Last Tuesday, the Club for Growth, one of the premier advocacy groups for fiscal conservatives, published its white paper on Gov. Mitt Romney. Previously they reviewed John McCain, Rudy Giuliani and the new top tier contender Mike Huckabee. HUMAN EVENTS looks at the two Governors — Romney and Huckabee — to see how they compare and whether they embody the rhetoric and policies of low tax, limited government and free market capitalism.
Club for Growth is not, of course the only conservative economic organization to examine the two Governors.
Romney previously received a “C” from CATO for his time as governor, getting credit for spending controls and battling the liberal legislature, but garnering this criticism about his no tax pledge: “That’s mostly a myth.” CATO cites his first budget which included “a $500 million increase in various fees” and his later proposal of, “ $140 in business tax hikes through the closing of ‘loopholes’ in the tax code.” He also drew fire for his healthcare plan with this comment: “If you consider the massive costs to taxpayers that his universal health care plan will inflict once he’s left office, Romney’s tenure is clearly not a triumph of small-government activism.”
Huckabee did even worse according to CATO, drawing an “F” for his final term and a “D” overall, explaining that he cut taxes early in his term but then after reelection “proposed a sales tax increase to cover a budget deficit caused partly by large spending increases that he proposed and approved, including an expansion in Medicare eligibility that Huckabee made a centerpiece of his 1997 agenda.”
The Club for Growth press release began with this: “”Governor Romney’s economic record contains a mixture of pro-growth accomplishments and some troublesome positions that beg to be explained,” said Club for Growth President Pat Toomey. Here are the highlights:
Taxes: “During his 2002 campaign for governor, Mitt Romney pledged to balance the budget without raising taxes and touted his fulfillment of that pledge throughout his term. While it is true that Governor Romney did not impose any broad-based tax hikes despite pressure from liberal special interests and an inherited budget deficit, he imposed a slew of fee hikes and tax “loophole” closures, together with spending cuts, in order to eliminate the budget gap.”
Romney gets credit for proposing a cut in the income tax rate and blocking a retroactive increase in the capital gains tax but is taken to task for failure to sign a local anti-tax pledge or endorse President Bush’s 2003 tax cuts.
Romney spokesman Kevin Madden replied: “Governor Romney inherited a $3 billion deficit when he took office and he wiped that deficit away without raising taxes. He fought against efforts to raise taxes and successfully hacked away at excessive government spending that had been going on for years prior to his term in office. The fees that were brought in-line with government services costs were user-based programs, and avoided levying a broad-based tax on all state residents.)
Romney does better on spending: “On balance, his record comes out more positive than negative, especially when one considers that average spending increased only 2.22% over his four years, well below the population plus inflation benchmark of nearly 3%.” He gets credit for opposing spending by the state legislature and streamlining agencies.”
Romney gets high marks on free trade, tort reform and regulation. His regulatory record is labeled “impressive” and his rhetoric shows support for free trade. On tort reform Romney is credited as a strong proponent of tort reform and gets praise for “insisting on badly needed nationwide tort reform” at the national level. He also gets kudos for support of education reform and school choice.
Political Speech: Club for Growth reviews Romney’s support for finance limits and proposing in 2002 “a radical new campaign finance system, in which privately-funded campaigns would be taxed 10%.” Club for Growth notes: “As a presidential candidate, Mitt Romney has pivoted drastically, abandoning his old anti-First Amendment stance and taking the harshest position on McCain-Feingold of all the candidates.” CFG hopes his new stance is “inspired by greater appreciation for the First Amendment rather than by the political dynamics of the presidential primary.”
Entitlement Reform: Romney gets credit for reforming welfare but chastised for not proposing a comprehensive social security reform plan. On “Romneycare”, Club for Growth acknowledges that regulatory impediments imposed by the federal government made his job tougher and the former governor gets credit for “a plan that encourages individually-owned health insurance and circumvents some of the inequities carved into the federal tax code.”
Nevertheless the conclusion is mixed: “To be sure, Commonwealth Care is a far cry from free-market healthcare. Besides the individual and employer mandates, the program expands Medicaid, does not deregulate enough, and will likely cost more than the current system, which despite all its flaws, does, after all, already provide universal healthcare on demand. Most of the blame for the deficiencies in the Massachusetts plan lies with the liberal Legislature which, absent the resistance of Governor Romney, almost certainly would have enacted a major tax increase while moving healthcare reform in the worst possible direction. Nevertheless, given its massively regulatory nature and likely high cost, the Massachusetts healthcare plan is not a model upon which a national plan should be built.”
Madden responded: “The governor’s health plan in Massachusetts was centered upon the conservative idea that each individual ought to be responsible for their own health care. It brought more people into the system so that the market forces could work to bring down costs.”
Conclusion: Club for Growth says his record is “generally good” but qualifies that “Governor Romney’s history is marked by statements at odds with his gubernatorial record and his campaign rhetoric.” However, on balance, the white paper concludes that “we are reasonably optimistic that, as President, Mitt Romney would generally advocate a pro-growth agenda.”
If Club for Growth is cautiously optimistic about Romney, it’s gloomy about Huckabee: “His history includes numerous tax hikes, ballooning government spending, and increased regulation. To be sure, Governor Huckabee’s record displays an occasional deference to a pro-growth philosophy, but that is only a small slice of a much bigger picture.”
TAXES: Club for Growth credits Huckabee early in his tenure with pushing for an $80M tax reduction package, a reduction in capital gains and a taxpayer bill of rights but says this was dwarfed by a slew of new taxes.
On balance, the review is harsh: “By the end of his ten-year tenure, Governor Huckabee was responsible for a 37% higher sales tax in Arkansas, 16% higher motor fuel taxes, and 103% higher cigarette taxes according to Americans for Tax Reform (01/07/07), garnering a lifetime grade of D from the free-market Cato Institute. While he is on record supporting making the Bush tax cuts permanent, he joined Democrats in criticizing the Republican Party for tilting its tax policies “toward the people at the top end of the economic scale” (Washington Examiner 09/13/06), even though objective evidence demonstrates that the Bush tax cuts have actually shifted the tax burden to higher income taxpayers.”
Huckabee has defended his tax increases contending some were approved overwhelmingly by voters and others resulted from a court order to improve education.
SPENDING: Again, Huckabee is chided. According to Club for Growth, Arkansas spending increased “a whopping 65.3% from 1996 to 2004, three times the rate of inflation.” This spending was due to, “The massive increase in government spending is due in part to the number of new programs and expansion of already existing programs initiated by Governor Huckabee, including ARKids First, a multimillion-dollar government program to provide health coverage for thousands of Arkansas’ children. (Huckabee has defended his spending on the basis that Arkansas needed significant improvements in roads, education and health care.)
FREE TRADE: Here Huckabee gets better marks for rhetoric calling for free trade and for signing a South Korea trade agreement.
ENTITLEMENT REFORM: Huckabee is praised for supporting President Bush’s social security plan for personal spending accounts but criticized for supporting the Medicare Part D (“a huge unfunded liability”).
REGULATION: Club for Growth takes Huckabee to task because he “consistently supported and initiated measures that increase government’s interference in markets, thereby impeding economic growth.” Examples include large increases in minimum wage and price gouging investigations.
SCHOOL CHOICE: His record is deemed “mixed” — due to support for home schooling and charter schools but opposition to a “genuine school choice-voucher programs.” He also supported No Child Left Behind, which Club for Growth notes, “stripped schools of local control and increased federal spending on education by 48% over three years.”
POLITICAL SPEECH: He is praised for opposing McCain Feingold although Club for Growth notes he approved restrictions on PACS.
TORT REFORM: He is credited with proposing and passing tort reform –specifically a limit of $1M on punitive damages.
CONCLUSION: Club for Growth calls him a “mixed bag” and concludes that “the overwhelming evidence of his record and rhetoric over the past ten years leaves the Club for Growth and economic conservatives around the country to wonder if a President Huckabee would espouse the relatively pro-growth policies of Governor Huckabee circa 1997 or the anti-growth policies of Governor Huckabee circa 2004.” Huckabee in turn has labeled Club for Growth “Club for Greed” and announced that he is opposing what he labels “Wall Street” Republicanism.
HOW DO THEY COMPARE? In the eyes of Club for Growth (as with CATO) Romney is regarded a flawed but favorable while Huckabee receives harsher treatment. As Huckabee climbs out of the also ran category he will have a chance to defend his record. Both Romney and Huckabee will face stiff competition from other opponents who will hone in on their less favorable aspects of these reviews.