Austan Goolsbee on Austan Goolsbee

Austan Goolsbee

Want to know a bit more about Austan Gooslbee, the newly appointed chairman of the White House Council of Economic Advisers?
Straight from the horse’s mouth, here’s a Q&A we ran with him in July 2009. There are a lot of interesting answers, including several that are perhaps more interesting now than they were then. Highlights:

The Obama administration has tightened its control of the domestic financial industry, the domestic automobile industry, the tobacco industry, and is gearing up to do the same with the healthcare industry. Why do you and the president believe that centralized control of the economy will be productive? What makes the administration think that it will be any better at it than every other country that has done this? – DaveyNC

Whoa, Davey. The president and the administration firmly believe in the importance of a well-functioning private sector. We are dealing with these historic messes because they were the messes that were on fire when we got here. We are not “tightening our control” of these industries in order to convert them to centralized socialism, impose mind-control, or any other such thing. Our first task was to prevent the worst financial crisis and worst recession since the depression from becoming the next Great Depression. I am from the University of Chicago. You are not going to find anybody more opposed to socialism or corporate welfare than me. But truly, do you really think that stronger oversight of financial markets is anti-business? The loss of public trust in financial institutions undermined the market system and created the biggest crisis in 75 years.
And:

Do you think raising taxes on the wealthiest taxpayers can stifle economic growth? Why or why not? – Chris Lawnsby

In the abstract? If tax rates are too high, yes. But as you probably know, the United States has experienced rapid growth even in periods where the top marginal rate was much higher than it is today and growth has been measly over the last eight years despite major cuts in the top rates. So at the least, tax rates on the wealthiest Americans in the country are not the primary thing driving growth. In Obama’s budget specifically, the top rates would go back to where they were in the 1990’s (when growth was quite respectable); it would invest in education and the health system and cut taxes for 95 percent of workers in the country. I don’t see that stifling growth at all.
And:

Would you consider yourself a follower of the Friedman/Stigler/Coase/Miller school of economics and finance, or a follower of Keynes and Tobin? – Jeff Carter

I am more of a data-dog, empirical economist, so I don’t know how that fits in to your schema. The old days of the ideological battles between Chicago and the Keynesians is not really the way things are anymore. I would like to think I took some important things from both camps, though. Tobin was a dear friend and mentor to me when I was a young man and helped get me into economics. I never knew Friedman or Stigler, but Becker, Miller, Heckman, Murphy, and other giants at Chicago and the culture of debate and discovery they helped create there are certainly in my bloodstream. It is a magical place. But basically I just go where the data say to go.
Meanwhile, here’s what Goolsbee had to say yesterday on the Sunday news programs about unemployment (“I don’t anticipate it coming down rapidly”), extending the Bush tax cuts (he’s opposed, both economically and politically), and one big reason for the slow U.S. recovery (the continuing European financial crisis).