WASHINGTON -- Top Republican presidential contender Mitt Romney is relying on the advice of two revolving door lobbyists and two former chairmen of the Council of Economic Advisers (CEA) under President George W. Bush to develop his plan for creating jobs. All four are top-tier names within conservative economic circles, but each also brings a set of potential problems for Romney's campaign.
Romney's new economic team, announced on Tuesday, includes Columbia Business School Dean Glenn Hubbard, CEA chairman from 2001-2001; Harvard economist Greg Mankiw, CEA chairman from 2003-2005; former Minnesota congressman-turned-lobbyist Vin Weber and former Republican senator from Missouri Jim Talent. Their combined records include lobbying for stimulus funds and in favor of cap and trade, advocating for the Federal Reserve's quantitative easing policy and refusing to divulge conflicts of interest with big businesses seeking influence in the government.
Each of those moves goes against the current of the ongoing, hard-right economic turn of the Republican primary electorate.
Weber, who is both the managing partner at the lobbying firm Clark & Weinstock and a regular unpaid operative for GOP campaigns, was a hired lobbyist for troubled government-sponsored housing giant Freddie Mac during the run up to the 2008 economic collapse. He also helped companies win money from the Obama administration's 2009 stimulus bill.
The Indianapolis-based community health care network, Health Net, won $10.4 million in stimulus funds while employing Weber and other Clark & Weinstock lobbyists. Broadcom, another Weber client, used stimulus tax credits for increased research investment to save $3 million in 2009.
The giant aluminum manufacturer Alcoa, which was a major supporter of the cap-and-trade proposal to reduce greenhouse gas emissions, also employed Weber as a lobbyist. Cap and trade is opposed by all of the current Republican presidential candidates, including Romney.
Mankiw is a prolific blogger and writer and has also taken positions at odds with the current economic ideology of the Republican Party. After the 2008 economic collapse, Mankiw wrote in the New York Times:
If you were going to turn to only one economist to understand the problems facing the economy, there is little doubt that the economist would be John Maynard Keynes. Although Keynes died more than a half-century ago, his diagnosis of recessions and depressions remains the foundation of modern macroeconomics. His insights go a long way toward explaining the challenges we now confront.
While Mankiw did not support the type of stimulus spending advocated by Kenyes and by extension President Obama, he did favor creative activity from the Federal Reserve, including the purchasing of financial assets, known as quantitative easing.
This very Fed policy recently came under attack from Romney's chief GOP primary opponent, Texas Gov. Rick Perry. In August, Perry stated that people in Texas would treat Federal Reserve Chairman Ben Bernanke "pretty ugly" if he were to continue a quantitative easing policy. Perry deemed such a continuation a political maneuver to boost the electoral prospects of President Obama and called it "almost treasonous."
Romney has also opposed another round of quantitative easing from the Fed, though he used less inflammatory language than Perry. "Another round of quantitative easing is not the solution for the economy, and could mean inflation down the road," Romney said in August.
Mankiw's writing has created problems for the campaigns with which he has been connected. In 2004, the Bush presidential reelection campaign distanced itself from a sentence Mankiw wrote in an economic report: "Outsourcing is a growing phenomenon, but it's something that we should realize is probably a plus for the economy in the long run." After taking heat from both the Bush campaign and then-Speaker of the House Dennis Hastert (R-Ill.), Mankiw walked back the idea, stating, "My lack of clarity left the wrong impression that I praised the loss of U.S. jobs. ... It is regrettable whenever anyone loses a job."
Talent, a former senator from Missouri, is now the co-chairman for Mercury Public Affairs, a lobbying firm based in that state. Unlike Weber, he has not registered as a lobbyist, allowing him to avoid divulging the clients that he serves. But Talent's bio on the Mercury site lists "lobbying" as one of his "actions" available to clients.
Hubbard, Bush's first CEA chairman, has taken flack recently for his appearance in Charles Ferguson's Oscar-winning documentary "Inside Job," which documented the 2008 financial collapse and the conflicts of interests of those involved. Hubbard, who is the dean of Columbia University's Business School, was confronted in the film about performing consulting work for financial firms while occupying a prestigious university chair; he refused to divulge his clients and board memberships.
Hubbard is a board member of KKR, BlackRock, and MetLife, among other companies. He was also a board member of Capmark, a commercial mortgage lender that was co-owned by a group of companies that includes KKR and Goldman Sachs before it filed for bankruptcy in 2009. All of these companies have interests before the federal government, including the many regulations to be implemented under the Dodd-Frank financial reform law, which Romney and the other GOP candidates oppose.