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Henderson on Furman and Summers

Summary:
The negatives are many. They [Jason Furman and Larry Summers] claim that tax increases are savings; they assume that tax cuts and government spending increases are necessary to get us out of recessions; they assume that we are in an era of “secular stagnation,” that is, low growth; they claim that failure to increase spending on infrastructure, education, and scientific leadership is more of a burden on the next generations than the national debt is; and they think that extending unemployment benefits during recessions is a clearly good idea. Some of these claims are outright wrong, and the ones that are not clearly wrong are, at best, questionable. This is from my “Furman, Summers, and Taxes,” Defining Ideas, May 1, 2019. Another excerpt: These are bright guys.

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The negatives are many. They [Jason Furman and Larry Summers] claim that tax increases are savings; they assume that tax cuts and government spending increases are necessary to get us out of recessions; they assume that we are in an era of “secular stagnation,” that is, low growth; they claim that failure to increase spending on infrastructure, education, and scientific leadership is more of a burden on the next generations than the national debt is; and they think that extending unemployment benefits during recessions is a clearly good idea. Some of these claims are outright wrong, and the ones that are not clearly wrong are, at best, questionable.

This is from my “Furman, Summers, and Taxes,” Defining Ideas, May 1, 2019.

Another excerpt:

These are bright guys. I was an economist with Summers at President Reagan’s Council of Economic Advisers (CEA) when our boss was Harvard professor Martin Feldstein, and I saw up close how sharp he is. You would expect that from someone who had two uncles (Paul Samuelson and Kenneth Arrow) who earned Nobel Prizes in economics. I have never met Furman, but he was chairman of the CEA under President Obama. Again, these are accomplished guys. Don’t they ever think it might be better to have less government spending in areas where government has done badly and let people spend their own money? Apparently not.

Read the whole thing.

David Henderson
David Henderson is a British economist. He was the Head of the Economics and Statistics Department at the OECD in 1984–1992. Before that he worked as an academic economist in Britain, first at Oxford (Fellow of Lincoln College) and later at University College London (Professor of Economics, 1975–1983); as a British civil servant (first as an Economic Advisor in HM Treasury, and later as Chief Economist in the Ministry of Aviation); and as a staff member of the World Bank (1969–1975). In 1985 he gave the BBC Reith Lectures, which were published in the book Innocence and Design: The Influence of Economic Ideas on Policy (Blackwell, 1986).

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