Would Romney Be Another Bill Clinton or Another George W. Bush?

Bruce Bartlett held senior policy roles in the Reagan and George H.W. Bush administrations and served on the staffs of Representatives Jack Kemp and Ron Paul. He is the author of “The Benefit and the Burden: Tax Reform – Why We Need It and What It Will Take.”

Mitt Romney has lately been praising Bill Clinton’s economic policy, The New York Times has reported.

Perspectives from expert contributors.

This is a bit surprising, as Mr. Clinton is a Democrat who was widely loathed by Republicans like Mr. Romney when he was in office. Moreover, Mr. Romney seldom mentions the last president of his own party, George W. Bush, often referring to him merely as Barack Obama’s “predecessor.”

From a nonpartisan point of view, this is not surprising. Mr. Clinton consistently governed as a fiscal conservative and Mr. Bush as a liberal. However, Mr. Clinton was not a conservative by today’s standards, but rather by those of an earlier generation.

That is to say, he actually cared about the budget deficit and was willing to raise taxes to reduce it – as Ronald Reagan did 11 times, and George H.W. Bush courageously did even though he knew it would probably cost him re-election.

Today’s conservatives oppose tax increases so strenuously that many were willing to default on the nation’s debt last summer rather than raise taxes by a single penny.

They overwhelmingly believe in a nonsensical theory called “starve the beast,” which asserts that tax cuts automatically reduce spending and tax increases never reduce the deficit because they invariably lead to spending increases.

The Clinton and Bush 43 administrations are almost perfect tests of starve-the-beast theory; the former raised taxes in 1993, while the latter signed into law seven different major tax cuts, according to a Treasury study. If there were any truth whatsoever to starving the beast, we should have seen a rise in spending during the Clinton years and a fall in spending during the Bush years. In fact, we had exactly the opposite results.

Congressional Budget Office

Spending fell 3.2 percent of the gross domestic product under Mr. Clinton and increased 2.4 percent under Mr. Bush, even though taxes rose 3.1 percent of G.D.P. under the former and fell 2 percent under the latter. As a consequence, the national debt fell almost 15 percent of G.D.P. under Mr. Clinton and rose almost 8 percent under Mr. Bush.

But what about the economy? Republicans almost obsessively refer to all tax increases as job-killers. They commonly assert that tax increases would crush the economy and investment. Conversely, they assert that tax cuts are always what the economy needs to raise growth and create jobs.

This is why Mr. Romney; Paul D. Ryan, the chairman of the House Budget Committee; and every other Republican leader say that we must cut taxes, especially for the rich, even as spending for the poor is slashed in the name of fiscal responsibility.

But the record does not support the idea that tax cuts necessarily foster jobs or growth. (I think the Reagan tax cuts worked, because economic conditions were far different than today.)

Bureau of Economic Analysis, Bureau of Labor Statistics

As one can see, contrary to Republican dogma, tax increases did not kill jobs during the Clinton administration. In fact, 23 million jobs were created, compared with one-fourth that number under Mr. Bush. The key reason for this is that real G.D.P. grew twice as fast during the Clinton years as it did during the Bush years: 3.9 percent per year on average compared with 2 percent.

A major factor powering the higher real growth is that nonresidential investment rose sharply during the Clinton presidency but was flat throughout the Bush presidency.

I think Americans are more aware of these facts than Republicans believe. That is why they have consistently blamed Mr. Bush far more than President Obama for the poor state of the economy, as documented in these New York Times/CBS News polls.

Who do you think is mostly to blame for the current state of the nation’s economy?

1. The Bush administration
2. The Obama administration
3. Wall Street and financial institutions
4. Congress
5. Someone else

The New York Times/CBS News polls

Even more surprising is that three-fourths of the way through President Obama’s administration, three times as many people primarily blame Mr. Bush as blame Mr. Obama for the budget deficit, according to the New York Times/CBS News poll.

Who do you think is mostly to blame for most of the current federal budget deficit?

1. The Bush administration
2. The Obama administration
3. Congress
4. Someone else

The New York Times/CBS News polls

No wonder Mr. Romney would rather identify himself with Mr. Clinton than the last president of his own party.

View the original article here