Snyder, Goolsbee, and Mussa Grade Bush Sternly on the Economy

The Chicago Tribune took an end-of-the-year look at the president’s fiscal performance. They asked three economists with ties to the GSB to review such topics as the deficit, spending, social security, and trade policies. The last time they conducted a survey was prior to the 2004 presidential election.

The Tribune selected GSB Dean and George Pratt Shultz Professor of Economics Edward Snyder; Robert P. Gwinn Professor of Economics Austan Goolsbee; and former GSB professor and a former member of the US Council of Economic Advisers Michael Mussa to represent different points along the political spectrum. According to the article, all three graded Bush sternly.

On Taxes
Goolsbee told the Tribune he felt Bush took a Jekyll and Hyde approach on the Alternative Minimum Tax. First he appeared to take it on, then double-backed and gave campaign donors a large tax cut. Snyder faulted Bush for also failing to do something to help millions of families affected by the AMT. Mussa praised the president for earlier tax cuts, but questioned his ability to sustain them due to spending issues.

On Job Creation
Mussa gave Bush the lowest mark, saying job creation has been weak. Goolsbee noted worker compensation is at the lowest it’s been in 40 years. Snyder pointed out the administration lacks policies to foster investment in the human capital needed to sustain our economy.

On Spending
Based on the length of time they’ve been in power, Snyder assigned responsibility for government waste to Bush and the Republicans. Mussa also criticized efforts to improve spending controls. Goolsbee citing the transportation and prescription drug legislation, called Bush the “biggest spender of all.”

Business Forecast
Many of the same topics covered in the Tribune evaluation are on the agenda of the GSB’s Business Forecast series. Both Snyder and Mussa are participants in this yearly look by GSB professors and alumni at global economic and political issues that will affect business and industry.

Original article: "Outlook 2006 on the Economy", December 25, 2006, Chicago Tribune.