If You Don’t Want to Make Sense, You Can Say Anything

September 22nd, 2011 at 10:24 pm

One reason to have a blog is so you can follow up frustrating TV debates with facts that were abused in the segment.  I was arguing with a couple of CEOs on Larry Kudlow’s show tonight on CNBC about why the stock market tanked today.  They said it was a failure of leadership, I said it was a failure of growth.

Neither side convinced the other (I’ll get the link up tomorrow).

But here’s mistake they made: the CEOs argued that a) President Obama’s plan raised too much in tax revenue, and b) Bowles/Simpson plan was much better and Obama made a big mistake not adopting it.

What I kept trying to tell them—and all three, including Larry the K got this wrong—was that Bowles/Simpson raises more revenue than Obama.

In fairness, it’s an easy mistake to make.  As shown in their Table 3 here, Bowles/Simpson raises about $1 trillion in new revenue.  But that’s above the revenue you get from allowing the highend Bush tax cuts to sunset, which, unlike the President, they assume in their baseline.  Adding those revenues back in, and updating to be comparable with the President’s proposal, gets B/S up to about $2 trillion, as shown in Table 4 here from the Committee for a Responsible Budget.

The President’s plan counts the highend Bush revenues in its $1.5 trillion total.  So B/S raise about half a trillion more in revenue than the President.

If you want to make sense, you can’t critique the President for both raising too much revenue in his plan and not enacting Bowles/Simpson.   If you don’t want to make sense, well…then you can say anything.


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3 comments in reply to "If You Don’t Want to Make Sense, You Can Say Anything"

  1. Anthony Miller says:

    Dr. Bernstein,

    Larry Kudlow and the CEO’s he brings on the show are not interested in the facts. They are trying to bash President Obama by disseminating false information. Larry Kudlow is an imbecile who is making a lot of money to parrot FOX and its pundits. How can anyone looking for credible information can go to CNBC when its agenda is to spin things to either favor businesses or do harm to a President or Party not liked by Wall Street.

  2. general c. san desist says:

    …the old news stirs new questions. Is this the same three years of ineffective response relived from 1929? Hoover threw everything Congress allowed at the beast…to the detriment of future action. The best advisors cautioned massive government intervention would stifle business. Sounds familiar.

    Is this 1932 or 1937? Are we in the era of pre-stimulus of Roosevelt or the relapse recession of debt reduction efforts of 1937?

    As with Hoover in ’32 the Summer of Recovery was their motto in light of the most perceptive forecasts that predicted another year of falling demand. Are we at the point where, as in ’32, the bankers of Wall Street & business in general are as discredited as a rainmaker in a drought because they sat on the sidelines with band aid treatments for major trauma wounds?

    Are the astronomical salaries & bonuses delivered to those running the glorified gambling casino, where the odds are weighted heavily against the eager outsiders, warranted in light of the latest census figures. The conservative brotherhood is pushing the line that less millionaires shows they are suffering too…wrong, real estate is the variable in that equation.

    This is 1932…with a long road ahead. We have not even started to address the core issue…demand. The alphabet of recovery projects is upon us…PWA anyone? Maybe have the youth of the nation clear the forests of detritus & undergrowth debris? Tariffs on solar & wind alternatives before we lose (give away) another technology we kick ass in? How is the kudzu clean up going while more waterways are chocked of life? Can we harvest the pest and convert to biofuel? One could go on & on & on. Just wondering where the imagination went?

    Are we men or mice…pass the cheddar, as Ms. Latella would say.

  3. Jim Edwards says:

    Ah yes, many’s a time just as the satellite uplink shuts down I think of the perfect rejoinder and rush to my blog to post “Oh, Yeah!”

    I’m teasing of course, but really one of the reasons to have a blog has nothing to do with TV. There are millions of blogs and only hundreds of people on TV.

    I read your blog because it provides a nice quick synopsis of the days economic news from an economists perspective. I read Paul Krugman’s blog to get stupid things the Heritage Foundation and Cato, and sadly the ECB and too many Feds, had to say today. I read Calculated Risk to get the drilled down details I don’t have to search for myself.

    I like your blog because it feels personable and accessible. You take the time to respond to your readers and incorporate some ideas from posts.

    While I enjoy your appearances on TV, I do not read your blog to hear rebuttals that should have been made. I read it because I’m half way around the world and your voice on this blog is a great way for me to keep up in the absence of a 24hr cable service.

    Keep up the great work both on TV and off, but please don’t conflate the two. Each has value on its own merit.

    Thank you,