Republicans take president to task over debt
Updated: 2012-09-04 07:42
By Zhang Yuwei in Tampa, Florida (China Daily)
His nomination now official, Republican presidential challenger Mitt Romney hopes he can turn Americans' frustration with the US economy and fiscal problems into a victory over President Barack Obama in November.
For months, the 2012 race for the White House has been a dead heat, with most polls of likely voters showing only a few percentage points' difference between the two candidates. While Obama consistently outpolls his opponent on "likability", poll respondents say Romney, a longtime business executive and former Massachusetts governor, would do a better job handling the economy (52 percent to 43 percent in the latest USA Today/Gallup poll).
Romney, a founder and former CEO of private equity firm Bain Capital, has a better grasp of the urgency of the nation's fiscal challenges given his history of confronting "big problems" in business, said Carlos Gutierrez, vice-chairman of the institutional clients group at Citigroup Inc and former commerce secretary under then-president George W Bush.
"The reason why everyone keeps talking about the fact that he has business experience is because in business, we don't have the luxury of saying, 'Deficit, I'll get to that later, or after I'm re-elected'," Gutierrez said during a panel discussion about the US debt. Thursday's debate was organized by Bloomberg News and the Peter G Peterson Foundation on the sidelines of the Republican National Convention in Tampa, Florida.
To make sure convention attendees and those watching on television are reminded of Republicans' priority this election year, two "debt clocks" were installed inside the Tampa Bay Times Forum to show the US debt and the amount accrued since the party's four-day convention started.
Convention speakers have blasted Obama for the $5 trillion that has been added to the US debt since he took office in January 2009. Most, however, don't mention the fiscal impact of tax cuts and two wars initiated by Obama's predecessor, Bush.
In his convention speech on Wednesday night, vice-presidential nominee Paul Ryan promised: "In a clean break from the Obama years, and frankly from the years before this president, we will keep federal spending at 20 percent of GDP or less."
Gutierrez on Thursday praised Ryan's pledge and said reform of the US tax system is needed.
"It's important for people to just get the sense of the numbers in the context. The federal government today is 24 percent of our GDP. Three years ago, it was 20 percent," he said. "Do we really want to pay taxes for the kinds of things we are doing to get to the 24 percent, including a failed stimulus package?"
"This is a crisis moment," the former Bush Cabinet official said, adding that most Americans aren't aware of the severity of the country's fiscal trouble.
Steve Bearcino, a convention delegate from New Mexico, said he hopes the Romney-Ryan ticket will change the country's economic fortunes.
"A family can't spend more than it brings in; a company can't, and a nation can't," he said. "We must get our deficit and our debt under control. Our debt is bigger than our economy now, and that's going to simply undermine the economy of the world, and China's economy is going to be worse off because of our economy."
As holder of about $1.2 trillion in US Treasury bonds, China is the United States' biggest foreign creditor.
At the convention, US Senator Rob Portman of Ohio, who served as US trade representative under Bush, criticized Obama for leaving the nation "beholden" to China over its purchase of US debt.
Obama and the divided Congress - Republicans control the House of Representatives, while Democrats have a slim majority in the Senate - reached a last-minute deal in May 2011 to raise the US debt limit by $2 trillion, to $14.3 trillion. The standoff prompted ratings firm Standard & Poor's to issue an unprecedented debt downgrade of the world's biggest economy by a notch from its sterling AAA rating.
A related deal threatens to force automatic spending cuts and tax increases by the end of 2012 - the so-called fiscal cliff - because the administration and lawmakers couldn't hammer out a plan on their own. Fears of such draconian measures, on top of the bitter debt ceiling debate, have instilled rare doubt among investors over the US government's creditworthiness.