or succeed; enterprise always rewarded. Government has grown too large, enterprise has become too expensive as evidenced by still too high tax rates, and one can only hope that we eventually fix our errors such that the myriad barriers to achievement and freedom erected by both parties are removed.
Still, missed by Romney is that most everyone, including Romney once, starts at the bottom. Though we all pay federal, state, Social Security, and Medicare taxes, due to a tax code geared toward social engineering, including conservative engineering (think ridiculous deductions for children, not to mention mortgages), when we enter the labor force and sometimes well beyond (if we do things our federal minders like) our income taxes paid to the feds are mostly returned to us. No doubt this was the case at one time for Romney too, but as his great wealth makes plain, eventually he became major taxpayer.
Here it should be made clear that one of the most shameful aspects of our tax code is that in a country founded to protect the individual human right to pursue happiness, we actually penalize financial achievement with higher tax rates. The latter truth should embarrass us, but for Romney to suggest that the 47% who don't pay taxes at the moment are all takers, and that they don't have aspirations similar to those that made him a great success, is for Romney to not understand the country he'd like to lead.
The United States is the richest country on earth precisely because countless Americans once at the bottom had and have the desire to rise from the stationary state. In that sense, and particularly if Romney were promoting pro-growth ideas (more on that later), many in the 47% he dismisses would and will be clamoring to get to the polls in order to elect him over his economically inept opponent.
Considering government handouts, those too should bother us for them keeping unemployment artificially high, and for sucking the pride out of those who stay on the dole for too long. That said, as recently as six years ago U.S. unemployment was very low; the low rate of joblessness a certain signal that given the choice, most Americans aren't interested in the meager handouts that the feds offer them. Not all, but most Americans want to work. They do because it makes them feel better, plus private sector work usually pays more than what the feds offer up to the unemployed.
Of course, in order to get Americans back to work we don't so much need government meddling as we need the political class to remove the barriers to economic growth. More to the point, economic growth is the answer to what ails us, and is the path to individual achievement that will transform those who receive tax rebates into taxpayers.
Thinking about the above, that's in many ways what's most offensive about Romney's comments. Implicit in them is his belief that his policies only work for half of the country; the other half unsalvageable. In fact, policies of light taxation, little to no regulation, free trade, and a stable dollar work for everyone, and if implemented would lift the boats of all Americans willing to work.
Romney's statements suggest he doesn't think his policies are very effective, and that should offend growth-oriented Republicans, essential groups like Club for Growth, and most notably Romney's VP selection in Paul Ryan. Indeed, Romney should know that Ryan is the face of the hyper-growth wing of the Republican Party; Ryan having learned policy at the knee of the late Jack Kemp.
Kemp once referred to himself as a "bleeding heart conservative", he did because he hated to see people struggle, and he properly felt that his policies would increase the economic chances of everyone if implemented. In promoting his ideas, Kemp was speaking to 100% of the United States, and this included individuals on the other side of the aisle. I know this personally in that at a party in Vail about a year before he died, Kemp told the small gathering that he was even trying to reach then Senator Obama to talk about capital gains rates.
That Romney seemed to think nearly half of America was unreachable about what causes economies to grow speaks to someone who doesn't really believe in the policies he's proposing. That he apparently doesn't should give Republicans pause, or at the very least should have them wanting to achieve clarity.
Considering Romney's actual policies, the answer to why Romney thinks his appeal isn't universal may lay within them. Indeed, despite there being four basics to economic growth, Romney remains reluctant to reduce the price of work for all Americans irrespective of their income. Most stimulative here would be efforts to reduce the burden on the 1% from which so much creativity and investment comes from, yet Romney is squirrely. Looking at regulation, rather than say what he should, that he would press for the abolishment of absurd laws of the Dodd-Frank variety because Dodd-Frank simply won't work, Romney naively presumes that he can mend it.
As for trade, even though the desire to trade is the driver of all work effort, Romney oddly talks up getting tough on China with an eye on restricting what should be an essential freedom. Romney's protectionist streak is a failed one politically because it speaks to decline in a country full of the ambitious, plus it reveals a misunderstanding about economic growth more broadly. Put plainly, the staggeringly low wages that prevail in very poor China don't speak to competition, rather they speak to relatively unproductive workers producing things that would impoverish us were we to try to manufacture them here as Romney proposes. Romney's China policy is backwards looking at a time when limp economic growth requires forward looking policies that view Chinese effort as a certain driver of growth stateside, not a barrier to it.
Most scary of all, within Romney's China stance is an explicit comment that the dollar needs to weaken. Sorry Mitt, we've tried dollar cheapening under Bush and Obama these last eleven years and the results are plain for anyone to see: nosebleed gasoline prices, falling corporate profits in real dollar terms, and high unemployment thanks to the weak dollar driving investment into inflation hedges over productive ideas. Thinking about all this, we can surely hope otherwise, but Romney's policies largely violate the basics to growth, and as such it's perhaps true in his case that his ideas would offend nearly half the electorate. What Romney doesn't understand, however, is that many of those most like to be offended by his policies are part of a very real base of Republicans who desire economic growth above all else.
The good news for Romney is that he's still running against the failed economic presidency of Obama. That in mind, Romney's got 48 days to retreat from his mostly mediocre policy platform with an eye on growth. If so, he wins. But if he's going to win, it's essential that he understand that the party of Ronald Reagan and Jack Kemp thinks its policies are best for everyone irrespective of ideology. If Romney doesn't realize this in time, it's fair to say he'll help re-elect a man the electorate would love to rebuke: Barack Obama.
