Bring Your Questions for Outgoing White House Economist Keith Hennessey

INSERT DESCRIPTIONKeith Hennessey

Keith Hennessey is the outgoing chief economic adviser to President Bush and director of the National Economic Council. When Obama takes office, Lawrence Summers will take his place.

“Our assumptions are that the economy will begin to recover early in the next president’s term,” Hennessey recently told CNBC, “but it’s too early to say exactly when.” (I can already hear the cynics among you: he’s just setting up his old boss as the real fixer and the new guy as the lucky inheritor.)

Hennessey held this job for just over a year; for the five years before that he was deputy director of the N.E.C. and spent the previous five years working for Trent Lott. He has also done governmental work in health economics and tax reform; early on, in the private sector, he worked on Symantec’s Q&A database program.

There are an awful lot of economic issues to consider these days — the estate tax and gas tax, the T.A.R.P. drawdown, oil prices — to say nothing of the broader recession and the stock-market miasma.

Feel free to ask Hennessey questions about all these subjects and more. I am guessing you will ask far more questions than he’s able to answer, but whatever the case, we will post his replies here in short order.

Addendum: Hennessey answers your questions here.


Bobby G

How much of a president's economic policy is influenced by external factors such as Congress, party pressures, etc.?

I suppose there are subsets to this question: how much of the highly publicized policy and how much quiet, everyday policy are influenced as such?

Levi Funk

My question:

"What does America have to do to have a budget surplus next year?"

hopefully that will make my headline prediction come true :)

Matt

In theory, the 'market' will correct itself after a sharp downturn in the economy much faster than if the government artifically props it up over a longer term. This artificial stimulation will inturn make a recession or depression last longer than if the 'market' were left to its own stimulants.

Question

Does the government take this into consideration? I believe the governments main reason for the artificial stimulation is to avoid mass chaos if the job market collapsed overnight. However, could we expect faster recovery otherwise?

Curious About Tax

What do you think of dramatically increasing the gas tax (say, maybe $2-3 a gallon), and to offset that increase with a reduction in income tax so that net taxes to the government stay the same. Do you think this is an appropriate way to manage the traffic and environmental issues caused by American drivers?

John

Why did Treasury not just allow the weak banks to fail and inject capital into the more stable banks to buy those assets?

Ben

What are some of the most absurd economic assumptions Washington politicians are guilty of making, and that you've had to 'advise' against in your position?

Mike M

On what economic merit does the government justify farm subsidies?

Why does ethanol warrant such heavy government support when all indications are that it is an inefficient fuel substitute? What explanations are given to justify the inflation of other food prices to make an inefficient fuel supplement?

Matias Rabio

A few questions:

Was there a conscious attempt by the Bush administration to pursue a weaker dollar to shrink the trade deficit?

Why is an economic downturn now viewed as enough of a crisis to increase deficit spending?

As the deficit continues to climb by unsustainable amounts, who will be lending the money to the government to maintain normal operating costs?

And just out of curiosity:

Did Bush express a fondness for any particular economists' theories?

Scott Supak

As someone who once, and presumably still, assumes that deregulation and tax cuts for the wealthy are good for the economy, why should we believe any of your current assumptions?

On a personal note, is anyone going to pay you to make assumptions in public, despite your dismal record doing so for the public?

BT

How much policy influence did you have?

Do you feel partly responsible for the country's economic crisis?

How do you assess Bush's knowledge of (and interest in) economics?

Why do presidents (Clinton and Bush, to be exact) change/rotate their chief economic advisors every 2-3 years?

Which think tank do you intend to hibernate in until 2016?

Witty Nickname

In every election I have experienced the winner campaigned on cutting waste (Bill Clinton: "Line by Line, Dime by Dime), to Bush and now Obama.

It does not seem to happen. Is this because politicians see merits of the programs and change their mind, or is it Congress forcing it down the President's throat?

Jerry in Chicago

Why doesn't the government open it's own bank, instead of allowing the Federal Reserve to contract on behalf of the American public?

Geoff

Do you feel like you look like Sean Astin: yes, no or maybe, and which was your favorite Lord of the Rings movie?

Jason M.

Have you ever read Freakonomics?

ChrisD

What are the job prospects like (in your opinion) for the outgoing chief economic adviser to President Bush and director of the National Economic Council?

iMac

Given that you've also worked for Senator Lott, how versed would you say the average Senator, Representative, White House staff is on macroeconomics?

Do you- or any other members of the White House staff- believe that our current income tax rates are at the optimal point on the Laffer curve?

Nick

Wow, it took until #9 for someone to ask an a*****e question. Me and my friends had set the over/under at 5. Congratulations Scott Supak on the profound pretentiousness of your post!

jon feldman

Why did the president try to have an economic stimulus package (the one in may) after his previous one (in 2003) was ineffective?

Also doesnt any kind of stimulus from the government run the risk of reducing peoples faith in both the government and the currency when they are les effective than politicians predict? If so, why are they seen as having very few negative effects?

To improve the economy, shouldnt the government work to help the sunrise (new, innovative) industries so they can grow more quickly and employ more people than sunset (old, ailing) industries like automobile which losing employment anyway?

KB

A few questions.

1) how many people work at the NEC?

2) how closely does the NEC work with other economic advisors or agencies such as Treasury, OMB, or CEA?

3) does the NEC create it's own economic models?

4) how often do you get to meet with the President?

5) what made you want to work on policy?

6) In the long run, how is America going to pay for TARP?

jblog

Larry Summers?

As in, "Chicks can't do math and science" -- THAT Larry Summers?