OPINION:
With the nation suffering from high unemployment, tepid growth and low confidence, President Obama on Friday made a bold change - he slightly rearranged his economic team. Austan D. Goolsbee, who has been at Mr. Obama’s side since his 2004 Senate campaign, now heads the Council of Economic Advisers. Mr. Goolsbee replaced Christina Romer, who once again is teaching at the University of California at Berkeley.
It’s hard to blame her for returning to the job in which she collected $249,277 from Golden State taxpayers in 2008. Mr. Obama’s advisers, insulated from the effects of a recession that has devastated the private sector, have less reason to question the wisdom of diverting the nation’s wealth into the public sector. It’s no coincidence that Mr. Goolsbee dedicated a good deal of his energy in academia to defending the claim that increased tax rates have little effect on how hard people work. It’s as if we were playthings in his economic laboratory who aren’t supposed to know what’s going on.
Last September, for example, Mr. Goolsbee tried to disguise the fact that Obamacare imposed new taxes. He insisted that the “fee” imposed on those who don’t buy health insurance wasn’t really a tax because whenever someone without health insurance is hurt and requires health care, that imposes costs on everyone else. Now that the health care proposal is law, the administration has dropped the pretense, and the government’s official position in a federal court case is that this Obamacare levy, in fact, is a new tax.
Mr. Goolsbee also likes to disguise the spending side of Mr. Obama’s policies by invoking former President George W. Bush. In June 2009, Mr. Goolsbee told Fox News Sunday that “compared to the actual policies that George Bush had in place, what they call the current policy baseline, Obama is cutting the deficit more than $2 trillion over the 10 years compared with what he was inheriting.” With a federal debt of $14.3 trillion and a 2010 deficit of $1.3 trillion, Mr. Obama has little standing to criticize Mr. Bush for the $459 billion deficit posted in fiscal 2008.
The economy will not fully recover until the president moves away from the failed tax-and-spend government stimulus policies of the New Deal era. Entrepreneurs are not going to risk their capital so long as they know that the likes of Mr. Goolsbee will continue to advise the president to tax away any potential reward. It’s up to voters in November to decide whether to use Congress to promote a pro-growth change that investors can believe in.
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