The most optimistic case for the 2013 economy that I can work out in my head is to assume that the White House has more influence over monetary policy in practice than appears to be the case on the surface. Then we can hope that Mitt Romney has a clearer grasp of the importance of the Federal Reserve to our economic woes than the Obama administration has. Then perhaps if Romney wins his new administration will be able to generate some easing and a labor market recovery. But on Meet The Press this morning, Romney tried to disabuse me of my hopes. Does he think the Fed should shift policies to support a labor market recovery? No:
I don’t think that easing monetary policy is going to make a significant difference in the job market right now.
This is, fortunately for America, not nearly as pernicious as some of the hard money dogmas that Paul Ryan has spouted over the years. But it also indicates that Romney has no clue about what is, in reality, the most powerful tool available for bolstering the labor market. I'm harboring some hope that Romney is a closet Keynesian who would unleash expansionary policies in office, but if he is he continues to keep the secret pretty well.