We're All Keynesians, Even Mitt Romney!

Check out this interview of Mitt Romney by Mark Halperin of Time.

Halperin asks: You have a plan, as you said, over a number of years, to reduce spending dramatically. Why not in the first year, if you’re elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you’d like to see after four years in office? Why not do it more quickly?

Romney replies: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I’m not going to do that, of course.

How very sensible! How very Keynesian! But, here's the thing, Gov. Romney: If you agree that spending cuts will throw an economy into recession, would you not also agree that spending increases will pull an economy out of recession? You do? Then why do you not loudly oppose congressional Republicans who have stymied each and every Obama stimulus proposal? And why do you believe what you say you believe about the macroeconomic effect of government spending if you believe -- as you have been saying -- that Obama's stimulus was a failure?

It is becoming increasingly difficult to believe anything Romney says. When he's talking to Tea Party lunatics, he's all Mr. Austerity, and when there is a need to sound halfway sane -- as when talking to a Time magazine reporter -- he morphs into a lucid Keynesian! During the interview Romney repeatedly brags about his 25 years in business. It is now becoming clear that the only thing he learned from his years in business is how to make a sales pitch: let's just tell them what they want to hear!

And no matter how Keynesian Mitt Romney sounds in the Time interview, don't expect any let up in GOP propaganda that Obama's stimulus, tiny as it was relative to the size of the American economy, was a bust. Here's E. J. Dionne in his recent Washington Post column:

Yet the drumbeat of propaganda against government has made it impossible for the plain truth about the stimulus to break through. It was thus salutary that Douglas Elmendorf, the widely respected director of the Congressional Budget Office, told a congressional hearing last week that 80 percent of economic experts surveyed by the University of Chicago’s Booth School of Business agreed that the stimulus got the unemployment rate lower at the end of 2010 than it would have been otherwise. Only 4 percent disagreed. The stimulus, CBO concluded, added as many as 3.3 million jobs during the second quarter of 2010, and it may have kept us from lapsing back into recession.

So when conservatives say, as they regularly do, that “government doesn’t create jobs,” the riposte should be quick and emphatic: “Yes it has, and yes, it does!”

Indeed, our unemployment rate is higher today than it should be because conservatives blocked additional federal spending to prevent layoffs by state and local governments — and because progressives, including Obama, took too long to propose more federal help.