Mitt Romney: Liberal Economist

Say you’re a presidential candidate shifting to the general election after your place as the party's nominee seems firmly settled. The entire logic of your candidacy has been built on business experience as the answer to an economic downturn, and you plan to assail the community-organizer president for not understanding how the private sector works. A high rate of unemployment is your friend. Voters will be dissatisfied enough with the general state of their lives that you should easily waltz past the incumbent president without having to do the tricky work of laying out your own vision for the country. Except, after a year of laying the groundwork for this sort of campaign, the economy slowly begins to recover. Things are certainly not in good shape, but the trend lines are beginning to move in the right direction and people are once again hopeful.

That's the unenviable situation Mitt Romney has found himself. He is on the verge of dismissing his Republican opponents, and a string of victories on Super Tuesday a month from today will likely be enough for Romney to move ahead to the general election. At the same moment he reaches this triumph, the economy is getting better each day. Good for the country, bad for his electoral prospects. New job reports on Friday had January as a stellar month; the country added almost 250,000 jobs and the unemployment rate dropped to 8.3 percent.

That leaves Romney in a bind. He can't admit the gains are bad for him personally, nor can he give credit to Obama. Instead of reassessing the fundamental reasoning for his campaign, Romney has latched onto a different reality that denies the recent improvement. "This week he’s trying to take a bow for 8.3 percent unemployment," Romney said in his Nevada victory speech. “Not so fast, Mr. President," Romney said.  "We welcome any good news on the jobs front. But it is thanks to the innovation of the American people in the private sector and not to you, Mr. President." Romney offered up 15 percent as the "real" unemployment rate, a number that takes into account the vast class of underemployed workers who would prefer to have full-time jobs.

This isn't the first occasion on which the higher figure has been thrown out for a political purpose. Liberal economists agitating for further stimulus have frequently cited the high rate of underemployment. The full picture shows the greater need for stimulus and assistance for those who have borne the hardships of the Great Recession, an unpleasant truth for Republicans who wish to slash every program in sight.

Though the full unemployment figure remains staggeringly high, Romney's opportunistic argument falls flat. Much like the standard measure for unemployment, seasonally adjusted underemployment figures have been steadily dropping. The number rose to 17.2 percent during the height of the downturn, but has been falling since. It was at 16.1 percent at this time last year and has dropped over the past several months as the overall workforce has increased in size. That's not to say that the status quo should be accepted. As Paul Krugman wrote over the weekend, "this encouraging employment report shouldn’t lead to any slackening in efforts to promote recovery. Full employment is still a distant dream—and that’s unacceptable." But as things begin to improve, it becomes increasingly difficult for Republicans to argue against reality: Obama's policies have helped right the economy from a downward spiral, even if they haven't returned the country to where it needs to be.

I, for one, hope Mitt Romney continues to roll out the higher number on the campaign trail; it could help bring attention to the need for further government intervention to help those who are struggling and make it challenging for Republicans to say people are doing just fine the next time they try to cutoff unemployment benefits. But I doubt it will win Romney any political points: as long as general unemployment continues to fall, he'll have to keep referencing lower and lower figures for underemployment as well.

Comments

The other counter-factual argument Romney and his supporters are now testing is that it's the policies of Republican governors that led to the decrease in the unemployment rate.

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