Here is what James Pethokoukis of the American Enterprise Institute suggests Mitt Romney should say in response to the Fed's launching of QE3: "Like JFK and Ronald Reagan, we should cut tax rates on business and entrepreneurs and small business and the middle class." It's an old conservative refrain, and it's worked like a charm—as politics, though not as policy—for three decades.
Here's what the Romney campaign actually said: "We should be creating wealth, not printing dollars. As president, Mitt Romney will enact bold, pro-growth policies that lead to robust job creation, higher take-home pay, and a true economic recovery."
A political sophisticate would know that these two statements say essentially the same thing. "Higher take-home pay" is code for "lower taxes." But at this point Romney's presidential bid isn't about reaching political sophisticates. It's about reaching knuckle-dragging hard-core conservatives and tuned-out political independents. For both groups, it's better to spell things out, as Pethokoukos suggests. Why didn't Romney spell out that he wants to lower taxes? This is, after all, a guy who doesn't mind shooting his mouth off about imaginary craven White House apologetics before he knows the facts about the Libya killings, then doubles down, appalling even many of his fellow conservatives. Why be reckless there and cautious here?
This is the second recent instance I've noticed in which Romney has passed up an opportunity to articulate what has been, for a generation, the Republican party's central (some would say only) idea: Let's cut us some taxes! The first time was during the Republican convention, where Paul Ryan spoke of "tax fairness" rather than "tax cuts," and Romney said "tax" only in the context of Obama raising taxes or of his own plan to lower corporate tax rates, which is far less controversial than his pledge to lower all marginal rates on personal income by 20 percent; to lower taxes on investments; and to eliminate the inheritance tax. Larry Kudlow, the economist, TV personality, and keeper of the supply-side flame, noticed the convention omission, too. "I do not understand why he did not talk about his 20 percent across-the-board personal tax cut plan," Kudlow wrote on his Web site. "I don’t think he convinced the independent voters and I don’t think he’s going in the right direction in tax policy."
It's a new idea to me that a Republican candidate for president—especially one seemingly desperate to whip up his base—would ever hesitate to say he wants to cut voters' taxes. Why is Romney faltering?
One possibility is that Romney has concluded that every time he talks explicitly about cutting taxes he'll inadvertently raise the issues of how much he himself pays in taxes, and of his refusal to release tax returns for multiple years. Hell, I don't pay hardly any taxes. Why should you?
Another possibility is that every time he talks explicitly about his tax-cut plan he invites the Obama campaign to point out, yet again, that Romney won't say which tax deductions he'd eliminate to pay for it, and that his tax cut is so big that there's a good likelihood he'll have to eliminate some very popular ones, like the mortgage interest deduction. I've got a big tax cut plan you're gonna like, but I can only tell you about half of it.
The most tantalizing possibility of all, however, is that tax cutting, as an organizing principle for governance, no longer holds much allure for the voting public, which is surely aware by now of two things:
a.) the multiple tax cuts for the rich under Ronald Reagan and George W. Bush did not boost prosperity for the middle class, particularly during the past dozen years, when median income actually declined even as productivity increased;
b.) the main effect of tax cuts has been to increase the federal deficit. Even if you believe—as I do not—that government needs to be smaller, it's been pretty well demonstrated that the "starve the beast" Republican strategy of cutting taxes to force budget cuts doesn't work. It only increases the deficit. Indeed, the late libertarian economist William Niskanen argued persuasively that "starve the beast" actually increased government spending by discounting its cost, at least in the near term, which is the only thing voters usually pay attention to.
The evidence that the eternal Republican promise to cut taxes has lost its magic does not lie only in what Romney doesn't say. It also lies in what Obama does say. Starting with his (otherwise pretty weak) convention speech, Obama has been openly and repeatedly mocking the Republican tax-cut obsession. "You need to make a restaurant reservation, you don’t need a new iPhone," Obama said yesterday. "There’s a tax cut for that." Remember when Walter Mondale tried to score points at the 1984 convention by mocking Ronald Reagan's fiscal irresponsibility? ("Mr. Reagan will raise taxes, and so will I. He won't tell you. I just did.") Brave maneuver. Didn't work. This time, it looks like it will.