On Fox News Sunday, Austan Goolsbee, chief economist for the President’s Economic Recovery Advisory Board, answered some questions from Mike Wallace. Goolsbee, a decorated orator with several international championships under his belt as a competitive extemporaneous speaker, proved adept at answering questions by saying nothing at all.
Though Goolsbee is a Sloan Fellow, Fulbright Scholar, and has received a Ph.D. in Economics from MIT, he seems to also be educated in purposeful avoidance of important questions. During the interview, Goolsbee struggles with the administrations apparent inability to control unemployment numbers, or the actions of private corporations, despite the promise of endless billions from the Obama administration.
Below are segments of the transcript from Goolsbee’s rope-a-dope. I think you will find Austan Goolsbee says a lot without saying much at all.
WALLACE: The president is also set to announce billions of dollars in federal aid to open up lending to small businesses. What do you hope to accomplish?
GOOLSBEE: The — the market for credit to small businesses is completely frozen in an already terrible credit crisis. […] And so we’re trying to reignite through direct intervention the small business credit market so that they can — so that they can expand.
WALLACE: Last month you gave a magazine interview in which you said that we should see signs the stimulus plan is working within six months, and one of the key indicators, you said […] is if unemployment rises to the 8 percent range rather than the 11 percent that some are predicting.
What’s your revised estimate now that it’s already 8.1 percent for unemployment this year?
GOOLSBEE: I agree we’ve gotten some bad news on the labor market front, so that the — trying to keep the unemployment rate in the 8 percent range — we’re already in the 8 percent range.
I still think it is vital that by the end of the year that we try as hard as we can, through whatever means that we have — and the president has tried to do so — to keep the unemployment rate from getting into the multiple double-digit range that people were forecasting before that policy.
WALLACE: So you’re talking under 10 percent [unemployment].
GOOLSBEE: Ten, 11 percent people were forecasting — what would happen without any policy intervention. Now, we have passed […] the biggest financial rescue package that we have seen in decades, the largest stimulus probably in the history of the country, the biggest home foreclosure prevention and mortgage assistance program since the Depression.
Those three actions together are really very dramatic. They have just — the first checks from the stimulus haven’t even gone out, so I think that it’s, in my view, premature to be talking about what else is going to be necessary until we see how those things have worked.
WALLACE: How much will the government have to spend in guarantees against losses to get those private investors to buy these toxic assets? Geithner, at a hearing talked about another trillion dollars. In the president’s budget, he has a placeholder of $750 billion.
Are we talking about a program in the 7, $8 trillion dollar range?
GOOLSBEE: I’m not going to speculate on that number, because we haven’t done the bank — we have not completed the bank examinations that allow us to answer that question.
WALLACE: But does this mean another, in effect, TARP III, another big relief program?
GOOLSBEE: I’m not going to speculate on that. We have to do the bank examination to answer that question.
WALLACE: Finally, I want to get into a little bit of the Obama budget with you — $3.6 trillion, which calls for major tax increases on the wealthy.
And I want to read you something from the president’s budget. “While middle-class families have been playing by the rules, living up to their responsibilities as neighbors and citizens, those at the commanding heights of our economy have not.”
Mr. Goolsbee, it’s a blanket statement from the administration. People who make money have not played by the rules?
GOOLSBEE: I think you’re stretching a little bit the blanket statement.
WALLACE: Why make that a moral argument, something wrong?
GOOLSBEE: Well, you’re — you’re taking a line from the introduction that sets the stage for the discussion, which is we need to go back to an issue of balance. So in the ’90s we had a more balanced view. We’ve gotten out of balance.
People at the commanding heights of the economy with incomes over $250,000 a year have been receiving trillions of dollars of tax cuts…