Ed Conard debates Alan Krueger on Obama’s economic record and if he’s to blame for slow growth on Bloomberg’s “In the Loop with Betty Liu.”
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Liu: I want to bring up a [Quinnipiac] poll that ranks President Obama—Alan, this is to you—No. 1 in a category he doesn’t want to be in. He is considered the worst president of the postwar era. The New York Post, which I have here, as you an see on your screens, had him at 33%. Thirty-three percent of voters thought he was the worst president since 1945. To be fair, George W. Bush ranked second, at 28%, followed by Richard Nixon, at 13%, and Jimmy Carter, by the way, at 8%. Perhaps not a surprise, Alan, if you look at the jobs report. What’s your reaction to this?
Krueger: You know, the President came in facing the worst economic circumstances since any President since Franklin Roosevelt. Franklin Roosevelt cleaned up the mess that was left to him. President Obama has been doing that, not as quickly as he would like, not getting as much support from Congress to help. But we’re in an upward trajectory, and I’m quite confident that when these polls are taken again in the future, the President will be on the list of the best presidents in the postwar period.
Liu: Ed.
Conard: I think that the administration came in, they had Keynesian models which way over predicted the rebound. They were betting on that. They thought fiscal stimulus and monetary stimulus would have a big impact on the economy. It had almost no impact at all, which is the other side of the argument. They didn’t believe it. That’s the only thing they tried. They didn’t do anything else.
Congress imposes constraints, thank God. The Republicans impose constraints. They’ve been unwilling to work within those constraints. There’s all kinds of stuff they could have gotten done—entitlement reform, H-1B visas, and other things where they shifted spending priorities around inside of the budget as opposed to try to add to the spending. They didn’t do any of that. And here we are today, five years later, mediocre growth off a permanently lower base.
Krueger: That just misreads the last five years.
Conard: [Laughs.]
Krueger: You know, the private sector has expanded as much in this recovery as it did in the previous recovery, in spite of all of the harm caused by the financial crisis. The reason why GDP growth is not stronger is because government has been cutting back, especially state and local governments, but also the federal government, we’re cutting defense spending.
Liu: Right.
Krueger: And then Ed mentions immigration reform. The Senate passed bipartisan immigration reform, the President supported it. Speaker Boehner informed the President he’s not going to bring it up. So—
Liu: Well, immigration reform is a great point, Ed. I mean, you know, the Republicans have time and time again said that they have blocked any reform on immigration.
Conard: [No, it’s not]. There’s two issues in immigration. There’s high skilled immigration. Low skilled immigration, very complicated, high skilled immigration, easy. The Democrats have held the two together, held high skilled immigration hostage in order to negotiate on low skilled immigration. We could have had high skilled immigration long ago, but we haven’t, and low skilled immigration is going to take a lot of negotiation and a lot of compromise on both sides—
Liu: Right, because that gets into the issue of border security.
Conard: —on both sides to get done. But one thing I would say, more importantly, is on the economy and on the rebound, okay, government spending is not in jobs anymore, it’s in government spending. And when you look at government spending as a percentage of GDP, it rose to unprecedented, maybe back to World War II levels. And the numbers you’re citing are numbers from after there was a big increase, how much more growth did we have after that, the growth was slower. But if you really look at the—
Liu: Alan?
Krueger: That’s not correct—
Conard: —overall spending and growth—
Krueger: If you look compared to the—
Conard: There’s no way it slowed down the recovery.
Krueger: Oh, you’re absolutely wrong. Just look at the numbers. Discretionary spending has been cut dramatically because of the misguided sequester—
Conard: Discretionary spending has, as the [rest has shown].
Krueger: And his point on immigration reform is also wrong. We need comprehensive immigration reform. We need to take the people out of the shadows who are here, put them on a path to legal status and citizenship at the back of the line, as the Senate did with the bipartisan vote. And I actually think it’s a bit demeaning to say high skill, low skill. It’s comprehensive. The other immigrants can be quite high skilled if they get the training that they would get if they were out of the shadows.
Conard: Well, not—
Liu: That might cut through the argument.
Conard: —not in any short-term time frame that’s going to affect the recovery. And you focus on discretionary spending, but you don’t talk about the total, so you made a qualification there that—
Krueger: But even on the total—
Conard: —that makes a big difference.
Krueger: But even on the total, the President offered entitlement reform.
Liu: Okay.
Krueger: It was Speaker Boehner who walked away from the table.
[End of recording.]