1.
Do you believe the American economy is in recession or
possibly worse?
It appears that the overall economy is teetering on the brink of a recession. It is still
a bit too early to say for certain. Remember, there is no direct measure of
recession. There are only indicators. Most economists agree that two or more
successive quarters of declining real GDP, decreasing real income, and increased
unemployment qualify as a recession. The current economic outlook is complicated
by several uncertainties. The most significant among these are the continued
repercussions of the subprime mortgage fiasco, the continuing spikes in the price of
crude oil, and the continued devaluation of the American dollar in international
money markets. If I could predict what will happen with these three variables, I
could say more definitively what will happen with GDP, real income, and
unemployment. Also, it is important to note that while a recession in the overall
economy may be inevitable, there will continue to be sectors of the economy that
will continue to perform well and there will be local economies that will be largely
insulated from the negative effects of a recession in the overall economy.
2.
Do you believe that President Bush’s Economic Stimulus
Package will be helpful? Why or why not?
The main feature of the package is the tax rebate that Americans will receive in May
or June. The effectiveness of the president’s plan depends on what people do with
the money when they receive it. The president hopes that you and I will go out and
immediately spend the money, stimulating demand in the overall economy. There is
some chance, I suppose, given mounting consumer debt, that a significant number
of people will not spend the money on consumer goods, rather they will use it to pay
debt. If they use it for the latter, there will be little or no stimulus effect. It is also
possible that people, being rational actors and having known that the rebate is
coming for several months, have already spent the money (borrowed against it) and
much of the spending increases that might have resulted from the plan have already
occurred. When these people actually receive their checks, they will simply use it to
pay for the spending they already have incurred. There is always a significant time
lag associated with these sorts of stimulus packages, so we will never be able to
definitively establish whether the president’s plan had the desired stimulatory effect
or whether other variables had a stimulatory effect. Political leaders will make
contradictory claims about the relative effects of the plan.
3.
What do you see as the three most important concerns that this
country faces as we move toward the next presidential election?
the economy
the war in Iraq
the erosion of liberties (both civil liberties and economic liberties or property rights)
4.
Who do you believe has the best potential to address these
concerns as president?
The real test of presidential leadership lies in the ability to build consensus. We do
not appear to be in a period in which significant and compelling consensus on major
issues is feasible. Historically, this sort of consensus occurs during periods of
significant national stress. Thus, presidents who have demonstrated the most talent
at building consensus (i.e., Franklin Roosevelt, Lyndon Johnson) were confronted
with compelling national challenges, making the task of building consensus on
national policy possible (i.e., the Great Depression, the Civil Rights movement).
While pundits discuss the current issues as if they are crises, by comparison, they
are not. Thus, the political incentives remain present to pursue incremental
solutions. Incrementalism of this sort leaves the impression that the political system
is gridlocked or stalemated, reinforcing the perception that our problems are
intractable at best and dire at worst.
I have no faith in individual leaders to solve the issues I outlined in #3, or any other
problems. The founders of our system of government created institutional
arrangements that are designed to frustrate strong, assertive leadership. They
wanted to make it difficult for government to act unless significant consensus could
be established across several institutions (House of Representatives, the Senate, and
the president) that a given course of action was appropriate. Americans say they
want political leaders to put politics aside and “do what’s right for the country.” Our
founders were not so naïve. An argument could be made that when our political
leaders are unable to come to agreement on national policy in a quick and efficient
manner with limited debate, the system is working precisely the way the founders
intended. It might also be taken as an indication that the problems with which we
are currently confronted are not nearly as serious as political leaders would have us
believe. A politician has an incentive when campaigning to convince voters that our
current problems are potential crises and that he or she is the only candidate with
the credentials to save us.
5.
If you could meet with one of the presidential candidates today
and speak with them personally, what would you like them to
know?
Liberty is America’s transcendent value – it trumps everything, including security,
misguided notions about fairness and equality, democratic decision-making.
6.
If you could meet with President Bush and talk with him
personally, what would you like him to say?
At this juncture, any discussion of policy would be pointless, so probably, I would
just want to get his thoughts on the new Major League baseball season.
7.
Regardless of your personal preference, who do you believe
will be the next president of the United States and why do you feel
that it will be this individual?
I do not “feel” about such matters. Neither would I venture a guess. Anyone who
would make a prediction at this point would be, in fact, simply guessing. Those who
guessed right would claim that they had some special insight; those who guessed
wrong would either never admit they made the prediction or they would qualify their
prediction by delineating the factors that they claim confounded their prediction.