Long Live Laffer?

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August 3, 2012 10:56 am
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There’s a flipside to the point Josh makes below.

After flirting briefly with the outrageous notion that he could bring unemployment down to four percent, Romney’s taken to claiming that under his leadership unemployment will fall to about six percent in his first term, give or take a few tenths of a percent.

That’s fairly consistent with the “Romney boom” his advisers are promising. But here’s the thing: it’s also basically what most economic models say predict will happen no matter what, given safe assumptions.The business cycle will eventually work its magic.

This is a clever trick — and cynical, too. From the darkness of 8.3 percent unemployment, six percent sounds like a bright, sunny afternoon in America. What Romney and his advisers are doing is positioning him to claim credit for the rising of the sun.

You might say that’s just politics. And of course that’s true. But this isn’t simply a matter of drafting Romney’s legacy in advance of his potential presidency. It’s about linking everything Romney plans to do as president — cut taxes for the rich, roll back the social safety net — with a future of economic growth we know will come eventually anyhow.

So let’s say it happens. Let’s say Romney comes into office around the time growth shifts into higher gear. He cuts taxes a bunch. He begins the process of privatizing Medicare. He repeals Obamacare. Four years later, with unemployment down at six percent, he, naturally, credits his policies with ushering in the recovery.

Economists could cry foul all they wanted, but no number of Paul Krugman columns are going to weaken the gut-level intuitiveness of Romney’s claim. It’s the supply side movement’s greatest hope for a lasting revival.

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