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Monday
Sep122011

Romney Promises 11.5 Million Jobs: Could He Really Deliver?

TIM SLOAN/AFP/Getty Images(WASHINGTON) -- President Obama Thursday night urged Congress to pass a plan that some analysts say will put 1.9 million Americans to work in the next year.  But two days earlier, GOP presidential candidate Mitt Romney announced a plan that he says will create nearly 10 times as many jobs.

Romney, who detailed his jobs agenda in a 161-page book, said in a Las Vegas speech unveiling the plan that if elected, he would push his plan to create 11.5 million jobs in his first term, dropping unemployment to less than 6 percent and boosting gross domestic product (GDP) growth to 4 percent annually.

But while most economists agree that Romney’s plan does include some job-creating initiatives, whether his proposals will add up to 11.5 million jobs is a bit hazy.

“It is unclear what that 11.5 million number came from,” said John Irons, research and policy director for the Economic Policy Institute, a nonprofit think tank.

Irons said 11.5 million jobs, or about 240,000 per month, is a “fairly modest target” because most economists would expect about 300,000 to 350,000 jobs to be created per month when the economy is coming out of a recession.

“If that’s his target, I don’t think it’s ambitious enough,” Irons said.  “It is a little bit notable, but that’s not that many over four years.  That’s the kind of job creation you would expect to see as a status quo.”

Romney’s proposed GDP growth is about half a percent higher than the 3.6 percent growth that the non-partisan Congressional Budget Office projects under current law for the same four-year time frame.

But on unemployment, Romney suggests his plan will outpace current CBO predictions by 2 percent.

“It’s a practical plan to get America back to work.  It’s also immediate,” Romney said of his plan.  “This isn’t something that’s going to take years to put into place.”

The former GOP front-runner’s plan includes five executive orders he would sign on his first day in office and five bills he would immediately send to Congress.

One bill would lower the corporate tax rate from 35 percent -- the second highest rate in the world -- to 25 percent.  William McBride, an economist at the Tax Foundation, said the lower rate would reduce unemployment by about 0.5 percent, adding about 1 million jobs in a year.

But while dropping the rate by 10 percent would stop U.S. businesses from relocating overseas, it would not lead to a large number of companies relocating to U.S. soil because the average rate of America’s trade partners is around 25 percent as well, he said.

“This ultimately isn’t so radical.  It’s just moving us toward the average,” McBride said.

Copyright 2011 ABC News Radio

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