Romney Beats Obama in Debate, Round One, The Atlas Society | Ayn Rand, Objectivism, Atlas Shrugged

It was the battle of the blue suits, round one, in the presidential debates. There were no major gaffes and no absolute knockouts.

Pundits generally agreed that Mitt Romney came out on top. He was aggressive, on the offensive, and in command of his facts. President Obama seemed uncomfortable and did not counter Romney tit-for-tat.

Friends of freedom focused especially on Romney’s performance. He represents the party that traditionally favors limited government, though too often in rhetoric rather than reality. Romney was not trying to appeal to libertarian policy wonks like me but, rather, to attract undecided independent voters while energizing his conservative base. But we can still ask how he did in defending the principles and policies of liberty.

Entitlement problem

Most obviously, we have the problem of Romney and the party of limited government posing as the saviors of Medicare and Social Security. Why?

The inherent contradictions of the welfare state are now producing economic and social collapse in Europe even as Obama accelerates America’s decline in that direction. In the past, politicians could ignore the need to make radical changes to entitlement programs. But today, as those programs teeter on the brink of bankruptcy, their problems must be faced.

Despite decades of excellent scholarship on how private individuals and institutions could better provide health care insurance, retirement savings, and the like, Republicans have not done a good job of educating the public on these alternatives to the current government mess. And, frankly, many Republicans are committed to government responsibility for what should be matters for private provision (see “Romneycare” in Massachusetts). Thus, while their policy prescriptions might well give individuals more control over their own money and lives, privatization is, for many Republicans, a dirty word.

Thus, in the debate, Romney offered examples of the advantages of market competition in health care but could not provide a consistent vision for a private system. Too bad Libertarian Party candidate Gary Johnson wasn’t in the debate to provide the true case for liberty!

Heavy hits and doing better

Romney hit Obama effectively on many points where the president’s anti-free market policies are damaging the economy. For example, Obama argued that “under my plan, 97 percent of small businesses would not see their income taxes go up.” Romney countered that “businesses that are in the last 3 percent … happen to employ half— half —of all of the people who work in small business. Those are the businesses that employ one quarter of all the workers in America. And your plan is take their tax rate from 35 percent to 40 percent.”

Obama criticized a $2.8 billion tax break for oil companies. While acknowledging that with lower overall tax rates that tax break possibly would not survive, Romney pointed out that Obama “provided $90 billion in breaks to the green energy world … that's about 50 years' worth of what oil and gas receives.” And “this $2.8 billion goes largely to small companies, to drilling operators and so forth.”

Obama argued that “oil and natural gas production are higher than they've been in years.” Romney countered that “all of the increase in natural gas and oil has happened on private land, not on government land. On government land, your administration has cut the number of permits and licenses in half. If I'm president, I'll double them. And also get … the oil from offshore and Alaska. And I'll bring that pipeline in from Canada.”

Conservative commentator Pat Buchanan said Romney’s debate performance was excellent and that he couldn’t imagine Romney doing any better.

But let me suggest several areas where improvement might help both his electability and the prospects for liberty.

Wrong on regulations

When asked about the financial services industry, Romney said, “Regulation is essential. You can't have a free market work if you don't have regulation.” He added, “You couldn't have people opening up banks … in their garage and making loans.” Really? What about a computer company? Would Mitt have jailed Steve Jobs for running Apple where cars should have been parked?

Obama asked, “Does anybody out there think that the big problem we had is that there was too much oversight and regulation of Wall Street?” Well, yes! Here’s where Romney missed a teaching moment.

He could have started with Obama’s statement that banks “were giving loans and mortgages that really shouldn't have been given, because … folks didn't qualify.” Government bank regulators set the standards that mandated banks to make such loans.

Furthermore, after the dot-com bubble burst a dozen years ago, the Federal Reserve, which controls money, pumped credit into the economy. Looking for a new place to invest, many borrowers chose real estate.

Next, the government-chartered Fannie Mae and Freddie Mac created a market for bad loans with the implicit wink-and-nod assurance that if problems arose, the government would step in and straighten things out.

And yes, investors made stupid decisions as well. But the widespread nature of the economic collapse was principally the fault of the government.

Romney might have made these points and, instead of expressing love for regulations, might have put Obama on the defensive. He might have argued that private property rights and laws barring fraud make such government regulations unnecessary.

Teaching about teachers

Another important teaching moment that Romney missed concerned teachers. Obama kept repeating that the country—read, government—needs to “invest” in more teachers and in education. He said, “I want to hire another hundred thousand new math and science teachers.”

Romney might have pointed out that since 1970 real inflation-adjusted per-pupil government spending on schools has nearly tripled. In real dollars federal spending on education has more than doubled, with a large spike coming under President Bush with his “No Child Left Behind” program. In each election politicians clamor for more money for schools and teachers and more money is spent. But achievement scores for three decades have remained flat.

The problem is government involvement both in financing and running schools because the consumers—parents and their children—have little choice in the matter. Most Americans understand that we don’t need government to provide consumer goods like TVs, iPads, smartphones, and the like. Wouldn’t it be best to allow the same free-market choice that produces new and better ways to communicate and share information to provide education services as well?

But in the debate Romney offered that “the federal government also can play a very important role,” while arguing that education funds would be better spent in the laboratories of the states. So what about the laboratory of the market?

For the future

Romney’s debate performance will no doubt sway many undecided voters. And he did make points that friends of freedom should appreciate.

But in the future, especially if Romney is elected, he and the GOP will need more consistent policies in favor of the free market and limited government. They might slow the slide to an EU-like collapse, but reversing it will require a more radical reversal of current statist policies.
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Hudgins is director of advocacy for The Atlas Society.

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