Last week, the Commerce Department reported strong GDP growth of 4.9 percent during the summer, but warned that expectations remain grim in the near future as growth slows in the year’s final quarter. As the new year approaches, there are warning signs everywhere that our economy is slowing down and in need of a boost. Oil prices remain high, the housing market continues to slide and the greenback is losing strength. Together, these and other factors are slowly creating the groundswell for a potential recession. While this reality is probable, it is not inevitable.
President Bush’s tax cuts have helped drive economic growth this decade, but the next election will be about who is the best individual to sustain economic growth in the next.
Since day one of his campaign, Mitt Romney made it clear that complacency about our economy was not on his agenda when he became the first candidate to sign the Taxpayer Protection Pledge. He has continued to outline substantive ways to sustain growth and stay ahead of the game to prevent the possibility of a recession. Surprisingly, this sense of urgency is lacking among other Republicans and certainly among the Democrats who want to put us on the fast track to a recession in their classic tax-and-spend fashion. Of the Republicans, however, Rudy Giuliani’s record should give us great unease about entrusting him with the keys to our economic engine at this critical time.
It should come as no surprise that Giuliani has not been straight with voters about his real fiscal record, given his penchant for opposing tax cuts and liberal spending sprees of taxpayer money for billion-dollar sports stadiums. Having spent much time on the campaign trail touting 23 tax cuts he alleges he pushed through as mayor of New York City, it’s becoming abundantly clear that he did no such thing.
As the Boston Globe recently noted, “Giuliani often suggests that he alone was responsible for cutting 23 taxes, but seven of those moves were state initiatives, according to the city’s Independent Budget Office. Of the remaining 16 tax reductions, Giuliani actually opposed the largest cut, which was due to come with the expiration of a 12 1/2-percent surcharge on the city’s personal income tax.” The non-partisan Annenberg School at the University of Pennsylvania has also pointed out that Mayor Giuliani fought Republican efforts to kill the city’s commuter tax, and even went to court to keep it alive. In another instance, they reported that Giuliani opposed a personal-income-tax-rate cut amounting to $469 million — another tax cut he now claims credit for. Giuliani’s spending record is equally troubling, having left New York City with a massive deficit of $2.8 billion, according to the Citizens Budget Commission, a pro-business watchdog group, and the Independent Budget Office.
Governor Romney, on the other hand, received praise for his low-tax, budget-balancing fiscal record from the Massachusetts Citizens for Limited Taxation. As governor, he inherited a nearly $3 billion budget gap in Massachusetts and went on to eliminate it through spending cuts and by opposing tax increases. Governor Romney consistently proposed reducing taxes. Working with the legislature, Governor Romney was able to cut taxes on seniors, consumers, businesses, and commuters.
As a presidential candidate, Governor Romney has outlined a pro-growth, anti-recession economic agenda that would provide the much-needed jolt our economy needs now. He believes we should extend the Bush tax cuts, permanently kill the death tax, provide relief from the Alternative Minimum Tax, lower the corporate tax, and reduce marginal tax rates for all Americans. He also put a bold new pro-growth tax reform on the table: abolishing taxes on capital gains, dividends, and interest for middle-class taxpayers earning $200,000 or less annually. This innovative approach would not only boost savings, investment and economic growth, it would further expand the ownership society to America’s broad middle class.
With the American people understandably concerned about the current deficit, only a candidate with a proven record of fiscal discipline on taxes and spending can command the faith of America’s taxpayers. In addition to tax relief, Romney’s comprehensive pro-growth plan also depends on controlling spending. As President, he will seek to restore the line-item veto that Rudy Giuliani went to court to declare unconstitutional, and his time in Massachusetts (over 800 line-item vetoes) tells us he will not hesitate to use it. This will be a vital tool to enforce his top spending control pledge to veto any non-defense discretionary spending bill that exceeds levels of inflation minus one percent.
As a faithful supply-sider, I know Governor Romney is the best candidate to carry the torch for the Reagan supply-side revolution in the 21st century. Unlike other candidates, Mitt Romney learned about free-market capitalism not from textbooks or congressional committee hearings, but by practicing it for 25 years as an entrepreneur in the private sector. At this time when the economy is weakening, we need a fiscal steward like Mitt Romney in the White House to provide insurance against a recession and help America’s economy remain the envy of the world.
– Cesar Conda, formerly chief domestic policy adviser to Vice President Cheney, is a member of the editorial advisory board of The International Economy Magazine. He is also an economic adviser to the Romney campaign.