The Romney campaign is now tripling down on its claim that the nation needs fewer public employees — like teachers, firefighters, and police officers — to help rebound the economy.

During an interview with CNN’s John King on Monday evening, Romney campaign surrogate Newt Gingrich defended Mitt Romney’s resistance to hiring “more firemen, more policemen, more teachers” and admitted that the former Massachusetts governor’s policy would lead to less teachers in the classroom:

KING: The president says use federal dollars to help. Governor Romney says no. [...]

GINGRICH: We have to come to grips with how big the challenge is, and does that mean there will be fewer teachers? The honest answer is yes. Does it mean that you’re not going to get quite the same pension plan people have been getting? The honest answer is yes. President Obama may say well, we can borrow our way out of that decision. I don’t think the American people agree with him.

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Gingrich’s comments came in response to Romney’s critique of President Obama’s claim on Friday that the public sector is lagging behind in job growth. President Obama “says we need more firemen, more policemen, more teachers,” Romney said. “Did he not get the message of Wisconsin? The American people did. It’s time for us to cut back on government and help the American people.” Former New Hampshire governor and top Romney surrogate John Sununu defended the remarks earlier on Monday, saying, “the taxpayers really do want to hear there will be fewer teachers,” ignoring the fact that Obama’s job’s plan is fully paid for and would not increase deficit spending.

Federal, state, and local governments have laid off more than 700,000 workers since Obama took office. Had that not happened, the unemployment rate would be a full point lower and the economic recovery would be stronger.

Gov. Chris Christie (R-NJ) has announced that even if the New Jersey state legislature sends him a bill to increase the state’s minimum wage, he will veto it. Christie claims that the result of the bill — which would raise the Garden State’s minimum wage to $8.50 and index it to inflation — would be “more layoffs“:

“We’re telling small business owners that not only are we going to raise their costs by a buck and a quarter, but we’re also going to raise it with these cost-of-living adjustments,” Christie, a 49-year-old Republican, said during a town-hall style meeting in Lyndhurst. “Here’s what’s going to happen — they’re going to have to lay people off.”

Claiming that minimum wage increases will cause job losses is a favorite right wing tactic, but the Center for American Progress Action Fund’s T. William Lester, David Madland, and Nick Bunker note that the economic evidence doesn’t bear it out:

We reviewed academic research that examines the effects of minimum wage increases during a recession or stretch of time with high unemployment and found significant evidence that even during hard economic times, raising the minimum wage is likely to have no adverse effect on employment. [...]

Why is this the case? Studies generally find that policies that increase the compensation of low-wage workers significantly reduce turnover, boost worker effort, encourage employers to invest in training for their workers, and can increase demand for goods and services — all of which help balance out any potential negative effects.

It’s not only at the state level that progressives are attempting to increase the minimum wage, which peaked in terms of purchasing power at the federal level in 1968. Last week, a group of House Democrats introduced legislation to raise the federal minimum wage to $10.

In Wisconsin, the senate race to succeed Herb Kohl (D) is heating up between Rep. Tammy Baldwin (D) and four Republican challengers. One GOP candidate, former Wisconsin Gov. Tommy Thompson, has unveiled a tax plan that would give millionaires, himself included, a huge tax cut.

In a recent memo, the Baldwin campaign argued that Thompson’s 15 percent flat tax plan would allow the top 1 percent of earners to pay an average of $86,502 less in income taxes. Politifact and the Milwaukee Journal Sentinel verified Baldwin’s assertion, with the caveat that many of the details of Thompson’s plan have yet to be released.

A Thompson spokesman, though, freely admitted that Baldwin’s analysis of the plan “seems sufficient,” adding that part of the intent of the plan is to raise taxes on the poor who currently don’t make enough money to have any federal income tax liability.

For her part, Baldwin co-sponsored the “Buffett Rule,” which prevents the richest Americans from being able to pay a lower tax rate than middle-class families.

Thompson raked in millions last year advising pharmaceutical companies he was once tasked with overseeing as U.S. Secretary of Health and Human Services. Thompson’s net worth is currently $13 million. And he isn’t the only conservative who would greatly benefit from his own radical tax proposal: 2012 GOP presidential nominee Mitt Romney would save $5 million on his tax bill if his own tax plan were enacted.

– Steven Perlberg

Republican governors across the country are pushing the federal government to give them more leeway to raise revenue through online sales taxes. In a letter last week, Iowa Gov. Terry Branstad (R) joined a growing number of governors calling for federal legislation that would close the so-called “Amazon Loophole,” which allows online retailers like Amazon to avoid collecting sales tax from their customers, giving them an unfair advantage over brick-and-mortar shops.

Currently, states cannot require online retailers to collect sales taxes unless the companies have a physical presence in the state. Nearly a dozen Republican governors have asked their state congressional delegations to support legislation addressing this inequity, The Hill reports:

Branstad’s letter of support, obtained exclusively by The Hill, comes not long after another prominent Republican governor, Chris Christie of New Jersey, also urged Congress to get moving on sales tax legislation. [...]

Christie and Branstad are among about a dozen GOP governors to back the push for online sales tax legislation. Other state leaders who are on board include Mitch Daniels of Indiana, Paul LePage of Maine and Rick Snyder of Michigan.

Virginia Gov. Bob McDonnell, another Republican, approved legislation in his state earlier this year forcing Amazon to collect sales tax. California’s legislature closed its own loophole in 2011. But states without a physical Amazon presence can’t do the same thing. Amazon has threatened states that it would file lawsuits and even move its offices and warehouses if they took similar actions.

Federal legislation to address the loophole isn’t likely to see much action in Congress, though. The House Judiciary Committee will hold a hearing on it next month, but it is not included among the House GOP majority’s legislative priorities for the year. It is unclear if the legislation would pass even if it did receive a vote, given that many congressional Republicans oppose closing the loophole.

Mitt Romney’s presidential campaign isn’t backing off the candidate’s claim that America needs fewer teachers, firefighters, and police officers. Instead, former New Hampshire Gov. John Sununu (R), a top Romney campaign surrogate, backed Romney’s call this morning, telling MSNBC that changes in technology and population shifts have made layoffs of teachers and public safety officials necessary.

Romney’s original comments left little room for interpretation. President Obama “says we need more firemen, more policemen, more teachers,” Romney said Friday. “Did he not get the message of Wisconsin? The American people did. It’s time for us to cut back on government and help the American people.” But to Sununu, the comments highlighted a “real issue” that showed Romney’s “wisdom,” he told MSNBC’s Chris Jansing today:

SUNUNU: Let me respond as a taxpayer, not as a representative of the Romney campaign. There are municipalities, there are states where there is flight of population. And as the population goes down, you need fewer teachers. As technology contributes to community security and dealing with issues that firefighters have to deal with, you would hope that you can, as a taxpayer, see the benefits of the efficiency and personnel that you get out of that.

JANSING: But even if there’s movement to the suburbs, teachers and policemen are needed somewhere.

SUNUNU: But I’m going to tell you there are places where just pumping money in to add to the public payroll is not what the taxpayers of this country want.

JANSING: Do you think that taxpayers of this country want to hear fewer firefighters, fewer teachers, fewer police officers, from a strategic standpoint?

SUNUNU: If there’s fewer kids in the classrooms, the taxpayers really do want to hear there will be fewer teachers. [...] You have a lot of places where that is happening. You have a very mobile country now where things are changing. You have cities in this country in which the school population peaked ten, 15 years ago. And, yet the number of teachers that may have maintained has not changed. I think this is a real issue. And people ought to stop jumping on it as a gaffe and understand there’s wisdom in the comment.

Watch it:

The facts of many of the layoffs don’t back up Sununu’s claims. Classrooms are busting at the seams because there are fewer teachers, and cities and towns across the country are closing entire public safety departments due to budget cuts. And, as Jansing noted, even if the population shifts were a legitimate argument, teachers and public safety officials are still needed where the population moves.

Federal, state, and local governments have laid off more than 700,000 workers since Obama took office. Had that not happened, the unemployment rate would be a full point lower and the economic recovery would be stronger. To Romney and his campaign surrogates, however, those job losses are a step in “the right direction.”

Over the weekend, an op-ed authored by one of 2012 GOP presidential nominee Mitt Romney’s economic advisers appeared in a German newspaper. In the piece, Glenn Hubbard criticized the Obama administration’s approach to Europe’s ongoing economic woes, instead calling for the adoption of more austerity:

“Unfortunately, the advice of the U.S. government regarding solutions to the crisis is misleading. For Europe and especially for Germany,” Mr. Hubbard wrote, according to a translation of his article from the Handelsblatt Web site.

He opposed what he described as the Obama administration’s efforts “to persuade Germany to stand up financially weak governments and banks in the euro zone so that the Greek crisis would not spread to other states.” [...]

Mr. Hubbard proposed a classic conservative pro-austerity, anti-Keynesian approach, arguing that cutting government spending will restore public confidence, encourage growth and avert future tax increases.

“Long-term confidence in solid government financing shores up growth and enables the same scope for short-term transitional assistance,” he said.

Aside from the fact that Hubbard took out an op-ed in a foreign paper in which to blast the President, explicitly taking politics beyond “the water’s edge,” he is advocating for a doubling down on austerity that has simply made Europe’s economic situation worse. As this chart shows, austerity in Europe goes hand-in-hand with a contracting economy:

According to the International Monetary Fund, “Income and employment don’t fully recover even five years after the austerity program is enacted.” Yet that’s exactly the prescription that Hubbard and the Romney camp have in mind for both Europe and the U.S.

Pay for chief executives has skyrocketed over the last two decades, and a new study found that the way executives use their wealth has a direct impact on how their companies operate. “Unfrugal” CEOs — those who spend their massive salaries on luxury goods — aren’t more likely to commit fraud in their personal business dealings. Their companies, however, are more likely to commit fraud, according to the National Bureau of Economic Research:

However, as predicted, we find that unfrugal CEOs oversee a relatively loose control environment characterized by relatively high probabilities of other insiders perpetrating fraud and unintentional material reporting errors. Further, cultural changes associated with an increase in fraud risk are more likely during unfrugal (vs. frugal) CEOs’ reign, including the appointment of an unfrugal CFO, an increase in executives’ equity-based incentives to misreport, and a decline in measures of board monitoring intensity.

The study also found that companies run by free-spending CEOs are “significantly more likely” to make bad business decisions that lead to bankruptcy. But this shouldn’t be shocking: at some of America’s biggest companies, executive compensation is barely tied to the performance of the business.