"Economic Choices 2008"-Mitt Romney's Economic Advisor Glenn Hubbard
Monday, January 14, 2008SUSIE GHARIB: As we continue our "Economic Choices '08" coverage, we focus on tomorrow's Michigan Republican primary. The number one issue for voters is the economy and jobs. Michigan has the highest unemployment rate in the country and its economy is in recession. Mitt Romney, the Michigan- born former governor of Massachusetts, says he will fight quote for every single job in the state. Well, how would he do that? Earlier today I posed that question to Romney's senior economic advisor, Glenn Hubbard.
GLENN HUBBARD, SR. ECONOMIC ADVISOR, MITT ROMNEY CAMPAIGN: It's not that the president by himself creates jobs. It's what kinds of policies enable an economy to be a job-creating machine and what Governor Romney has emphasized in Michigan is the powerful role that research can play in new technologies and on trying to take the burden off the back of America's manufacturing sector -- tax reform, regulatory reform, all things that he has championed across the board in the country.
GHARIB: Glenn, many Middle American families feel very threatened by globalization and outsourcing. How would Governor Romney's free trade policies help a hard-hit state like Michigan?
HUBBARD: I think in two ways. One, free trade has really helped the United States in terms of both job creation and incomes. But it's done so unevenly. And Governor Romney realizes that. He will propose and has proposed ways to help people who have lost their jobs because of trade or any other aspect of competition and again, to promote the kind of research that would create new manufacturing technologies that our country can succeed with.
GHARIB: Governor Romney has said that priority number one to head off a recession is to quote, stop the housing crisis. How would he propose to do that?
HUBBARD: The way to quote stop the housing crisis is to really blunt its effects. And to do that, one would make sure that people who are in a home in which they're actually living but who could afford that home but for resets could simply be moving to a new mortgage. I think that requires strengthening the FHA. There are programs like Neighbor Works America that need additional Federal support and Governor Romney certainly supports that and finally, taking a hard look at tax policy and do we need a fiscal stimulus? And I think Governor Romney's open to that discussion.
GHARIB: There's a lot of momentum in Washington now for a fiscal stimulus plan and there are a lot of proposals that are being bandied about. Where does Romney stand on fiscal stimulus?
HUBBARD: Perhaps the most important thing Governor Romney has said and actually other Republican candidates have said, most of them -- is that we have to make the Bush tax cuts permanent. Failing to do that, the economic implications of anticipating very large tax increases would dwarf anything we're talking about in terms of stimulus. So that's job one and Governor Romney has been very clear.
Second would be to focus on the real problem. We are seeing a slowdown in business investment and I think Governor Romney believes and particularly important in Michigan that we could take tax action to help on that front. The third would be to take additional action that would strengthen the incomes of moderate-income Americans. I think all those are part of a stimulus package.
GHARIB: Mike Huckabee has said that Romney hasn't addressed the concerns of working American families, concerns like job security, high gasoline prices, low home prices. What is Romney proposing to do to improve the economic situation of middle income Americans?
HUBBARD: Governor Romney has focused on this. Indeed, in his campaign the specific parts of his tax package have focused on the needs of middle and lower-income Americans, not the most affluent. He's been very concerned to make the gains from international trade shared more broadly. And his emphasis on economic growth really benefits all Americans. I guess I would put the burden back on Governor Huckabee. As an economist, I've heard nothing coherent as a policy proposal from Governor Huckabee.
GHARIB: Glenn, everyone thought that Governor Romney would be the pro- business free market standard bearer in this presidential race, but he hasn't been really doing that well. What does this say, then, about where the Republican Party is headed?
HUBBARD: Well, first, he is actually the pro-business free market standard bearer. That's pretty clear and I think he has very broad support from the business community. He of course, isn't running for business person in chief; he's running for commander in chief. And I think his message is resonating with voters. The Republican Party, like the Democratic Party, has different interest groups within it. But I think Governor Romney will prevail with a very solid message focused on the economy and families and values.
GHARIB: Glenn, thank you so much for your time.
HUBBARD: My pleasure.
KANGAS: Tomorrow, from unemployment to housing, we get analysis on the biggest financial concerns of Michigan voters.
