"Study: Obama’s plan would create more 1.1 million jobs in 2013. Romney’s plan would create 87,000."

[applegrove]

Study: Obama’s plan would create more 1.1 million jobs in 2013. Romney’s plan would create 87,000.

Posted by Suzy Khimm at WP

http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/09/27/study-obamas-plan-would-create-more-jobs-than-romneys/

"SNIP.................................................

How did EPI come to its conclusions? By using multipliers of the GDP impact of spending and tax policies based on those published by Mark Zandi, chief economist for Moody’s Analytics.

“Large cuts in government spending will exert a strong drag on economic activity while large output gaps persist,” EPI explains. At the same time, “tax cuts, particularly tax cuts for businesses and higher-income households, are highly inefficient at spurring growth.” By Zandi’s calculations, general government spending has a multiplier effect of 1.4 for every $1 spent, while a payroll tax cut for employers has just a 1.04 multiplier effect.

According to EPI, the growth in jobs under Obama’s plan would primarily come from the American Jobs Act, which includes $142 billion in temporary spending, as well as some tax cuts. By contrast, EPI calculates that Romney’s major spending cuts — totaling an estimated $250 billion in net cuts in 2013 and 2014 — would be a drag on growth in the near term. The drag would be bigger if Romney makes his tax reform revenue-neutral, as he’s promised.

“Zandinomics,” however, have come under criticism by those who believe that Zandi is overstating the multiplier effect of government spending. Robert Barro and Charles Redlick, for example, found that the average multiplier for defense spending was only about 0.6 to 0.7 when the unemployment rate was an average of 5.6 percent, and that the estimated multiplier effect rose only to 1.0 when the employment rate was extremely high, at 12 percent.


................................................SNIP"

[Voice for Peace]

1. ha ha we win

[valerief]

2. Yes, but Rmoney's plan factors in deductions and exemptions.

[thesquanderer]

3. Wait... Romney has a plan? (n/t)

[appleannie1]

4. I did not know Romney had a plan. Is it something new?