Analysis of Mitt Romney Plan for Economic Growth (Part 2)

     In this blog, I will analyze the last two pillars of Governor Romney's plan for economic growth.  Again, I will link the website at the bottom of this entry, so that readers can view the original documents for themselves.  In my last post, I addressed the first two areas that Governor Romney puts forth in his plan.  Accordingly, I will view the purposed policies through a realist view of political science.

     Reform Entitlement Programs to Ensure their Viability

     Governor Romney's plan is one that attempts to "gradually reduce growth in Social Security and Medicare benefits for more affluent seniors" and "give more choice in Medicare to improve value in health care spending."  In order to analyze this properly, it is necessary to look at the federal law that these two entitlement programs are funded by, and what would be required in order to make these policy changes.  The Social Security Act of 1935 established the system that is currently in place, and makes spending mandatory in the budget.  Also, the Social Security Act of 1965 added Medicare as a mandatory spending expenditure for any budget.  With this knowledge, it is necessary to view that to gradually reduce growth in Social Security and Medicare, it will, quite literally, take an act of Congress.  I want to say that again.  The changes made to either of these programs must be changes in law.  Again, this policy is more idealistic than realistic.  As has been shown in our current political history, the ability of Congress to pass a law that creates changes are few and far between and typically are divided among ideological lines.  A more realist view would be to have a dialogue over whether or not, should the U.S. have systems in place to care for the elderly and the infirm.  If so, then the massive changes that are being stated by this policy may have a chance at occurring.  However, given the amount of political capital needed to push legislation of this magnitude through the Congress, it may not be viable.  One only needs to look at the passage of the Affordable Care Act to see that even with a majority, President Obama had to spend political capital with his own party in order to have any hope of the law passing.  As an idealistic policy, it does not address the truth of the matter.  In order for any change in either entitlement program to occur, it must come from the Congress.  While House Majority Leader John Boehner (R-8th District, Ohio) may have the ability to whip the votes in the House, it would meet with fierce opposition by the Senate Majority Leader, Harry Reid (D-Nevada).  Even if there is a party shift which gives the Republican party a majority of both houses of Congress, the political reality is that once a bill of this magnitude began, the political push back by those affected by it may make it untenable, and a non-starter even in a sub-committee.

     Make Growth and Cost-Benefit Analysis Important Features of Regulation
   
      In this final pillar of the plan put forth by Governor Romney, the desire to change the current state of legislation becomes the focus.  Specifically, to repeal and replace the Dodd-Frank Act and the Affordable Care Act.  The Dodd-Frank Act was drafted in reaction to the economic crisis of 2008.  It created oversight and regulation in order to prevent another crisis.  There are two provisions that are the cornerstones of the Act itself.  First, it ends the idea of "to big to fail bail-outs" and establishes consumer protections.  While this Act is a necessary check against rampant speculation by investors, the Act itself is flawed.  It is more realistic to repeal the Dodd-Frank Act, and reenact the Glass-Steagall Act, specifically Section 16, 20, 21, and 32.  These sections separate commercial and investment banking, and are commonly now referred to as the Volker rule.  However, I am unsure that a Romney administration would be willing to repeal the regulations and then also put limitations on banking.  As for repealing the Affordable Care Act, this would be more difficult.  Since the Supreme Court stated that the Affordable Care Act is constitutional, it would require that the law be replaced with an equally constitutional law, or a complete abandonment of the policy.  Realistically, it would be unrealistic to repeal the act, as the provisions of the act are being rolled out and many in the public are beginning to appreciate what was legislated.  As for the particular mandates, however, there is a wider ability to limit and/or remove them completely.

     In this analysis, there is a more realistic view brought to bear by Governor Romney.  However, it is necessary to temper that with the facts of the current political world.  If there is an opportunity to enact these policies, it may create a deficiency in political capital.  If Mitt Romney wins by a slim majority, and the Congress stays split, this will create a more difficult puzzle for him to navigate.  As with any candidate, the ability to convince the population of the viability of a particular policy is not as important as gaining popular support for the desired change.  The real work does indeed begin upon election, and not only attempting to enact policies, but ensuring that those of your party in Congress are willing to do so as well.