Romney’s “green” economic advisers

September 6, 2011

Later today Mitt Romney will unveil his 59-point economic plan. From what I read in Romney’s preview op-ed in USA Today, it looks a lot like his 2008 plan. For instance, it has an investment tax cut for the middle class just like the one offered three years ago. And Romney wants to cut corporate taxes. Last time he wanted to lower the rate to 20 percent. We’ll see this time around. One area where he could really separate himself is housing. Economic adviser Glenn Hubbard has a housing plan that would allow underwater homeowners to refinance at today’s superlow interest rates.  (In a recent chat, I talked to Hubbard about his views on economic policy: TARP, taxes, trade.)

And earlier today, Romney announced both Hubbard and Greg Mankiw of Harvard as his economic advisers. Interesting to see if his GOP opponents point out that Hubbard has supported cap-and-trade in the past, while Mankiw favors a carbon tax to limit greenhouse gases. As for their boss, here is what I recently wrote about his climate change position:

Romney is clearly in favor of limiting carbon emissions — at least in theory — but does not want to cripple the U.S. economy or spend trillions of dollars for “extreme and expensive measures” like cap-and-trade to do it. He mentions the work of Danish economist Bjorn Lomborg who believes “addressing the remediation of the effects of global warming [is] far more economic and far more humane than massive spending to reduce emissions.”

Romney also spends considerable time in his book explaining the pros and cons of a carbon tax-payroll tax swap, a plan favored by economist and Romney adviser Greg Mankiw and many other Republican-leaning economists. Among the positives, he says:  1) revenue neutrality; 2) higher energy prices would encourage energy efficiency; 3) industry would have a predictable outlook for energy costs; 4) profit incentives rather than government  subsidies would encourage the development of “oil substitutes and carbon-reducing technologies.”

 

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