As a consequence, uncertainty over policy—particularly over tax and regulatory policy—slowed the recovery and limited job creation. One recent study by Scott Baker and Nicholas Bloom of Stanford University and Steven Davis of the University of Chicago found that this uncertainty reduced GDP by 1.4% in 2011 alone, and that returning to pre-crisis levels of uncertainty would add about 2.3 million jobs in just 18 months.
(Matthew O'Brien points out that this uncertainty was driven by the debt ceiling crisis and the European crisis, but that's somewhat off-topic for this post.)
Without getting into the weeds here (or mentioning how close the idea of fear of uncertainty affecting the economy comes to sounding like Keynes talking about animal spirits), my question here is how have Romney decisions affected uncertainty. I'm sure Hubbard would argue that Romney has a good chance of winning in November which would mean we would have a good chance of seeing Romney's policies implemented, but Romney has been extremely reluctant to release specifics.
If you need to make a business or investment decision that depends on tax policy, you have no way of accurately evaluating that decision until the election is decided and, in the event of a Romney victory, actual proposals are made in 2013. We're talking six months here, closer to to twelve if you include time for the legislation to pass and the dust to settle. Therefore doesn't Hubbard's point about uncertainty imply that Romney is hurting the economy by refusing to supply essential information to businesses and investors?
(Much of this applies to Paul Ryan as well.)
I can imagine valid arguments for keeping policies broad and open-ended early in the process and I can imagine valid arguments for the need to reduce uncertainty.
But for the life of me, I can't imagine a valid argument for both.