Sunday, May 28, 2017

Trump's Fairy-Dust Budget

Larry Summers, American economist, former Vice President of Development Economics and Chief Economist of the World Bank (1991–93), senior U.S. Treasury Dept. official throughout President Clinton's administration (ultimately Treasury Secretary, 1999-2001), and former Director of the National Economic Council for President Obama (2009-2010), former President of Harvard University (2001-2006), on the subject of Trump's budget:
Summers, May 23: "Apparently, the budget forecasts that U.S. economic growth will rise to 3.0 percent because of the administration’s policies — largely its tax cuts and perhaps also its regulatory policies. Fair enough if you believe in tooth fairies and ludicrous supply-side economics.

"Then the administration asserts that it will propose revenue neutral tax cuts with the revenue neutrality coming in part because the tax cuts stimulate growth! This is an elementary double count. You can’t use the growth benefits of tax cuts once to justify an optimistic baseline and then again to claim that the tax cuts do not cost revenue. At least you cannot do so in a world of logic."
Click here for a thorough dissection of the disastrous Trump budget proposal in USA Today, an article entitled "Fact check: Double-counting growth in Trump's budget," by Robert Farley at


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