A good plan vs. no plan

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If you read only one op-ed today, I’d recommend this item from Obama campaign advisor Jeffrey Liebman in the Wall Street Journal. It’s tough to summarize the nature of the debate over jobs and its connection to the presidential race in 800 words, but Liebman, a professor of public policy at the Harvard Kennedy School, pulls it together nicely.

The defense of President Obama’s jobs agenda is pretty straightforward: the economy lacks demand, is held back by public-sector layoffs, and desperately needs infrastructure investments, and the White House plan addresses exactly what’s ailing us. But what stands out is Liebman’s assessment of the president’s challenger.

What would Gov. Romney do to create jobs now? In a word, nothing. In fact, the proposals he has put forward would slow the recovery, reversing the gains we have made since the recession ended.

Gov. Romney himself has acknowledged that excessive spending cuts can have a damaging impact on the economy…. If Gov. Romney is correct about the impact of spending cuts, then the House budget, which cuts spending by $187 billion in 2013 relative to the president’s budget, would reduce economic output by about 1%. That would shrink employment next year by more than one million jobs.

The rest of Gov. Romney’s economic agenda – $5 trillion in deficit-increasing tax cuts with no plausible path to pay for them, divesting from clean energy, and repealing rules of the road for Wall Street – would almost certainly undermine confidence in the U.S. economy and reduce employment further. But even if you dismiss this risk, what is clear is that there is no plausible argument for how Mr. Romney’s policies would address the jobs crisis we face today.

That strikes me as unambiguously true. In fact, in my dream, head-in-the-clouds, hopelessly-naive vision of how the 2012 presidential race should play out, voters would be presented with two competing options on the nation’s top issue: Obama would explain the economic benefits of his plan, while Romney would highlight the benefits of his plan.

Voters would consider the two options and choose the superior plan.

Of course, at least at this point, that’s impossible – not because voters wouldn’t bother to evaluate two competing economic agendas, but because Romney doesn’t dare offer a detailed plan. As Ari Berman recently put it, “Obama Has a Jobs Plan. Romney Doesn’t.”

This isn’t to say Romney’s platform is a complete mystery. We know from his speeches, ads, and website what he intends to do in a general sense: roll back access to health care, slash taxes, increase military spending, relax Wall Street safeguards, expand oil drilling, etc. The Republican candidate avoids specifics and policy details, but we can analyze Romney’s intended plan based on the broad outline.

We can also take what we know and determine whether Romney’s approach would lower unemployment. There’s no great mystery here: while independent analysis found Obama’s Americans Jobs Act would create as many as 1.9 million jobs in 2012, independent analysis also finds that Romney really doesn’t have a jobs plan at all.

As Greg Sargent recently talked to two nonpartisan economists about Romney’s stated goals.

“Are all these things going to reduce the unemployment rate from eight to five in two years? No,” Joel Prakken, the chairman of Macroeconomic Advisers, tells me. He described Romney’s ideas as a “a bundle of reasonable policy proposals that could well stimulate the economy from the supply side over a number of years, but would do little to stimulate aggregate demand in the short run. The reason that unemployment is as high as it is is inadequate aggregate demand, not inadequate supply.”

“On net, all of these [Romney] policies would do more harm in the short term,” added Mark Hopkins, a senior adviser at Moody’s Analytics. “If we implemented all of his policies, it would push us deeper into recession and make the recovery slower.”

If Romney and his team disagree, no problem. I propose a simple challenge: both major party campaigns should produce detailed jobs plans, then allow independent economists to scrutinize them and publish the results. May be the better agenda win.

I think Team Obama is up for it. How about Team Romney?

A good plan vs. no plan

Updated