Much like his predecessor, the current president is eager to talk about the benefits of his policies but reluctant to confront their costs.
There is one surefire way to know when someone is trying to pull one over on you: If they’re promising something for nothing — whether it’s a tax cut that pays for itself or an investment strategy that offers a higher return and lower risk — then you need to be on your guard.
Jason Furman, who chaired the White House Council of Economic Advisers under Barack Obama and now teaches at Harvard, recently published a thoughtful critique of former President Joe Biden’s economic policy. He identifies many policy errors, as well as a few things that went right. But his main point is a basic principle of economic policymaking: All choices come with tradeoffs.
The Biden administration believed it could spend trillions of dollars without overheating the economy, and it got inflation. It tried to revive the semiconductor industry with huge subsidies, then required any recipients to provide child care, adhere to crippling regulations and hire only unionized labor. It bought into the promise that the US could build a green economy to save the planet without anyone having to pay more or make do with less. In the end, the economy recovered after the pandemic, but real wages barely improved, inflation risk returned, and the US is deeper in debt.
Continue reading the entire piece here at Bloomberg Opinion (paywall)
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Allison Schrager is a senior fellow at the Manhattan Institute and a contributing editor of City Journal.
Photo by Michael Ciaglo/Getty Images
