Joseph Stiglitz: "Romney's Plan Is Based on Magic"
Joseph Stiglitz: "Romney's Plan Is Based on Magic"
By Andrew Leonard, Common Dreams
02 November 12
Nobel-winning economist Joseph Stiglitz - an Obama critic - says Romney's cuts would be disastrous
oseph Stiglitz has a decent résumé. He won the Nobel Prize in economics and served as chairman of Bill Clinton's Council of Economic Advisers before being named chief economist of the World Bank. His C.V. , however, pales before his passionate commitment to pushing for economic policies that help the poor and powerless - inside and out of the United States. For Stiglitz, economics and social justice can't be separated.
Since the election of Barack Obama, Stiglitz has also been something of a thorn in the side of the current administration, consistently critiquing the White House for falling short. He wasted no time in pointing out that Obama's stimulus was too weak and his housing policy woefully ineffective - and he's been particularly biting on the topic of Obama's subservience to banking interests. But with Election Day fast approaching, it's always useful to look at what the other guys would do, instead. Stiglitz took some time out to explain to Salon why, when the topic is economy, there's really no choice for progressives in this election.
What's at stake in this election for the U.S. economy?
Quite a lot. First, there's what we call the macro-economy. The budget cuts that Romney/Ryan propose will certainly slow growth. If the European downturn continues that could tip us into a recession. The cuts certainly won't provide the kind of stimulus that Obama's jobs bill, for instance, pushes. Romney's plan is based on magic: Just because he gets elected, the economy is supposed to take off. There is no evidence that anything like that would happen. Quite the contrary - I think the opposite would happen. The business community would see the cutbacks coming and that would itself cause a slowdown in the economy.
So that's the macroeconomy. Secondly, the Romney/Ryan budget promises to spend more on the military while cutting taxes and cutting the deficit, and that means only one thing. If you look at the arithmetic, it means less investment in infrastructure, R&D, education … it just can't add up any other way. And that means we'll be growing more slowly in the future.
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