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Paul KRUGMAN
pkrugman@stargazete.com
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Mitt Romney’s Arithmetic Does Not Add Up

15 Eylül 2012 Cumartesi

Another day, another whopper Mitt Romney. Now the Republican presidential candidate says that he’ll keep the good parts of Obamacare, in particular coverage for people with pre-existing conditions, while scrapping the rest.

You can’t do that — and Mr. Romney knows very well that you can’t do that because the logic that went into Romneycare in Massachusetts when he was governor is the same as the logic behind Obamacare.

Suppose you want to guarantee that insurance is available to people with pre-existing conditions. Well, you can establish “community rating,” requiring that insurance companies make the same policies available to everyone. But if you stop there, you know what will happen: Healthy people will opt out, leaving behind a high-risk, high-cost pool.

So you have to also have a mandate requiring that people buy insurance. And you can’t do that without subsidies, so that lower-income people can afford their policies.

The inexorable logic of the situation, then, leads to a three-legged stool of community rating + mandate + subsidies = ObamaRomneycare.

So, does Mr. Romney think we’re stupid? Hey, he also thinks we’ll buy into his promises to slash taxes by $5 trillion but make up the revenue by closing unspecified loopholes in a way that doesn’t raise taxes on the middle class — which turns out to be arithmetically impossible.

So the answer is, yes, he thinks we’re stupid.

No Details Forthcoming

Hmm. Even on the right, people are complaining that Mr. Romney isn’t providing enough details about his plans. And I’ve spoken to journalists who are sure that Mr. Romney will be forced to say more before Election Day.

No, he won’t.

He might lose for lack of detail, but no detail will be provided, for a very simple reason: His proposals don’t add up. He literally can’t do what he says he would do, namely cut tax rates on the rich without raising the tax burden on the middle class or making the deficit surge; nor can he propose spending cuts as large as he claims without cutting deeply into programs people depend on.

Another way of saying this, of course, is that his alleged budget plan is actually a fraud.

Why would he do such a thing, and expose himself to the criticism he now faces? Well, why should he have expected this scrutiny? Paul Ryan, the Republicans’ vice-presidential contender, has been running around for years with a supposed fiscal plan constructed largely out of magic asterisks and got hailed as a Bold Truthteller.

Mr. Romney must be asking why the rules have changed. Apparently, though, they have. And because Mr. Romney went with the assumption that he would never be asked to explain his proposals, he is now in a position where he can’t.

BATTLE OVER HEALTH CARE

In an interview on NBC’s “Meet the Press” on Sept. 9, the Republican presidential candidate Mitt Romney said that if elected, he would keep some popular features of President Obama’s Affordable Care Act — though he has said he would work to repeal the law at the Republican National Convention in August and in other speeches.

“I’m not getting rid of all of health care reform,” Mr. Romney said in the interview. “Of course, there are a number of things that I like in health care reform that I’m going to put in place.”

Among the provisions that Mr. Romney said he would keep were the guarantee of coverage for people with pre-existing medical conditions and the one allowing people in their 20s to remain on their parents’ insurance plans.

Aides later clarified that Mr. Romney’s policies would only protect patients with pre-existing conditions having their insurance coverage canceled.

Some reporters and commentators have characterized Mr. Romney’s remarks as a step toward his becoming a more moderate candidate — with his party’s convention concluded, he is now vying for swing votes.

Jim Kuhnhenn, a reporter for The Associated Press, wrote in a recent article that Mr. Romney’s comments have “brought renewed attention to the similarities between Obama’s plan and the one Romney championed when he was Massachusetts governor, which included protections for health conditions and an individual mandate that the Republican has since railed against.”

The candidates have also criticized each other over the handling of Medicare, the government-run health insurance program for senior citizens. Mr. Obama supports appointing advisory panels to review Medicare’s costs, while Mr. Romney proposes that participants in the program receive subsidies that they could use to buy insurance private or government agencies.

The Choice Is Clear in This Election

A while back I mentioned, in a quite different context, an essay by Isaac Asimov on Soviet science fiction, in which he argued that the two main themes of Western sci-fi — “what if” and “if only” — were ruled out. Instead, writers wrote on the theme “if only this goes on.”

And that was the theme of President Obama’s speech earlier this month at the Democratic National Convention. And you know what? That was perfectly fine.

Mr. Obama couldn’t talk about how wonderful things are, because they aren’t. Nor could he run against his own record. So he had to make the case that things will get much better if he gets a second term, while getting much worse if he doesn’t.

And there’s a lot to that case. If Mr. Obama is re-elected, we’ll have near-universal health coverage by 2014. That’s a very big thing. Financial reform is also important — and has already been enacted. And there’s a good chance that he’ll get to preside over an economic recovery that will validate his record, too.

There’s been a chorus of disapproval pundits who wanted ... what? It wasn’t appropriate for him to replay Bill Clinton’s convention wonkfest. He wasn’t going to unveil major new proposals.

He made the case he needed to make, and did it well.

Not the Time to Be Demanding

I’ve been pounding the drum for Keynesian policies ever since the financial crisis struck. I was one of the few people to talk negatively about President Obama’s inaugural address in 2009 because it seemed to miss the point that we were suffering inadequate demand in the United States, and I was frantic about the inadequate size of the stimulus.

So, am I upset over the virtual absence of demand-side rhetoric in Mr. Obama’s speech at the convention? Let’s be realistic: the public doesn’t get Keynesian economics. The president could use the bully pulpit to try and change that, and I’ve been urging him to do that. But not two months before an election.

And we know that the administration has demand-boosting on its mind. The American Jobs Act, proposed a year ago and blocked by Republicans in Congress, was very much a Keynesian-type plan, and everything I know says that it’s a good example of the kind of thing the inner circle supports. It’s reasonably certain that there will be attempts to provide more demand if Mr. Obama wins, and that’s all you can ask for at the moment.

It’s too bad we’re at this place, but we are, and it would be unrealistic and counterproductive to demand that Mr. Obama try to shift the national discussion that far right now.

Obvious Flimflam

Tom Edsall, a journalism professor at Columbia University, wrote a very good online article recently for The New York Times on one of the key evasions in Paul Ryan’s budget plan: the huge unspecified cuts in discretionary spending.

“What people have not been talking about enough,” Mr. Edsall wrote, “is that the Ryan budget contains an $897 billion sinkhole: massive but unexplained cuts in such discretionary domestic programs as education, food and drug inspection, workplace safety, environmental protection and law enforcement. The scope of the cuts — stunning in their breadth — is hidden.”

Mr. Edsall goes into more detail than anyone else I’ve read about just how much is hidden in that “sinkhole” and how it calls everything else Mr. Ryan claims into question.

But can I point out that this basic piece of flimflam was obvious all along? From my original takedown, written in a column more than two years ago: “Finally, let’s talk about those spending cuts. In its first decade, most of the alleged savings in the Ryan plan come assuming zero dollar growth in domestic discretionary spending, which includes everything energy policy to education to the court system. This would amount to a 25 percent cut once you adjust for inflation and population growth. How would such a severe cut be achieved? What specific programs would be slashed? Mr. Ryan doesn’t say.”

And yet until very recently the whole Beltway was united in praising Mr. Ryan as a Serious deficit hawk, with a detailed plan — he even received a big award for fiscal responsibility.

So the Ryan story isn’t just about Mr. Ryan; it’s about how the establishment allowed itself to be taken in by such an obvious shyster, despite warnings many of us that he was, well, an obvious shyster.