Mitt Romney Economics

It may seem amazing that the US Presidential Election could be a very close contest. It is between a President with more grasp of what is now being called "big data" on the economy versus an ex-governor who is personally rich despite a slew of business failures and debt increases in New Hampshire and a business record of vulture fund capitalism - buying companies, loading them with debt and selling out profitably before the firms went bust. Rommney's economic ideas are ideological and theoretical and not empirical. They are not based on macro-economic modelling of the US economy and its international context. Of the six distinguished Nobel prize winners in economics who support Romney only one (Edward C. Prescott) has an established understanding of national income accounting but this is over-ridden by his belief in smaller government and lower taxes and that growth is 70% dictated long term by technology change and productivety gains. Such views discount the short and medium term reality of economic and credit cycles and the need for government to lead an economy out of recession. We have no past experience or current evidence of the private sector by itself being willing and able to pull the economy out of recession or low growth. For that to happen the banks would have to change their fundamental strategy for doing business. Until then the job remains principally the government's financial responsibility and for that it must retain flexibility and sufficient financial firepower. Many talking heads and voters believe that US Federal Goivernment is financially bankrupt and has run out of effective ideas and tools. This is so far from the truth that such ideas are economic suicide. A third of the Federal debt belongs to government itself and could be cancelled. Budget deficits are no larger than they should be. The problem for government is how to include the banks in its efforts to boost economic growth. The Romney camp do not understand the economic role of government as a counter to wealth and income concentration serviced by banks that if unchecked would seize up circulation of money in the economy. Government's role is to recycle from wealthy and rich areas and people to porrer ones in order that the economic system continues to trade widely across the nation and provide growth opportunities and economic survival throughout. The presidential election is a battle between empirical realism based on understanding the acounting of the national economy and a contrary view that is philosophical and ideologically-formed, between a practical short and medium term view and an idealised long term view. This is not just left versus right, but between those who account for all the numbers and those who want to focus on some ideas only and assume all else will somehow stay the same?