Romney repudiates GOP economic philosophy … no one notices

Updated

In his recent interview with Time’s Mark Halperin, Mitt Romney made a pretty stunning admission—one that undermines the entire basis of the Republican party’s economic platform. And just about nobody noticed until msnbc’s Chris Hayes pointed it out on The Rachel Maddow Show Thursday.

Here’s the exchange between Halperin and Romney:

Halperin: Why not in the first year, if you’re elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you’d like to see after four years in office?  Why not do it more quickly?

Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%.  That is by definition throwing us into recession or depression. So I’m not going to do that, of course.

Wait, hold on. Did Romney just acknowledge that slashing government spending reduces economic growth? And cutting a trillion dollars in spending next year would throw the economy into a recession? Isn’t that exactly what Republicans have been denying, as they push for more cuts?

Indeed, Rep. Paul Ryan—whose budget Romney has wholeheartedly embraced—has been pretty clear on this (at least in recent years): He believes government spending to stimulate the economy doesn’t work. “We are not Keynesians. We don’t believe in demand-side stimulus. We’re going to stop the spending spree,” he told the Wall Street Journal in 2009.

That’s what this whole debate we’ve been having since the economy tanked has been about: Many Democrats have argued we need more government stimulus to jump-start growth. Republicans have countered that this will only add to the deficit and further reduce confidence.

As Hayes, the host of Up With Chris Hayes, marveled Thursday night:

[Romney] conceded the entire theoretical framework of Keynesian stimulus in one sentence as a throwaway line in a Mark Halperin interview! And no one said anything.

So in effect, Romney is now saying that the Ryan budget would have a disastrous effect on the economy. That seems like kind of a big deal. 

This might be one of those tests for the Beltway press corps that Maddow talked about Wednesday night. In a country with a well-functioning press, this would go down as a major “gaffe”—or worse, evidence of an enormous contradiction in Romney’s approach to economic policy.

Halperin flunked. How will the rest do?

Paul Ryan and Mitt Romney

Romney repudiates GOP economic philosophy ... no one notices

Updated