Mitt Romney ran several businesses, he understands economics and he was a conservative Republican elected to be Governor of Massachusetts — a very liberal Democratic state.
So he might know a thing or two about the stimulus now kicking around Washington DC.
“The Obama spending bill would stimulate the government, not the economy,” he says.
This caught my eye because I’ve been following the economic meltdown in California. In that state, the only economic sectors that “grew” last year were health care and government.
That means the employers hiring people were hiring health care or government workers: not workers in factories, those involved in say, trade, like seaport workers; or other kinds of skilled professionals.
Even the Silicon Valley workforce was not growing as fast as the government.
After the stimulus we might see this growth in government nation wide — which is part of the reason that governors and mayors like this stimulus.
But why doesn’t Romney like the stimulus, as a former governor?
“As someone who spent a career in the private sector, I’d like to see a stimulus package that respects the productivity and genius of the American people. And experience shows us what it should look like,” Romney says.
In other words, companies that hire things and sell things make for more real growth than a growing government.
Romney has a very good view of the stimulus which is on CNN:
any new spending must be strictly limited to projects that are essential. How do we define essential? Well, a good rule is that the projects we fund in a stimulus should be legitimate government priorities that would have been carried out in the future anyway, and are simply being moved up to create those jobs now.
As we take out nonessential projects, we should focus on funding the real needs of government that will have immediate impact. And what better place to begin than repairing and replacing military equipment that was damaged or destroyed in Kuwait, Iraq and Afghanistan?
Third, sending out rebate checks to citizens and businesses is not a tax cut. The media bought this line so far, but they’ve got it wrong. Checks in the mail are refunds, not tax cuts. We tried rebate checks in 2008 and they did virtually nothing to jump-start the economy. Disposable income went up, but consumption hardly moved.
Businesses aren’t stupid. They’re not going to invest in equipment and new hires for a one-time, short-term blip. What’s needed are permanent rate cuts on individuals and businesses.