Romney lacks clear economic remedy

By Stella Dawson, Reuters

Mitt Romney, the front-runner for the 2012 Republican U.S. presidential nomination, is promising Americans deep spending cuts, smaller government, trade penalties on China, a new Federal Reserve chairman and sweeping deregulation. The bold economic strategy Romney has sketched out in his White House bid seems designed to appeal to the radicalized conservative base of the Republican Party enamored of the gold-standard ideas promoted by libertarian congressman Ron Paul and budget slashers in the populist tea party movement. Romney needs their backing to eventually win his party’s nomination to face Democratic President Barack Obama on Nov. 6. The former Massachusetts governor has won the first two Republican state nominating contests and now has his sights set on the Jan. 21 primary in conservative South Carolina. Economists and political strategists are skeptical that his economic plan will remain so radical as the campaign evolves. It sits uneasily with his track record as a moderate, could alienate independent voters he would need to defeat Obama, and deep, rapid budget cuts would risk tanking a shaky economy growing at a 2 percent pace. “I do think he is quite pragmatic,” said Greg Valliere, political economist at Potomac Research Group. Romney wants to create the image of someone determined to scale back Washington pitted against a big-government president in order to pick up enough voters to secure the Republican nomination quickly. “He has latitude to move back to the center in time for November where the criticism that he is a moderate will be a plus for him” to win over independents, Valliere said. Thomas Gallagher, a former Wall Street economist and principal at the business advisory firm Scowcroft Group, agrees. “I don’t think his economic platform is very predictive of what he would do in 2013.” By laying out a blueprint on his website that lacks much detail, it allows Romney to embrace touchstone issues such as a balanced budget amendment dear to Tea Party activists on the Republican right, while retaining the leeway to shift course later, Gallagher said. This vagueness on economic policy also creates vulnerabilities.

“He is trying to play both sides of the fence which is what worries a lot of conservatives about him. That may play well in the election, but people want some authenticity in what their leaders are telling them,” said James Campbell, political scientist at State University of New York in Buffalo. And if Romney fails to convince the right that his plan is sufficiently anti-tax and anti-big government, it could inspire an independent candidate who would splinter the Republican vote and weaken his chances of winning in November.