Santorum Lays Out Economic Agenda
Accusing Mitt Romney of "tinkering at the margins," Rick Santorum takes to the pages of the Wall Street Journal today to lay out his campaign's "pro-growth and pro-family Economic Freedom Agenda." See the column for full details, but here's the gist:
- Increasing domestic energy production, including approving the Keystone XL pipeline and giving the states more flexibility to approve energy exploration and fracking regulations.
- Repealing all Obama-era regulations with a cost to the economy of over $100 million.
- Two income tax rates -- 10 percent and 28 percent -- along with a tripling of the deduction for children and elimination of the marriage penalty.
- Cut the corporate tax rate in half (interestingly, the WSJ piece is totally silent on the proposal to eliminate the tax altogether for manufacturing)
- Spending cuts of $5 trillion over five years, plus a 10 percent cut in the federal workforce (excluding defense).
- A Balanced Budget Amendment that includes a cap for federal spending at 18 percent of GDP.
- Five free trade agreements in his first year in office (Santorum doesn't specify with whom).
- Repeal and replace Obamacare
- "Cut means-tested entitlement programs by 10% across the board, freeze them for four years, and block grant them to states." Plus reforms to Medicare and Social Security to make them "fiscally sustainable."
- Phasing out Fannie Mae and Freddie Mac.
What do you think? For my money, it's a decent package, although it suffers -- as most election-year promises do -- from a reach that probably exceeds its grasp. I also don't know that it's going to create a particularly stark contrast with Romney -- while they may differ on the details, the principles behind a lot of these proposals would receive almost universal assent from the Republican field.
A few minor quibbles: a two-tiered income tax system, with an 18 percent gap between the two rates, is an invitation for distortions as people attempt to avoid the higher bracket. While I prefer a flat system, if you're not going to have one it behooves you to keep the increase between brackets modest. I'm not a big fan of upping the child tax credit either, which (even though it's a fairly innocuous iteration) still reeks of making social policy through the tax code.
Finally, while I'm deeply sympathetic to the goal, I've never thought the Balanced Budget Amendment worth the candle. It's an awful lot of effort to erect a system that Congress will inevitably find a workaround for, much as they do in states like California.
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Nov '11
Re: Santorum Lays Out Economic Agenda
The best predictor available for future performance is past performance.
Perhaps someone who knows the man's record can comments and provide linkage.
Is there anything in the man's extensive record as a US Senator to indicate these are legitimate plans or rather than the empty promises of a candidate running for his party's nomination?
Aug '11
Re: Santorum Lays Out Economic Agenda
I think we need someone who can speak to the future, to our aspirations. It's no secret that I thought Gingrich's moonbase, crazy as it sounded, planted more seeds of hopefulness than all the hopey-changey nonsense ushering from our unserious Current Occupant.
Basically, I like us better when our reach exceeds our grasp. Precisely because we're reaching for something. Which is far better than walking around with our hands in our pockets in a permanent hunch. (Besides, it's hard to walk around with your hands in your pockets when the government's hands are already there.)
Re: Santorum Lays Out Economic Agenda
Drew,
Artfully put and I couldn't agree more. To synthesize your point with Fred's above, another virtue of Newt's is that he has the track record of actually figuring out how to move the goal posts and grab a hold of the seemingly ungraspable. That may be moot at this point in the campaign, but it's not nothing.
DrewInWisconsin: .
Basically, I like us better when our reach exceeds our grasp. Precisely because we're reaching for something. Which is far better than walking around with our hands in our pockets in a permanent hunch.
May '10
Re: Santorum Lays Out Economic Agenda
The only way this government is going to stay afloat is if it aims for far greater reform than what people generally agree is possible.
I would prefer tax credits be eliminated entirely, too. But I doubt the tax code can be fundamentally reformed except in the case of a "Save us! Do anything!" political moment, such as FDR had with the Great Depression and WWII. In other words, the economy will have to get much worse before a complete overhaul of the national income tax becomes politically possible. But don't worry! Such a moment is coming. It might begin when Europe finally falls apart.
Mar '11
Re: Santorum Lays Out Economic Agenda
I also don't know that it's going to create a particularly stark contrast with Romney
Tactical question: Given that Romney's appeal is his supposed managerial mastery, doesn't it tactically behoove Santorum to match Romney wonk for wonk and force a vote on other issues?
Feb '11
Re: Santorum Lays Out Economic Agenda
Troy,
I agree with you about the balanced budget amendment. There's always a workaround, and if there isn't then we've tied the hands of Congress too tightly. The solution is to elect a virtuous Congress. Furthermore, I hate the idea of establishing a % of GDP as the government's cut.
Aug '10
Re: Santorum Lays Out Economic Agenda
It will be interesting to see if Santorum has dropped his proposed elimination of the corporate income tax on manufacturers, which was a horrible idea for several reason. (If Ricky is still singing that tune I will publish a post later in the week detailing why it would be bad policy).
At any rate, it's fairly clear that economics is not Santorum's strong point. He has no real world experience in business and his senate record for fiscal matters is spotty at best.
Having nominated a guy last time who admitted he didn't know much about economics, I think it unwise to do so again.
Mar '11
Re: Santorum Lays Out Economic Agenda
Santorum's goals of tripling the child tax credit and eliminating the marriage penalty are likely aimed at halting the contraction of the American family, an issue that Mark Steyn pays his mortgage with. I believe he thinks that he couldn't triple the tax credit without eliminating the marriage tax because doing so would only encourage "baby daddy" syndrome.
While I agree that targeting these things "reeks of social policy through the tax code," doesn't having a byzantine tax code such as ours make avoiding targeted cuts virtually impossible?
Edited on February 27, 2012 at 9:11pmMar '11
Re: Santorum Lays Out Economic Agenda
Frozen Chosen: It will be interesting to see if Santorum has dropped his proposed elimination of the corporate income tax on manufacturers, which was a horrible idea for several reason. (If Ricky is still singing that tune I will publish a post later in the week detailing why it would be bad policy).
At any rate, it's fairly clear that economics is not Santorum's strong point. He has no real world experience in business and his senate record for fiscal matters is spotty at best.
Having nominated a guy last time who admitted he didn't know much about economics, I think it unwise to do so again. · 15 minutes ago
You should write that post anyway. Admittedly, my knowledge of economics is limited to what I've gained through the Mises, Friedman, Hazlitt, Sowell, etc. books in my library, but what your objection could be doesn't immediately come to mind. I'd love to read what you have to say on the subject.
Edited on February 27, 2012 at 9:06pmJul '11
Re: Santorum Lays Out Economic Agenda
Medicare and Medicaid are non sustainable without massive rationing and cost controls on every level. No one in our country has the stomach for this. Very few on Ricochet have the stomach to deal with this on a rational level either.
These health care agencies will swallow our budget whole in 40 years and yet they remain and have expanded.
Aug '10
Re: Santorum Lays Out Economic Agenda
Gus Marvinson
Admittedly, my knowledge of economics is limited to what I've gained through the Mises, Friedman, Hazlitt, Sowell, etc. books in my library, but what your objection could be doesn't immediately come to mind. I'd love to read what you have to say on the subject. · 8 minutes ago
Edited 7 minutes ago
I don't really have time to elaborate now but to sum it up this would have the feds pick winners and losers in the market, which is never a good idea.
The other big problem is identifying who qualifies as manufacturer, which wouldn't be easy in a complex economy like our. My guess is that Rick doesn't really understand the ramifications of such a policy but is merely blowing smokestacks up blue collar skirts - not that Mr Integrity would ever pander to voters, of course.
Mar '11
Re: Santorum Lays Out Economic Agenda
Earlier in the post you use the term deduction. Is it clear he's referring to the child tax credit, and not the personal exemption you can claim for children? One reduces your federal taxable wages and the other gives you cash whether you paid anything in or not. I agree that both amount to using the government to advance an agenda, but personal exemptions have a long history compared to the Bush era tax credits.
Jul '11
Re: Santorum Lays Out Economic Agenda
I'm actually encouraged that Santorum would increase child tax credits. The way generational wealth transfers are currently set up (SS, Medicare, etc.) there is a disincentive to have children. This exacerbates our budgetary problems because fewer people = less wealth. Child tax credits will help counter that downward spiral.
-E
Mar '11
Re: Santorum Lays Out Economic Agenda
Frozen Chosen
I don't really have time to elaborate now but to sum it up this would have the feds pick winners and losers in the market, which is never a good idea.
The other big problem is identifying who qualifies as manufacturer, which wouldn't be easy in a complex economy like our. My guess is that Rick doesn't really understand the ramifications of such a policy but is merely blowing smokestacks up blue collar skirts - not that Mr Integrity would ever pander to voters, of course. · 3 minutes ago
I agree with you that picking winners and losers is bad, but aren't there already loopholes that pick winners and losers among corporate manufacturers and wouldn't eliminating corporate taxes on all of them actually result in less picking?
Mar '11
Re: Santorum Lays Out Economic Agenda
CandE: I'm actually encouraged that Santorum would increase child tax credits. The way generational wealth transfers are currently set up (SS, Medicare, etc.) there is a disincentive to have children. This exacerbates our budgetary problems because fewer people = less wealth. Child tax credits will help counter that downward spiral.
-E · 3 minutes ago
This strikes me as 2 wrongs trying to make a right. Better we radically reform the generational wealth transfers.
Oct '10
Re: Santorum Lays Out Economic Agenda
It is dismaying to hear so many people argue only for incremental changes around the margin to a tax system which is manifestly dysfunctional and which creates a system of disincentives to productive effort which are so perverse it is almost impossible to even figure out what they are. (As I like to say, however complicated the laws of physics may be, at least they don't change every time the legislature is in session.)
But even barring structural changes to the system, details on the margin, and in particularly the marginal rate itself are mutable. Consider:
In a mere quarter century, from 1963 to 1988, the top marginal rate dropped from 91% (confiscation) to 28% (you get to keep more than ⅔ of what you earned), and this without any major changes to the tax code. If such a change can happen, given crisis to motivate it, cannot the entire absurd and counterproductive tax code be jettisoned in favour of something more rational?
Jul '11
Re: Santorum Lays Out Economic Agenda
kgrant67
CandE: I'm actually encouraged that Santorum would increase child tax credits. The way generational wealth transfers are currently set up (SS, Medicare, etc.) there is a disincentive to have children. This exacerbates our budgetary problems because fewer people = less wealth. Child tax credits will help counter that downward spiral.
-E · 3 minutes ago
This strikes me as 2 wrongs trying to make a right. Better we radically reform the generational wealth transfers. · 18 minutes ago
Fair enough; if we can eliminate SS and Medicare, I would gladly eliminate child tax credits. But how do we get there?
-E
Dec '10
Re: Santorum Lays Out Economic Agenda
I like a few things from his plan:
Aug '10
Re: Santorum Lays Out Economic Agenda
The King Prawn: I like a few things from his plan: · 2 hours ago
Correct me if I'm wrong, KP, but don't all the big 3 support these points? Doesn't seem to be much of a differentiator for Santorum.
Jan '11
Re: Santorum Lays Out Economic Agenda
Ed G.: Troy,
I agree with you about the balanced budget amendment. There's always a workaround, and if there isn't then we've tied the hands of Congress too tightly. The solution is to elect a virtuous Congress. Furthermore, I hate the idea of establishing a % of GDP as the government's cut. · 3 hours ago
I feel the exact same way when speaking of a gov't % of GDP. This is supposed to be a private/capitalist economy. The % the gov't receives should be what is needs for its limited role - I'm positive that alot less than 18%. That 24% that it currently is may be a useful metric, it (or 18%) shouldn't be acceptable as any kind of goal.