Eight GOP Hopefuls Blast Obama on Troubled Economy
Policy + Politics

Eight GOP Hopefuls Blast Obama on Troubled Economy

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The eight announced Republican presidential candidates who debated Thursday night ahead of this weekend’s Iowa straw poll used similar themes to attack President Obama’s management of the economy and willingness to raise taxes on the nation’s well-to-do. However, , several managed to score points against their opponents as they jockeyed for position in what now appears to be a wide open race to take on an increasingly vulnerable incumbent.

By the end of the two-hour nationally televised  debate in Ames, Iowa, though, it was clear that Republican primary voters, who won’t cast their first votes until January, will face choices from this field that have more to do with style than substance when it comes to the major economic and fiscal challenges facing the nation. Each supports smaller government, fewer regulations, no new taxes and rapid movement to a balanced budget to restore economic growth.

The most telling moment of the debate came when the entire group was asked if they would oppose a deficit reduction plan that included ten dollars of budget cuts for every dollar in tax increases, should the 12-member “super committee” recently appointed by the House and Senate leadership come up with such a plan. All eight raised their hands.

Two of the ex-governors in the race – Tim Pawlenty of Minnesota and Mitt Romney of Massachusetts – took the hardest hits from their opponents. Rep. Michelle Bachmann of Minnesota deflected Pawlenty’s charge that she voted for a cigarette tax increase in their state when she was in the legislature by pointing out that it had been tied to a bill that preserved abortion restrictions in Minnesota. “I didn’t cut deals with special interests where you put the pro-life issue together with tax increases issues,” Bachmann fired back at Pawlenty.  “Life comes first.”

Romney once again found himself on the defensive over Massachusetts’ health care reform law and its individual mandate to buy insurance, which served as the model for the plan that President Obama signed into law last year. Romney said it should be up to states to decide and he would immediately grant every state a waiver to enact its own plan if elected. He later said he would sign legislation repealing the law.

After the debate, Republican pollster Frank Luntz said the weak showing by all the governors in the race, including Jon Huntsman  Jr. of Utah, who may have alienated many Tea Party voters by castigating those in Congress who said the U.S. should default rather than raise the debt ceiling, left the door wide open for Texas Gov. Rick Perry to enter the race. Luntz predicted Perry would be on stage when the candidates meet for the next debate in September.

Pawlenty probably had the most to lose in the debate because he is badly trailing Romney and Bachmann in the polls and had to overcome an image of being too bland and deferential to his top competitors. Several times he went after Bachmann directly, saying that she has a “paltry” record in Congress and has  repeatedly failed to deliver on threats to block or dismantle Obama administration measures – including the final deal to raise the debt ceiling that the president signed into law a week ago. “Leading and failing is not the objective,” he said. “Leading and getting results is the objective.”

The one candidate who was able to set himself apart  from the crowd on the issues was Texas Congressman Ron Paul. The libertarian gadfly said he wants to abolish the Federal Reserve Board and would cut the budget by immediately withdrawing U.S. troops from Afghanistan, Iraq and other overseas commitments, which drew a heated response from former  Pennsylvanian Rick Santorum, who sponsored Iran sanctions legislation when he served in the Senate.
Former House Speaker Newt Gingrich received one of the biggest cheers of the night after attacking Fox News anchor Chris Wallace for asking “gotcha” questions about the turnover in his campaign staff. After pointing out that Ronald Reagan had fired most of his staff before the New Hampshire primary, Gingrich said the media pays too much attention “to the minutiae of the campaign and not enough to the issues.”

In an effort to avoid that fate, here is The Fiscal Times roundup of where the eight candidates stand on the major issues:

Former Massachusetts Gov. Mitt Romney
“If you spend your life in the private sector, you understand how jobs come and how they go,” he replied when asked what he would do to help unemployed Americans. But when asked about his role at Bain Capital, where he shuttered some plants and laid off workers, he was forced to explain the role of venture capital in U.S. society. “We invested in 100 companies. Not all of them worked. I am very proud of the fact that I learned how we gain jobs, how we lose jobs. In those businesses, we actually gained tens of thousands of jobs.”

He offered the standard Republican solution for job creation: Lower corporate tax rates; less regulation; a pro-trade policy; an unspecified energy policy; rule of law; and “institutions that build human capital.” Yet he later said he would not extend unemployment insurance for the long-term unemployed. If elected, he said, he would immediately introduce legislation that would set up individual accounts for workers that they could draw down when they lost their jobs. 
His most immediate answer to the question of the deficit problem came in response to a question about jobs. To create more jobs, he said, you need “a government that doesn’t spend more money that it takes in.”
Romney later contrasted the size of government under President Kennedy, which predated the creation of Medicare and Medicaid, to where it is today – 37 percent of GDP or one-third larger than it was in the early 1960s. “We’re inches away from not having a free economy,” he said. “I would not raise the debt ceiling unless we had cut, cap and balance,” referring to a House GOP plan for imposing spending cuts and restraints and passing a balanced budget amendment.
When asked to explain why he raised taxes to help balance Massachusetts’ budget during his term in office, Romney denied the charge. “I don’t believe in raising taxes,” he said, “and as governor  I cut taxes 19 times and didn’t raise taxes.”
Yet a new report in Politico, based on a presentation Massachusetts made to Standard & Poor’s in 2004, shows that Massachusetts in the wake of the 2002 economic downturn raised taxes and fees by more than $1 billion through a tax amnesty, “tax loophole” legislation and increases in fees. Romney critics at the time charged the plan was “a stealth tax,” Politico reported.

Rep. Michele Bachmann, R-Minn.
Bachmann says that her economic policies – including her opposition to raising the debt ceiling and cutting spending  -- would begin to improve the economy  and begin to create jobs within the first three months of her taking office as President. “We can start  to see recovery within  three months,” she said. “Not the full recovery, but we can begin to see it if we put in place what we know to be true. Number one, we should not have increased the debt ceiling. In the  last few months I was leading on the issue of not raising the debt ceiling,  that turned out to be the right answer.”

Fiscal Policy and the Deficit:
She contended that the Standard & Poor’s downgrade of the U.S. government’s AAA credit rating was a vindication of her unsuccessful  effort to block Congress from raising the debt ceiling. “The worst thing that you can do is to continue to borrow money and spend money that we don’t have,” she said. “When they [S&P] dropped our credit rating, what they said was, ‘We don’t have an ability to repay our debt.’ That’s what was the final word was from then. I was proved right in my position. We should not have raised the debt ceiling, and instead we should have cut government spending, which was not done, and then we needed to get our spending priorities in order.”

Bachmann said she would oppose any tax increases as part of a deficit reduction deal, even if there were $10 of cuts for every $1 of tax increases. She defended her 2005 vote as a member of the Minnesota state legislature in favor of a budget ending a government shutdown  that included a 75-cents a pack  increase in a cigarette tax because, she claimed, the legislation also contained  a provision protecting right to life. “I believe in the sanctity of human life,” she said. “ I believe you can get money wrong but you can’t get life wrong, and that’s why I came down on that decision that I made.”  Tim Pawlenty, who was Minnesota governor at the time, said Bachmann was trying to distort her vote in favor of the cigarette tax hike,  which raised $400 million.

Former Minnesota Governor Tim Pawlenty
He defended what many describe as his overly ambitious 5 percent yearly economic growth plan and said the U.S. needs a growth target even if the bar is high.

Deficit/fiscal issues:
Pawlenty challenged viewers to find a specific plan from President Obama on Social Security or Medicare reform. "If you can find Barack Obama’s plan on any of those, I will come to your house and cook you dinner,” he said. “Or, if you prefer I’ll come to your house and mow your lawn."  That last line was aimed at the multi-millionaire Romney.

Pawlenty repeated his claim that he balanced the budget every year he was governor and left Minnesota with a budget surplus. When he left office, Minnesota faced a $6.2 billion deficit.

He said that in hindsight he regretted levying a cigarette tax in 2005 while he was governor, and said that when leaders are faced with big deficits they should not raise taxes. "My record of leadership in Minnesota, cutting spending from historic highs to historic lows, balancing the budget every time, doing health care reform the right way again stands in contrast to Barack Obama."

Former  Pennsylvania Sen. Rick Santorum
Jobs :

Santorum would focus on measures to  expand U.S.  manufacturing and prevent further job loss to overseas businesses.  “If you want to know where the middle of America went, it went to China, it went to Malaysia, it went to Indonesia.  We need to bring it back.” 

Fiscal Policy and the Deficit:
“We have spending that has exploded…the problem is in spending, not taxes.  We’ll get those taxes up if we grow the economy. “

He called for a balanced budget amendment to the Constitution, and said it should have been the focus of the debt ceiling negotiations from the beginning.  He sharply criticized Bachmann for arguing that the government could  get away without raising the debt ceiling when it borrows more than 40 percent of what it spends, adding that Bachmann was engaging in “showmanship, not leadership.”

He proposed cutting the corporate tax rate to zero for manufacturers. “You want to create opportunity for businesses to manufacture to grow, cut that tax to 0, our jobs will come back.”

Former Utah  Gov.  Jon Huntsman Jr.

Huntsman said  Obama has fundamentally failed on creating  jobs. He defended his record of  outsourcing jobs to China at Huntsman Corporation, a family owned chemical  manufacturer.

“If you want to build a facility in the United States, you can’t because of the EPA’s regulatory reign of terror,” he said. “We don’t make things anymore in this country.  We need to start making things in this country, and in order to do that we need serious regulatory reform.”

The Deficit and Fiscal Policy:
He called the nation’s growing debt “a cancer.,” and voiced disappointment that a plan by  House Speaker John Boehner, R-Ohio, for cutting spending and raising the debt ceiling wasn’t the one that  finally prevailed because of opposition from the Tea Party.

“I’m the only one on the stage who stood up for the   Boehner deal against this nation defaulting,” he said. “The thought that people would just let the nation default when we could have a deal that at least gets things going on cuts, raising the ceiling, gets us toward entitlement reform, gets us toward a balanced budget amendment.  I thought Speaker Boehner should be complimented.”

He called for tax reform that “allows our entrepreneurs and businesses to step up and expand our economic base and create jobs.”

Businessman Herman Cain
The Economy and Taxes
Cain, the former CEO of Godfather’s Pizza, said he would make the current Bush-era tax cuts permanent, as a first step towards restarting the economic engine. “You have the group that’s talking about spending, you have the group that’s talking about cutting, I represent growth and it starts with the business sector putting fuel in the engine,” he said.

His other proposals include lowering the corporate tax rate to 25 percent and abolishing the capital gains tax.  In looking for ways to pay down the U.S. debt, he would  look for cuts in the federal government “agency-by-agency.”
Former House Speaker Newt Gingrich  of Georgia
Jobs and Taxes:
Gingrich said he was the most qualified GOP candidate to create jobs and grow the economy because of his success cutting taxes in time of a divided government under former presidents Ronald Reagan and Bill Clinton. “This Saturday is the 30th anniversary of Ronald Reagan’s signing the Kemp-Roth tax cut, which was done with divided government. I was part of that effort in the House where Democrats were in control. He did it by going to the American people with clarity, creating a sense of urgency, bringing pressure to bare on the Democratic congressman and building a bipartisan majority. That tax cut led to seven years of growth, which in our current economy would be the equivalent of adding 25 million jobs, $4 trillion, $400 million dollars into the economy and $800 billion dollars in federal revenue. A decade later, as Speaker of the House, we had divided government. I negotiated with Bill Clinton. He vetoedwelfare reform twice, we passed it three times, he signed it the third time. “

Fiscal Policy and the Debt:
Gingrich called the creation of a new, bipartisan House-Senate committee to propose $1.5 trillion of savings to Congress before Thanksgiving as part of the debt ceiling deal “ as dumb of an idea as Washington has come up with in a while, and urged Obama and Congress to get rid of it and bring the negotiations back to congressional committees where they will be part of the public record.

Rep. Ron Paul of Texas
Paul remained committed to reforming the monetary system and reverting to a gold standard. He would abolish or gradually phase out the Federal Reserve Board in order to save long lasting prosperity and encourage economic growth. “The booms and bust come from a failed monetary system,” Paul said. “The interest rates are way lower than they should be and it encourages mal investment and debt.”

Deficit/fiscal issues:
Paul opposed raising the debt ceiling and said the federal government needs to liquidate its debt and restore sound money. "The country is bankrupt and no one wants to admit it," Paul said. "When you are bankrupt you can’t keep spending."

Paul supports a better tax structure and lower taxes as one way to get the economy growing again.

Eric Pianin, Adam Corey Ross, Michelle Hirsch and Jennifer DePaul of the Fiscal Times contributed to this report