But perhaps Romney isn't as hardline as he wants us to believe. On Tuesday morning, Romney announced the four members of his economic-policy team. And three of the four are on-the-record supporting deals that would raise taxes.
Harvard's Greg Mankiw founded the Pigou Club to advocate for a tax on carbon. "A $1 per gallon hike in gas tax would bring in $100 billion a year in government revenue and make a dent in the looming fiscal gap," he said. Columbia Business School's Glenn Hubbard has argued that though marginal tax rates do significant damage to the economy, there's a good case to be made for raising revenues through closing loopholes and shaving tax expenditures. And ex-Minnesota Congressman Vin Weber was an enthusiastic backer of Simpson-Bowles, which raised taxes by about $2 trillion over 10 years. Only Jim Talent, the former senator from Missouri, hasn't confessed to an interest in stabilizing the debt through a deal that includes revenues.
You won't find such moderate sentiments in Romney's just-released jobs plan, of course. In that, he sticks close to the Republican party line. But he does so in style. The document, which runs to more than 150 pages, includes fulsome testimonials from business leaders, and has an index listing 59 specific policy recommendations, is as slick as anything any general-election campaign has put out. It's really a very nice piece of work. And that's rather the point. Romney is preempting President Obama's jobs speech with a plan that, at least stylistically, is both more sweeping and more specific than what Obama is likely to release on Thursday. He's showing he can play on the turf where the general election will be fought.
Tuesday's Washington Post/ABC News poll backs him up. He's trailing Rick Perry among Republican voters but outpacing him against Obama. Romney's strategy for beating Perry is to show he's the Republican with the best chance of beating Obama. But his strength against Obama comes, in part, because many voters suspect he's not quite as conservative as some of the others on that stage. In the Republican primary, that's a liability. Mitt Romney may be ready for the primetime, but is the GOP?
Five in the morning
1) Mitt Romney has unveiled his jobs plan, report Philip Rucker and Karen Tumulty: "The far-reaching economic plan that Republican presidential candidate Mitt Romney put forward on Tuesday relies heavily on the premise that reviving the economy depends on getting the government out of the way of corporations...His is a collection of business-friendly ideas that fit neatly within the mainstream of the Republican Party, with a few innovative proposals sprinkled throughout, namely tougher stances on China and labor unions...He laid out 10 actions he said he would take on his first day in the Oval Office that would create more certainty for businesses. They include five measures that would: lower the corporate tax rate to 25 percent from 35 percent; implement free-trade agreements with Colombia, Panama and South Korea; expand domestic energy exploration; consolidate worker retraining programs and turn them over to the states; and cut non-security discretionary spending by 5 percent."
Read the plan: http://mi.tt/pEzIxq
@MikeMemoli : "Club for Growth: 'Governor Romney deserves praise for his specific plan to put America on a path to economic prosperity.'"
2) The Obama administration is turning to an expanded payroll tax cut as a second-best option, reports Jackie Calmes: "The centerpiece of the job creation package that President Obama plans to announce on Thursday -- payroll tax relief for workers and perhaps their employers -- is neither his first policy choice nor that of many economists. But it is the one that they figure has the best chance of getting Republicans’ support...Both the administration and many economists, including those at the nonpartisan Congressional Budget Office, agree that some spending measures, in particular unemployment compensation and aid to states to avert layoffs, have more 'bang for the buck' than many tax cuts -- that is, for each dollar of cost to the federal government, more than a dollar is added to the economy’s output. Generally, such programs keep money in people’s pockets that they quickly spend, whereas high-income taxpayers tend to save."
3) The Fed is considering buying up long-term Treasuries, reports Neil Irwin: The Federal Reserve is moving toward new steps aimed at lowering interest rates on mortgages and other kinds of long-term loans, without making another massive infusion of money into the economy. When Fed officials hold a pivotal meeting in two weeks, they will strongly consider buying more long-term Treasury bonds, which should lead to lower interest rates for those bonds and other long-term investments. This would ultimately make it cheaper for businesses to borrow money for investments and push more dollars into the stock market, in addition to reducing rates on mortgages and other consumer loans. To pay for the bond purchases, the Fed would sell off some of the shorter-term bonds it already owns rather than printing new money."
See where different Fed members stand: http://on.wsj.com/qF1r6w
4) Patent reform is near passage, report Amy Schatz and Don Clark: "A patent-system overhaul nearly a decade in the making is expected to receive final congressional passage this month, significantly altering how anyone with an invention--from a garage tinkerer to a large corporation--will vie for profitable control of that idea's future. The bill, which passed a key Senate vote Tuesday and is expected to get President Barack Obama's signature, will reverse centuries of U.S. patent policy by awarding patents to inventors who are 'first to file' their invention with the U.S. Patent and Trademark Office. Currently the 'first to invent' principle reigns, which often spawns costly litigation between dueling inventors. The new system puts a premium on inventors with the wits--or deep pockets--to dash to the patent office as soon as they discover something useful and nonobvious."
Everything you need to know about patent reform in one post: http://wapo.st/qLhgzv
5) Boehner and Cantor want a pre-speech meet-up on jobs, reports Felicia Sonmez: "House Speaker John Boehner (R-Ohio) and Majority Leader Eric Cantor (R-Va.) on Tuesday penned a letter to President Obama suggesting areas of potential agreement on job-creation and proposing a meeting between the White House and bipartisan congressional leaders ahead of the president’s Thursday jobs speech...'Our hope is that both parties can work together in the coming weeks to reduce excessive regulation that is hampering job growth in our country,' they write. 'To facilitate such efforts, we hope that prior to your address to a Joint Session, you will disclose the cost estimates for the remaining 212 new regulatory actions planned by your administration.'"
Soul cover interlude: Peter, Bjorn and John play "Try a Little Tenderness" by Otis Redding.
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Still to come: Republicans love Obama's consumer protection nominee, will block him anyway; advocates want Obama to fix an insurance subsidy glitch in health care reform; farmers want laxer immigration laws (and getting GOP support); this Congress should be more of the uneventful same on energy; and a cat is confounded by a printer.
Senate Republicans like Richard Cordray, will block him anyway, reports Ylan Mui: "Senate Republicans expressed support Tuesday for President Obama’s nominee to lead the new Consumer Financial Protection Bureau but remained opposed to his confirmation without significant changes to the agency. Their stance leaves the agency’s leadership in limbo and prevents it from using its full array of powers. Forty-four GOP senators have called for the bureau to be run by a five-member commission, rather than a single director, and for it to go through Congress for funding, rather than the Federal Reserve. Sen. Richard C. Shelby (Ala.), the ranking Republican on the banking committee, said that Democrats have ignored those requests. Without those changes, Republicans have vowed to block any nominee...On Tuesday, Sen. Bob Corker (R-Tenn.) called a recent meeting with Cordray 'pleasant,' and Shelby said the nominee had a 'good background.'"
We need to fix the housing market, and no one knows how, reports Josh Boak: "President Barack Obama and Congress are confronting a historic obstacle in their efforts to revive the stalled economy: a crippled housing market unlikely to rebound for several years...Lately, some administration officials have anonymously floated a plan to let mortgage holders refinance at lower rates, which would be in addition to an existing program that has helped more than 790,000 delinquent borrowers modify their home loans. 'It’s not the difference between a 4 percent and 6 percent interest that’s causing people to go into foreclosure,' said Stan Humphries, chief economist for real estate services firm Zillow. 'Unfortunately, the market is going to have to heal itself on that front.' Fed policy has pushed mortgage interest rates to an astoundingly low 4.22 percent. But a stream of buyers has yet to materialize."
The supercommittee has a Democratic deputy staff director, reports Seung Min Kim: "The deficit-cutting supercommittee continues to staff up, adding Sarah Kuehl, a senior budget analyst for Democrats on the Senate Budget Committee, as the panel's deputy staff director. 'Sarah brings a tremendous range of budgetary and legislative experience to this Committee and she will be a strong asset to all of the members,' panel co-chairs Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Texas) said in a joint statement...Kuehl, who has worked in the Senate for more than 13 years, has had her hands in several major bills, including the health care reform law and a wide range of budget and appropriations bills. She also advised Senate Budget Committee Chairman Kent Conrad (D-N.D.) when he served on the Bowles-Simpson fiscal commission."
The Georgia job-training program Obama might scale up has flaws, reports John Gramlich: "As he prepares to announce a new set of job-creation proposals this week, President Obama is looking closely at a Georgia program that has found a rare sweet spot in the hyperpartisan world of Washington politics: It is popular with Republicans as well as Democrats, and it has drawn praise from job-seekers as well as those who do the hiring...But a closer look at Georgia Works shows that the idea, popular though it is, comes with its own set of challenges. Perhaps the most ominous for Obama is that it has not made much of a dent in Georgia’s 10.1 percent unemployment rate, eighth-highest among the states. In July, Georgia was last in the nation in year-over-year job creation, shedding 92,300 jobs. In the same month, just 14 job-seekers statewide were paired with employers under Georgia Works."
Many in the US are falling out of the middle class, reports Michael Fletcher: "Nearly one in three Americans who grew up middle-class has slipped down the income ladder as an adult, according to a new report by the Pew Charitable Trusts. Downward mobility is most common among middle-class people who are divorced or separated from their spouses, did not attend college, scored poorly on standardized tests, or used hard drugs, the report says. 'A middle-class upbringing does not guarantee the same status over the course of a lifetime,' the report says. The study focused on people who were middle-class teenagers in 1979 and who were between 39 and 44 years old in 2004 and 2006. It defines people as middle-class if they fall between the 30th and 70th percentiles in income distribution, which for a family of four is between $32,900 and $64,000 a year in 2010 dollars."
The SEC is throwing in the towel on its proxy-voting rule, reports David Hilzenrath: "The SEC has conceded defeat in the legal battle over one of its most far-reaching steps in years, a plan to make it easier for shareholders to toss out corporate directors. SEC Chairman Mary L. Schapiro said late Tuesday that the agency will not appeal a recent court decision invalidating the initiative. The result is a major victory for corporate groups such as the Business Roundtable, which represents chief executives of big corporations, and the U.S. Chamber of Commerce. They sued to block the so-called 'proxy access' rule. The announcement is a defeat for institutional shareholders such as pension funds and labor unions, which argued that greater democracy in the boardroom would make corporate leaders more accountable."
Supercommittee should fix perverse incentives in the tax code, writes Peter Orszag: "If the committee wants to bring about constructive tax reform that is a bit less ambitious, however, here’s an idea: Change the tax breaks that are meant to encourage people to do good things -- such as save for retirement, buy real estate, get health insurance or give to charity -- into flat-rate credits that aren’t affected by the taxpayer’s income...If a person with a high income contributes $1 to his 401(k) plan, he saves 35 cents in income taxes...A middle-income person contributing the same amount to a 401(k) would save only 15 cents in income taxes...In a 2006 paper, Jonathan Gruber...William Gale...and I laid out a specific way to make it work. We proposed replacing the current deduction for retirement saving with a 30 percent matching contribution from the federal government for every dollar put into a tax- preferred retirement account."
We need hundreds of billions in new stimulus, writes Lawrence Katz: "A net job-creation tax credit for the next two years could provide a powerful incentive for private-sector employers to speed hiring and create momentum for a jobs recovery. Private employers who increase employment would get a tax credit to cover a substantial share (say 40 percent) of the payroll costs of net new hires; they would get a check even if they didn’t owe taxes...Second, increased federal spending of at least several hundred billion dollars a year for the next two years is needed to offset weak private-sector demand and crumbling state and local government finances. I would emphasize aid to state and local governments to prevent further layoffs and to increase spending on infrastructure for public schools and community colleges...Third, the work force investment and re-employment system needs to be revamped."
Adorable animals confounded by technology interlude: A cat encounters a fax machine.
Advocates want Obama to fix a glitch affecting insurance subsidies, reports Julian Pecquet: "The Obama administration is under increasing pressure from its healthcare reform allies to fix a glitch in the law that could leave millions of families without access to affordable coverage. The law, as The Hill first reported in July, would preclude some workers' families from getting subsidies in new state health insurance exchanges if they turned down employer-sponsored family coverage that might be unaffordable. The administration had vowed to address the glitch, but recently proposed regulations would still leave many families in the lurch, prompting one children's advocate to say he was 'profoundly disappointed' with regulators...Even stalwart administration allies like the liberal Center on Budget and Policy Priorities are calling out regulators."
Romney's health plan calls for Medicaid block grants, reports Sam Baker: "Republican White House hopeful Mitt Romney said Tuesday he would issue an executive order to slow implementation of the healthcare law on his first day in office if he were elected president. Romney also proposed major changes to Medicaid and said his plan for Medicare will be similar to Rep. Paul Ryan's (R-Wis.) controversial proposal...If elected president, Romney said, he would issue an executive order on his first day in office that 'directs the Secretary of Health and Human Services and all relevant federal officials to return the maximum possible authority to the states to innovate and design health care solutions that work best for them'...Romeny's plan also proposes converting federal Medicaid spending into block grants for states."
Farmers are pushing for laxer immigration laws, reports Miriam Jordan: "Recent Republican solidarity on illegal immigration is showing cracks under pressure from agriculture groups, with two GOP congressmen floating programs that would make it easier for foreigners to work legally in U.S. fields and orchards. Labor researchers say more than 1.4 million people are employed as field workers in the U.S. each year, and the Labor Department estimates more than half of them are here illegally. Grower groups say that number exceeds 75%, and say measures pending in Congress could deprive Americans of homegrown food...Rep. Lamar Smith (R., Texas), an immigration hardliner who now heads the House Judiciary Committee, plans to introduce a bill Wednesday that would revise an existing guest-worker program and allow up to half a million foreign farm workers a year to work in the U.S."
Richard Shelby's fiscal conservatism isn't stopping him from pushing for NASA funding, reports Manu Raju: "Republican Sen. Richard Shelby has been one of Barack Obama’s most persistent critics, accusing the president of putting the country on a road to financial ruin with deficits as far as the eye can see. But his demands to slash government programs tend to stop at the Alabama state line. Here in his home state, Shelby has been pressuring the Obama administration to spend billions to build what could become the world’s biggest rocket at NASA’s Marshall Space Flight Center in Huntsville -- a government project that would affect thousands of jobs, benefit a network of powerful industry interests and fill a major void at the agency after the collapse of the Bush-era Constellation initiative and the end of the space shuttle program in July."
A government shutdown could still be ahead, writes Jonathan Bernstein: "Congress has certainly not made much progress on Appropriations bills; the House has passed only six, and the Senate has passed its version of one of those. So it seems unlikely that even one Appropriations bill will be signed into law by the end of the month. And yet we're certainly under a month away from a possible shutdown. So what explains the lack of hype about it? It could be that everyone 'knows' that Congress will pass a clean spending extension (a continuing resolution,or 'CR') that will postpone the deadline for several weeks while keeping current spending levels and policy in place. Or, it could be that everyone 'knows' that Barack Obama will be willing to sign (and the Senate willing to pass) a short-term CR that would incorporate House-passed new spending levels and policy changes. As the scare quotes indicate, it's possible that everyone believes one of these things is going to happen but that everyone is wrong."
We need disclosure to make Citizens United work, write John Coates and Taylor Lincoln: "The Supreme Court’s January 2010 Citizens United decision to permit corporations to spend unlimited sums to influence federal elections was premised on a pair of yet-unfulfilled promises: Corporations would disclose their expenditures, and shareholders would be able to police such spending. The best chance to fulfill those promises may now rest with the Securities and Exchange Commission. The SEC could require disclosure of political spending by public companies and facilitate action by shareholders to sign off on such spending. Contrary to the consensus view, however, SEC action may prove to be a favor to the owners of the affected corporations...Research we are publishing Wednesday suggests that disclosure of political activity might benefit corporate valuations and, at the least, mandatory disclosure would pose no threat of a detrimental effect."
Animated short interlude: "Little Boat."
With Congress back, both parties' energy agendas are mostly symbolic, reports Darren Goode: "Congress is back this week and that means lawmakers will resume their largely symbolic debate over energy policy and Environmental Protection Agency regulations -- one that will set the parameters for their tussle over spending strategy for next year. With spending bills and the deficit supercommittee looming, Senate Democrats plan to include energy items in a broader jobs agenda, while House Republicans look to continue to target a host of EPA regulations they view as job killers. But both the House Republican and Senate Democratic agendas have little chance of passage on their own -- acting predominantly as marketing tools heading into the 2012 election. They set the boundaries, though, for each side’s attempt to slip what it can into a fiscal year 2012 omnibus spending package."
Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams.