Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Is Trump's Top Economist Writing Even More Fiction?

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Is Trump's Top Economist Writing Even More Fiction?

Article excerpt

The White House's tolerance for reasoned dissent being what it is, it's no surprise that Kevin Hassett, chairman of President Donald Trump's Council of Economic Advisers, took umbrage with the Tax Policy Center's analysis of his bloviating boss's tax "reform" plan.

Among other things, the center concluded that, based on the bare-bones proposal Mr. Trump has outlined to date, federal revenue could be reduced by as much as $7.8 trillion over the next decade. If tax increases included in the proposal or mentioned by Mr. Trump during his campaign were enacted, the 10-year cost would be reduced to a mere $3.5 trillion, the center concluded.

In an Oct. 5 speech at the center, Mr. Hassett, being the mild-mannered economist that he is, called his host's analysis "scientifically indefensible" and "based on many fictions."

That's some assessment of the center, which is a joint venture of the Urban Institute and Brookings Institution, and its personnel, who are experts in tax, budget and social policy and have served in senior government positions.

But Mr. Hassett's assertion regarding fiction at least had a ring of credibility to it, given his past writing.

Nearly two decades ago, when animal spirits ruled the stock market, Mr. Hassett took exception with the party poopers who insisted that Judgment Day was at hand. He co-authored "Dow 36,000" with James Glassman, a classic tome of financial fiction if there ever was one.

"Stock prices could double, triple or even quadruple tomorrow and still not be too high," Mr. Hassett and his co-conspirator wrote in a September 1999 piece for The Atlantic.

The duo accused analysts and media pundits of being wrong for warning that stocks were extremely risky. Experts aren't good at predicting what the market will do, he wrote, but "they are brilliant at scaring people."

And as for Federal Reserve Chairman Alan Greenspan's infamous warning about irrational exuberance three years earlier, Mr. Hassett and Mr. Glassman had this to say: "Many investors are rationally [their italics] exuberant. They have bid up the prices of stocks because stocks are a great deal. …

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