Experience the Decision Economics Difference for yourself.
Election 2012: Neither Candidate’s Budget Adds Up
- In what now appears to be a close Election, the Presidential candidates have offered different visions of tax and budget policy for the future.
- President Obama presents more of the same: a few small proposals to prop up the near-term recovery, and a timid plan to reduce the deficit longer-term which would lift taxes on the highest income taxpayers, and make a small dent in the growth of entitlement spending.
- But Governor Romney offers a Plan that could be even worse. Large tax rate cuts without offsetting spending cuts or increased revenues could lead to much higher budget deficits in the medium term, even if they boost economic growth. And his tax plan is internally inconsistent.
- Nonetheless, both candidates’ budgets agree on one thing. Both the Obama and Romney budgets would entail a dramatic shrinking of the general operations of the Government. In Obama’s budget, the general governmental operations would shrink by 40% over 10 years while Romney (or at least Ryan) expects the size to fall by three-fourths (if the budget is balanced), to about where it was when Eisenhower was president. Probably, the American people do not want a government that small, making both of these budgets unrealistic.