Romney Urges 'Holding Period' to Avoid Fiscal Cliff

Mitt Romney urged President Barack Obama Thursday to impose a year-long "holding period" on looming defense and other budget cuts to allow more time to work out a spending and tax plan with Congress that "makes sense."
 

At the same time, Romney said in an interview with the Fox Business Network that he would not reappoint Ben Bernanke as chairman of the Federal Reserve and does not believe a plan for a third, large-scale asset purchase program by the Fed, referred to as QE3, would do anything to help stimulate the economy.
 

"My view has been that I would want to select someone who was a . . . new person to that chairman's position, someone who shared by economic views, that I thought was sympathetic to the needs of our nation," Romney said.

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"I want to make sure that the Federal Reserve focuses on maintaining . . . the monetary stability that leads to a strong dollar and confidence that America is not going to go down the road that other nations have gone down, to their peril," he added.
 

Asked about the possibility of another Fed effort to help stimulate the economy, the presumptive Republican presidential nominee said, "I don't think QE2 was terribly effective. I think a QE3, another . . . Fed stimulus is not going to help this economy.
 

"I think that's the wrong way to go," he continued. "I think it also cedes the kind of potential for, for inflation down the road that would be harmful to the value of the dollar and I think harmful to the stability that, that our nation needs."
 

Romney also weighed in on the end-of-the-year "fiscal cliff" problem rapidly approaching, saying  the "immediate thing that needs to be done" to avoid more economic trouble is for the president to call Congress back in to address the automatic spending cuts and tax increases scheduled to begin in January.
 

"The president, as the leader of the nation, needs to call together Congress and make sure that we do not have the kind of 'cliff' that's being described," he said, noting the so-called "Taxmageddon" and defense cuts coming in January could lead to a 2 percent reduction in GDP.
 

"We should, instead, put in place a, a holding period, if you will, let's say a year or so, or at least six months, to allow the next president, whether it's President Obama or me, to put in place a spending plan, a tax plan that makes sense," Romney added.
 

He said the sequestration, or the automatic Defense Department cuts to be triggered at the end of the year, are likely to have "an amazing and negative effect on the workers of America."

"Likewise," he said, "raising taxes on middle-income families as the plan currently calls for is the wrong way to go.
 

"And the president should take leadership -- that is why he's president, to work out an arrangement, to make sure that we're able to have a runway that allows the new president to put in place a more permanent and . . . appropriate solution."

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Romney added that if he were in the White House he would use a holding period on taxes and spending negotiated with Congress to "keep the status quo in place with regards to tax policy, military spending and the like" until he could work out a new tax program and a new budget.
 

"I look forward to having a president," he added, "that will actually lead, and have budgets, and have policies that get America on track to . . . economic sanity."