Romney Will Probably Win the Republican Nomination, But...

All the evidence points to Mitt Romney becoming the Republican nominee. I must eat my words from last year when I doubted that Romney would get the nomination.

Romney will likely win New Hampshire given his campaign apparatus there, the number of moderates who tend to vote in the New Hampshire primary, and his high name recognition due to his run in 2008 and his time as governor of neighboring Massachusetts. That leaves South Carolina as the best early primary state for conservatives to stop him.

Even assuming that Romney loses in South Carolina (far from a foregone conclusion) he will still have a massive war chest and a formidable organization. Santorum does not have the campaign infrastructure or funding to go toe to toe with Romney on Super Tuesday. As of now, Santorum has around $230,000 on hand; Romney had $14,656,966 on hand as of late December. I predict that Romney will soon deliver the knockout blow to his opposition and claim the nomination.

I must confess myself surprised to see Romney doing so well. His claims to electability do not ring especially true. It is true that he was elected Governor of Massachusetts, a state that has reliably supported Democrats on the national stage. He had only one term as Governor after losing a Senate race to Ted Kennedy in 1994, the same year Republicans took control of the House of Representatives for the first time in decades. In 2006, he chose not to run for reelection. It is easy to take a cynical view. 2006 was shaping up to be a good year for Democrats nationwide. In fact, Democrats took control of both houses of Congress. As he was leaving office, his approval was just 34%. I strongly doubt that he would deliver Massachusetts in a general election given its Democratic tilt and his low approval ratings when he left.

What is supposed to make him electable is his economic expertise. Indeed, he does have a relatively detailed economic platform that has been favorably reviewed my many economists. But when he was in office in Massachusetts, employment grew at 1.3% while it grew at 5.4% nationwide. Romney defenders might point to all kinds of explanations for this statistic. Perhaps most tellingly, they might argue that Massachusetts’s entrenched predilection for liberal policies (which supposedly stifled economic growth) and failure to adopt more conservative ones caused the economy not to perform as well as the nation as a whole.

But that raises uncomfortable questions for Romney. First, if he was unable to deliver the economic performance he promises in Massachusetts, how will he do so in Washington? It may have been difficult to push conservative economic policy in Massachusetts. But things will not be considerably easier in Washington. He will face a spirited opposition in the Democratic Party, which will have enough power to filibuster his initiatives at a minimum. It is very possible that Democrats will retain control of one or both houses of Congress. Under these circumstances, Romney will hardly be able to waive a magic wand to dramatically lower taxes or make drastic cuts to popular entitlements like Medicare and Social Security.

Second, if Massachusetts’ liberal economic policies were so poisonous to economic growth, why did Romney end up supporting a healthcare plan which ended up expanding health insurance and requiring citizens to purchase it? Cato, a conservative think-tank suggests that Romney’s plan will cost the state of Massachusetts two billion dollars more than it was originally projected to cost. Is this not the sort of big government project that conservatives have often argued ends up hurting the economy by raising taxes on money that could instead be spent, saved, or invested? In short, Romney’s economic performance when he was actually in a position to affect meaningful policy change seems nothing to write home about.

Because of this, and the fact that Romney wants to run as a Washington outsider, he will point to his time in the private sector where he was able to amass a respectable fortune and build Bain Capital into the company it is today. He will also tout his experience running the 2002 Salt Lake City Olympic Games. But Romney’s time in the private sector will be a double-edged sword. His wealth will make already make it difficult for struggling working-class voters to relate to him. In addition, he will be pilloried for the companies that Bain took over where there were subsequently massive layoffs. Ted Kennedy was able to make use of Romney’s time at Bain quite effectively in their 1994 Senate race.

Can Romney win? Yes. But I believe his fate is entirely tied to the economy. Other candidates would be able to run against Obama’s healthcare mandate or his support of abortion rights to galvanize voters. Because of his past support for the healthcare mandate, he will not be able to use this potentially potent issue in the general election. His record of shifting positions on issues such as abortion and his Mormonism will make some voters he absolutely needs uneasy, and it will cause independents to wonder if he is a genuine man. To put aside such concerns, he needs swing voters to conclude that the economy will not get any better under Obama, and that Obama’s mismanagement of the economy has been so egregious that he simply cannot be trusted with a second term. Voters desperate to improve their economic fortune would then turn to the only alternative—Romney.

On that front, predictions of robust growth in 2012 and declines in the number of people seeking unemployment benefits cannot be especially welcome news. Ironically, a man robbed of all but a market-based critique of Obama’s economic policies is himself entirely at the mercy of the market in this election cycle.

Conservatives and Liberals Overlap on Libya

Democrats and Republicans have sharply divergent views about most political issues today. The proper role of government and how expansive a welfare state there should be are but two examples. Foreign policy though has turned out to be an exception to this rule in recent weeks.

That much has been evident in the debate over American intervention in Libya. Republicans led by John Boehner have been openly skeptical about American involvement. Of course, Republicans are the party that supported the invasion of Iraq wholeheartedly, at least partly on the rationale that Saddam Hussein was a vicious tyrant who needed to be removed to free the oppressed people of Iraq. Interestingly, Boehner has been joined by several Democrats in his criticism of the administration’s involvement in Libya.

Unlike domestic policy, there is not a clear liberal or conservative answer in many foreign policy issues. Take the idea of nation-building in Afghanistan. A hawkish conservative might support it on the grounds that a democratic, prosperous Afghanistan will be an ally in the war on terrorism and in the region. Since this conservative wants to project American influence, nation-building might make sense as an investment. A liberal could support nation-building too on a humanitarian basis to uplift previously oppressed people. Of course, a mix of both motives could cause the liberal and the conservative to support the nation-building effort.

Conservatives have traditionally opposed social engineering, at least in their rhetoric. They also do not want the government doing things that people should (in their view do for themselves). It would be perfectly understandable for small government conservatives to oppose taking on a costly nation-building effort in another country. Liberals have traditionally been wary of imperialism or assuming that western nations have a right to impose their beliefs or value systems on other countries. That could easily explain a liberal’s unease with nation-building.

This all has the potential to leave us confused. What is the liberal answer to the problems in Libya? What is the conservative one?

Leave it to the States?

Mitt Romney had an interesting moment in this week’s debate. When asked about the role of the federal government he said that the government should ask itself what it must do, and then leave the rest to the states, or even better the private sector. Such a policy would improve the debt outlook for the United States.

Or would it? The federal government would benefit as it spent less money on priorities like healthcare, education etc. It would have to borrow less money. But the burden of debt would simply be shifted to the states. This is something the states can scarcely afford at this juncture. For example, the states have more than $1 trillion in pension and healthcare liabilities. And that’s just the beginning. California’s debt may be 37% of the economy. In order to save money, Hawaii instituted a four day school week last year. Asking states to carry an even greater burden would cause some to default.

Moreover, having states with such high debt loads is arguably worse than the federal government having one. The states do not have the same borrowing capacity as the federal government, and do not have the same respectability with foreign creditors who are doing a lot of the lending to America. This means the states can borrow a lower amount before they risk default, and that they may not be able to command as favorable an interest rate, thereby increasing their burden of debt. Since the United States consists of both states and the federal government, what happens in the state matters a great deal. So the country’s overall debt picture will likely not improve simply by telling the states to pay for more programs.

The way that shifting functions to the states would help the overall debt situation is if voters choose not to fund certain things at the state level. But remember that the biggest drivers of the federal debts are entitlements. As it happens, programs such as Medicare and Social Security are the most popular. Even if conservatives managed to outsource these to the states (unlikely), voters would probably choose to continue these benefits at the state level. On the margins, certain states might not fund certain environmental programs or discretionary programs, but again, those aren’t what is bankrupting us.

There may well be good reasons to leave more to the states. Saving money isn’t one of them.

Newt Gingrich's Struggles

It’s difficult to see how Newt Gingrich remains in the race much longer. He was already in trouble going as far back as several weeks ago.

First, he insulted the Paul Ryan plan by saying “I don’t think right-wing social engineering is any more desirable than left-wing social engineering.” Most of the House Republican caucus is behind the Ryan plan, so he upset many Republican congressmen. In order to have a chance to win them back, he probably needed a full throated apology, or explain that his position was mischaracterized. He could have said that he thinks the Ryan plan is reasonable, not right wing social engineering. Instead, Gingrich apologized for the way he made his critique, but not for making the critique in the first place.

Second, Gingrich just had most of his campaign staff quit, including his campaign manager and important workers in early states. They all cited “irreconcilable differences over the direction of the campaign.” In the past days pundits have said that Gingrich wanted to show up at debates and run a social media campaign while aides wanted him to commit to a more traditional campaign, which he refused to do. Regardless, of what these irreconcilable differences are, the mass resignation is a stunning vote of no confidence in him as a candidate.

In some sense, it was always difficult to take Gingrich seriously as a candidate. He has been out of office for more than ten years which is now unusual for someone aspiring to the presidency. Before the campaign began, he was poised to alienate important constituencies in the Republican Party. He had supported cap and trade, as well as a mandate for healthcare that would have upset economic conservatives, and which would have had the added effect of making him look like a hypocrite in the general election for criticizing President Obama’s positions on these issues. His messy personal life—he has had three wives and has admitted to adultery-- could only hurt him with social conservatives. It is not possible to win the nomination without solid support from at least one of these two factions.

I actually worry that Gingrich risks diminishing himself in the campaign. For example, he became the first major politician to sign the sigma six pledge. The pledge goes like this:

First candidates must promise, “to eliminate spending deficits and start paying down the national debt by 2017 by deploying Lean Six Sigma waste reduction methods to detect and eliminate 25 percent of spending per year across the federal government.”

Then “to attend two days of training on the Lean Six Sigma method and complete a waste reduction project prior to my inauguration.”

Signing a pledge like this makes Gingrich look like a desperate panderer, not the intellectual leader of the right that he has sought to become. Gingrich plans to forge on in the campaign. His chances of winning are not 0, but neither are they very high at this point.

Should We Raise the Debt Ceiling?

Washington is still engulfed in an intense debate about whether to raise the federal debt ceiling. In the end, I predict the debt ceiling will be raised in return for some sort of spending cuts, or at least a commitment to cut spending in the future.

The responsible choice is to raise the debt ceiling. Not doing so carries with it the risk of defaulting. In that case, it would be hard to convince people to invest in treasuries for the foreseeable future. If an outright default does not happen, investors would still view the US political system as increasingly dysfunctional and demand higher interest rates, meaning that our debt would grow. This leaves us with two unappealing choices. Taxes could rise which make most people unhappy and decrease the amount of money available for consumer spending and investment at a critical time for the economy. The second option is that our budgets would slowly choke off money for anything besides defense and core entitlements such as Medicare and Social Security. Investments in education, job training, and a safety net for the poor among others would all be hurt.

It is possible to imagine how conservatives might like how either of these scenarios plays out. By preventing the government from borrowing more money if they force default, conservatives would require people to pay higher taxes to finance the level of government spending we have now. They may well bet that when faced with a choice between higher taxes and lower levels of government spending, citizens will choose the latter.

But this does not take into account the short term political fallout that could accrue to Republicans in the event of a government shutdown. Republicans have traditionally opposed government programs more than Democrats. The loudest voices on the right want a dramatic reduction in the federal government’s role in the lives of Americans. Even more mainstream ones such as Paul Ryan want to substantially restructure entitlements like Medicare by making what amount to cuts. It will be easy for Democrats to say they were willing to make compromises, but that Republicans were so bent on gutting Medicare and Social Security that they were willing to let the country default on its debts.

Politically, President Obama stands in a decent position to win. What he needs now is a credible plan to reduce the deficit long term that avoids some of the cuts that the Ryan plan or other conservative variants have. Republicans will then have to acquiesce to his budget in which case they share in any of the political pain, or they can allow the country to default and walk away from a reasonable proposal and be tagged as radicals for a generation for wanting to make changes in popular entitlement programs that the majority of voters will not support.

In this game of chicken between the two parties, the stakes could not be higher. If reasonable choices are not made, America will be the loser.

Christians and Gay Marriage

Gadson Review Readers,

Here is another guest post from Margaret Mou, who posted "A Plea For Religious Tolerance in the Bible Belt" a couple of months ago. The post should be--as the first post was--well worth the read!

Sitting at the table over a bowl of salad and wine, Marcus probes my opinions on religion and politics: two subject areas that out of courtesy and politeness, people usually don’t broach. However, Marcus challenges my perspective, which resulted in solidarity of some aspects, reevaluation of others, and definitely a stronger friendship. So, another thank-you to Marcus.

Food for thought for today: gay marriage (with a Marcus & Margaret twist).

Many argue that marriage is fundamentally a religious institution. Marcus brought up an interesting idea that some advocate: give everyone gay or straight civil unions and let churches define marriage however they wish. Those who support this idea think that civil unions would be a solution to the debate since everyone would be treated equally under the law while churches would still have the freedom to choose which marriages to recognize. Of course, some churches would choose not to allow gays to marry meaning that they would not be able to recieve a fundamental religious rite.

So I retorted with the question, “Should gay Christians have the right to get married?” An assumption implicit in my question is that being gay is often innate and not a chosen way of life (seeing as the Bible has spoken in favor of heterosexuals), as well as the presence in some sort of faith in a traditional Christian church.

I feel like every person should have the right to choose who they want to be with, and that churches should refrain from judgment. Hasn’t religion taught us to be better people, to accept all kinds of backgrounds? And thus, shouldn’t gay Christians also be allowed to have the blessing of the community as well as the rest of the heterosexual Christians?

There’s also the point of the fact that it’s the church’s opinion of whether or not to acknowledge the marriage of individuals, but if I were in charge of the decisions of a church, I’d gladly welcome anyone who chooses to marry under my smiles and love.

And my inner sappiness comes out, wishing each and every individual the ability to find a healthy love and be loved in return, and to celebrate that magic without any hindrances, without any obstacles, and without any scorn from others.

-by Margaret Mou

Thoughts on Osama bin Laden

Osama bin Laden is finally dead. The biggest questions about his death remain unanswered however.

What does bin Laden’s death mean for Al Qaeda and terrorism more broadly? Perhaps terrorists view bin Laden as a martyr and launch a wave of attacks in retaliation. It is without a doubt that there will still be terrorists and that Al Qaeda will continue to operate in some fashion. But I can’t help thinking that getting bin Laden will greatly help America’s counter-terrorism efforts. Bin Laden was the most visible symbol of terrorism in the world. The fact that the US spent over 10 years trying to get him shows that it means business when it goes after terrorists. In effect, if you mastermind attacks, the US will hunt you to the ends of the earth. I think—or at least I hope—that has some deterrent effect on would-be terrorist leaders.

Secondly, what will this mean for Obama politically? In the final analysis, probably not much. George W. Bush saw his approval rating spike after American forces captured Saddam Hussein in 2003 only to see it go back down as the 2004 election approached. Similarly, Obama faces an election coming up next year where the focus will be on the economy, where Obama is not polling so well. So while this may be a short term boon, I doubt it will do much for Obama long-term.

What do you think this will do for Obama’s political fortunes? Take the poll!