The following was originally published by Politico
‘This is a defining time for America,” says Mitt Romney. President Barack Obama, he argues, wants to turn America into a “European-like entitlement society” in which “government provides every citizens with the same or similar rewards.” In contrast, Romney supports “an opportunity society, free people living under a limited government.”
After Newt Gingrich’s stunning victory Saturday in South Carolina, the former House speaker will likely dominate the headlines this week. But Romney, with his strong campaign team, deep pockets and overwhelming support from the Republican establishment, is still the odds-on favorite to win the GOP presidential nomination. So greater attention should be paid to the substance of his views, which — despite a book, a jobs plan, 17 debates and innumerable stump speeches — have received remarkably little attention.
Liberals have tended to focus on the dishonesty of his attacks on Obama, illustrated by Paul Krugman’s conclusion that he could not “find a true assertion anywhere” in Romney’s stump speech.
Conservatives, meanwhile, have fixated on his flip-flops, exemplified by John Huntsman dubbing him a “perfectly lubricated weather vane,” and on what Texas Gov. Rick Perry called his “vulture capitalist” record as head of Bain Capital.
Political analysts and the media have largely ignored probing Romney’s views — presumably waiting for his expected “pivot” to the center after he captures the nomination
But Romney’s campaign features his “entitlement-opportunity” contrast. This, the campaign staff argues, will frame his campaign against Obama.
Romney’s entitlement-opportunity divide is a variant of a tired conservative trope, a high-brow version of Gingrich’s “food stamp president vs. jobs president” riff. (It is revealing that George W. Bush’s version featured the “ownership society.” With the housing collapse, Republicans have retreated from offering “ownership” to offering “opportunity.”)
In any case, Romney promises to save us from the corrosive succor of European social democracy and to reassert the hardy rigors of American free-market fundamentalism.
Romney, the entitled scion of a Detroit auto magnate, is an unlikely messenger to carry this argument against Obama, a personification of opportunity in America. Moreover, the agenda that he uses this theme to justify is hardly popular.
U.S. inequality has not been this extreme since the 1920s, yet Romney offers tax cuts even more skewed toward the top than Bush’s — eliminating the estate tax, cutting corporate taxes, adding a whopping $2 trillion over 10 years above the Bush tax cuts, which he would sustain.
With U.S. military spending higher than during the Cold War, Romney talks about adding to, not subtracting from, its budgets. To pay for this and fulfill his pledge to bring the budget into balance — while reducing spending from nearly 25 percent of gross domestic product to 20 percent — would require cutting a staggering $500 billion in 2016 from all domestic spending (about 14 percent) on top of cuts already enacted. To achieve this, domestic programs would need to be cut savagely: ending Medicare as we know it, cutting Medicaid and turning it into a block grant to states and laying waste to everything from Pell college grants to the FBI.
These perverse priorities reflect Romney’s obliviousness to the actual challenges around entitlements and opportunity that the country faces.
What is the entitlement now most destructive of the U.S. economy? Surely, it is the richest Americans’ assumption that they are entitled to capture and pocket all the rewards of growth — as they have over the past decade.
We witness this as corporate profits, productivity and CEO pay rise, but workers do not share in the rewards. The perversity is exemplified by the captive corporate “compensation committees” that offer executives bloated compensation packages, giving them literally multimillion-dollar incentives to cook the books, merge and purge their companies or ship jobs overseas. Or by the golden parachutes that give failed executives multimillion-dollar packages as they’re handed their walking papers. Or the epidemic of bookkeeping revisions when the post-Enron reforms from Sarbanes-Oxley required CEOs to personally vouch for the accuracy of corporate reports. Or the pervasive practice of backdating stock options to ensure optimal value.
Romney, of course, personifies that sense of entitlement. What Perry called Bain Capital’s vulture capitalism exacted high fees and exorbitant returns that burdened companies with debt, even as it “shed” employees, extracted wealth and often left behind hollow shells headed toward bankruptcy. Bain didn’t “create wealth” so much as appropriate it, dismissing complaints as — in Romney’s words — the “bitter envy of success.”
And, as Romney revealed last week, the financial elite pay a far lower tax rate on income than the teachers of their children or other middle-class taxpayers. They also hire legions of lobbyists to defend this tax disorder. Consider that billionaire hedge fund director Stephen Schwarzman described the administration’s effort to have the wealthy pay regular income tax rates as a “war, like when Hitler invaded Poland in 1939.”
Today, America’s inequality is so distended that, as White House Council of Economic Advisers Chairman Alan Krueger detailed in a recent speech, it is “causing an unhealthy division in opportunities. And is a threat to our economic growth.”
The biggest threat to opportunity today isn’t an excessive “social welfare state” but inadequate public investment in areas vital to providing opportunity to all. Washington fails miserably at giving every child a fair start, starving investments in prenatal health care, early childhood nutrition, pre-kindergarten education, health care, affordable housing and hands-on instruction in the early years.
Conservatives rail against teachers’ unions and seek to use private schools and charters to break the “socialistic” public school system. But the reality is that the charter schools that perform better than public schools almost universally do so because they invest far more in the children they teach.
We even starve areas of crucial public investment — such as our decrepit infrastructure, everything from roads to transit to smart energy. This ultimately costs those who would be entrepreneurs far more than our threadbare safety net.
That is the final irony of Romney’s contrast of robust American opportunity with encrusted European entitlement. The sad reality is that after 30 years of conservative political control, the U.S. lags Europe and Canada in economic mobility.
As Kreuger points out, with inequality growing ever more extreme, this is likely to be reinforced in the coming generations. Increasingly in America, as in the class-based societies of Bourbon France or Prussian Germany, the luck of your birth determines your class.
Romney gets one thing right: Given the Republicans’ market fundamentalism, this election is a fight over the soul of America. Will our democracy be able to counter the power of the rich to rig the rules and reinforce their own entitlement and so open greater opportunity for most Americans? Or will money talk and the entitlement of the rich continue to undermine the opportunity of the many?
If nothing else, this is a fight worth having.