January 29, 2018

Dem Econ Adviser Goolsbee Now Worried About Deficits, Spins Obama’s Debt Buildup

Filed under: Economy,Taxes & Government — Tom @ 2:32 pm

On Friday, Austan Goolsbee, an early-years Chairman of Barack Obama’s Council of Economic Advisers, appeared on Neil Cavuto’s Fox Business show. Goolsbee falsely characterized the new tax law’s impact on corporations’ repatriation of funds, and echoed the Democratic Party’s deliberately distracting and irrelevant spin about the Obama era’s record debt buildup and budget deficits. Any good Econ 101 prof would have given his performance an “F.”

Cavuto’s full Friday episode is here.

Goolsbee treated the reduced tax rate of 15.5 percent on money repatriated from overseas as a giant giveaway. When Cavuto pointed out that the corporate funds involved are “their money,” Goolsbee played “Squirrel!” with a straw-man question no one is asking: “Do you think the tax rate should be zero?” He even appeared unwilling to concede that it really is these companies’ money. He also attempted to argue that the government would have to borrow money because of the tax collected on repatriated funds. The fact is that the government will have to borrow less money than it otherwise would have because significant repatriations will actually occur.

As seen below, Cavuto then confronted Goolsbee over his two-faced posture on deficits. Note how Goolsbee changed his argument from “debt” to “the deficit” in mid-stream to repeat a long-held Democratic Party talking point which proves nothing:

Transcript (from 0:12-0:50; bolds and italics are mine):

AUSTAN GOOLSBEE: If you’re not going to pay for the tax cut, if you’re just going to borrow the $3 trillion that it would take to pay for it, then it it perfectly appropriate to ask “Are we getting our money’s worth?

NEIL CAVUTO: You guys never paid for all the spending you did, Austan. You guys never paid for all the spending you did. We added $10 trillion to the debt.

GOOLSBEE: That’s not correct. That’s not correct. You are simply, factually stating things that are not correct.

CAVUTO: Did the debt go up $10 trillion on your watch or did it not?

GOOLSBEE: The debt went up at the beginning of the administration, as you know, because we had the deepest recession of our lifetime. We then cut the deficit more than in half by the end of his first term.

Goolsbee stated “things that are not correct.”

The Obama administration added $9.32 trillion to the national debt ($19.95 trillion on January 20, 2017 minus $10.63 trillion on January 20, 2009). Cavuto was essentially right.

The Obama administration increased the national debt substantially during every fiscal year and stub period:


As to Goolsbee’s talking points-driven shift from the debt to deficits, it is narrowly true that the fiscal 2013 deficit was less than half of fiscal 2009:


But so what? Goolsbee disingenuously failed to note that:

  • The Obama administration is the only one which has ever posted trillion-dollar deficits.
  • It continued to run trillion-dollar deficits over three years after the recession’s official end.
  • It ran seven of the eight highest full-year deficits then on record.

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