Mitt Romney’s plan to create 12 million jobs in his first term relies on two kinds of policies: ones that are politically improbable, bordering on the impossible, and ones that will be in place no matter who wins next week’s presidential election.
This is the conclusion from a new white paper released this week by Romney and his economic team, which relies on an array of mathematical illusions and policy switcheroos to make the 12 million jobs claim add up. The paper appears to be a response to a brutal set of independent analyses calling that jobs projection into question: “More analysis has shown that the 12 million jobs growth estimate over the next four years with the Romney economic program is more robust than we originally stated,” Romney’s top four economic advisers argue.
Their proof is not that robust.
First, Romney’s team maintains that his policies will suffice to boost America’s employment-to-population ratio by 2 percentage points, from just under 59 percent to 61 percent. Such a change would necessarily mean adding 12 million new jobs. The economists say this is the natural outcome of their preferred policies.
Is it, though? The share of Americans working has been falling, as a general trend, since 2000. The ratio usually dips during recessions but roars back during recoveries. That hasn’t happened under President Obama--the ratio has flatlined since the recession ended--but just as importantly, it didn’t happen under President George W. Bush, whose cadre of economic advisers included three of Romney’s top four economists. Put another way, when Romney’s advisers were last in power, the employment-to-population ratio rebounded by about 1 point after a recession, even with the help of a massive housing bubble.
Second, Romney’s math still doesn’t add up on the micro level. The paper claims that nearly 5 million jobs would be created in his first term if Congress passes a Romney proposal to cut income-tax rates while eliminating some unspecified deductions in order to streamline the tax code. It cites a study by Rice University economist John Diamond. But two months ago, Diamond told National Journal, “I don’t think there’s any chance” a plan resembling Romney’s could pass Congress, because it would mean eliminating or limiting so many politically popular tax breaks.
Equally unlikely is Romney’s projection of 2 million new jobs from cracking down on China over trade. The claim is based on a 2011 study predicting what might happen if China adopts intellectual-property projections identical to America’s, benefitting U.S. firms that sell innovative products there. Nowhere in his platform does Romney explain how he’d bring about such a sea change.
Romney says that a Citigroup report shows his plans to drill more for oil and gas on federal land will create up to 2.5 million jobs in a first term. But economists say it’s likely that those drilling jobs will be created no matter which candidate is elected president. The fracking boom, which began during the Obama administration, is taking place largely on private lands with little involvement from the federal government.
Finally, Romney’s team claims support from a pair of independent forecasts, by Moody’s and Macroeconomic Advisers, that the economy will create 12 million jobs by 2016 regardless of who’s president. The white paper calls these predictions evidence that Romney’s 12 million promise is “an achievable goal.”
Boil Romney’s plan down to actual new proposals that stand a chance of coming to pass, and what remains is an economic agenda that--like President Obama’s--falls far short of what the economy needs to close the “output gap” left over from the Great Recession and ensure that every American who wants to work can find a job.
The electorate gets this. In latest Pew poll of the presidential race, half of voters said that Obama “doesn’t know how to turn the economy around.” But three in five said that Romney “is promising more than he can deliver.”
Coral Davenport contributed