Austan Goolsbee evades answering excellent question about why the Obama administration switched from a stimulus policy that worked to a cutting strategy that won’ t @ TheDailyShow #austangoolsbee

Jon Stewart the comedian asked a devastating question of Austan Goolsbee President Obama’s chief economic advisor who is leaving office about how come if the administration had argued correctly over and over again that the stimulus had worked to create  growth and jobs it had switched to the exactly contrary policy of making cuts in spending when the unemployment rate was still so high. Goolsbee basically evaded answering this excellent question and after muttering a few words about how once the economy had avoided a depression it was time to cut the deficit as if deficit cutting was somehow job creation when it is in these circumstances exactly the opposite. There seems to be a clear lack of solid analysis and thinking at the heart of the Administration on these critical questions. Also people should understand that what counts above all is aggregate demand and if one  cuts the total of government spending simply shifting some of the remaining money from one program to another that is more sharply focused on job creation won’t be enough to overcome the overall weakening of aggregate demand.


About haroldchorneyeconomist

I am Professor of political economy at Concordia university in Montréal, Québec, Canada. I received my B.A.Hons (econ.&poli sci) from the University of Manitoba. I also completed my M.A. degree in economics there. Went on to spend two years at the London School of Economics as a Ph.D. student in economics and then completed my Ph.D. in political economy at the University of Toronto. Was named a John W.Dafoe fellow, a CMHC fellow and a Canada Council fellow. I also was named a Woodrow Wilson fellow in 1968 after completing my first class honours undergraduate degree. Worked as an economist in the area of education, labour economics and as the senior economist with the Manitoba Housing and Renewal Corporation for the Government of Manitoba from 1972 to 1978. I also have worked as an economic consultant for MDT socio-economic consultants and have been consulted on urban planning, health policy, linguistic duality and public sector finance questions by the governments of Manitoba, Saskatchewan,the cities of Regina and Saskatoon, Ontario and the Federal government of Canada. I have also been consulted by senior leaders of the British Labour party, MPs from the Progressive Conservative party, the Liberal party and the New Democrats on economic policy questions. Members of the Government of France under the Presidency of Francois Mitterand discussed my work on public sector deficits. I have also run for elected office at the municipal level. I first began to write about quantitative easing as a useful policy option during the early 1980s.
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