The New York Times editorial board on Saturday published an article claiming Republican lawmakers’ love of pro-austerity policies has inhibited economic growth.
On the other hand, the op-ed argues, the Obama administration is “doing better” by “adding new taxes and investments”:
Republicans have insisted on austerity for ideological and political reasons. The administration has done better by adding new taxes and investments to the cuts, but the reductions are still deep and damaging.
CNBC’s Joe Kernan and Harvard Business School professor Robert Kaplan were not impressed with article’s reasoning, saying on Monday that its authors are either willfully dishonest or simply ignorant of economic principles.
The part about adding new taxes “was dishonest or the people writing it don’t understand economics,” said Kernan.
“Now, I have gone in and looked at the New York Times editorial board,” he added. “I found one person that does have an economics degree, Terry Tang. [...] Anyway, we have a Harvard professor. And I talked to you a little bit. But how do you characterize that statement?”
“I don’t understand it. They might want to rewrite that sentence,” said Kaplan.
The Harvard Business School professor continued, explaining that the Federal Reserve’s artificially low interest rates have shielded us from feeling the full effects of the national debt.
“My fear is this,” he said. “This deficit doesn’t feel that bad and this amount of debt doesn’t feel that bad because interest rates are so low.”
“Imagine if we had, quote, unquote normal interest rates, 5 percent, 6 percent, 10-year, we would be taking much tougher action [on the national debt],” he added. “And we shouldn’t wait for that.”
(H/T: Washington Free Beacon). Featured Getty Images.