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Saturday, December 03, 2005

Clueless on the National Debt

Daniel Gross wonders if Bush's top economic adviser Allan Hubbard is just acting ignorant, or really is ignorant about the size of the national debt. His guess is that Hubbard doesn't have a clue:

Daniel Gross: Debt Be Not Proud: This is scary. Allan Hubbard, President Bush's top economic adviser, professes not to know the size of the national debt. From yesterday's White House press briefing.

Q Al, can I ask you one? I can't remember the last time the President spoke about the national debt, which is now over $8 trillion. Is that something you guys worry about?

DIRECTOR HUBBARD: Well, I don't know where your $8 trillion comes from, but we --

Q The public website.

DIRECTOR HUBBARD: Well, I guess it really depends on what you're including, but let me -- again, the President is most concerned about the economy and the budget. And a key component of that, as I have spoken earlier, is the budget deficit. And, you know, that's what contributes to the overall budget debt, the country's debt, and that's why it's so important to reduce the budget deficit and, hopefully, ultimately, eliminate the budget deficit.

Q Does the magnitude of the national debt disturb you?

DIRECTOR HUBBARD: Actually, again, I don't know what numbers you're using, but the current budget debt is not a problem, but we do not want it to grow as a percentage of the GDP. That's the way you want to look at it, is the debt as a percentage of GDP. And our budget debt is lower than many other developed countries. The President is committed to keeping it low; that's why he wants to cut the budget deficit in half by 2009. . . . .

Q Check the Bureau of Public Debt website, you'll see the number there.

DIRECTOR HUBBARD: Okay, thank you.

Is the ignorance here calculating -- i.e. Hubbard really knows what the national debt is but acts like he doesn't because it's embarrassing to talk about? Or is it genuine -- i.e. Hubbard really doesn't have any clue what the national debt is? (I vote for the latter.) In case, he's still looking, the link is right here. And the debt is actually now more than $8.1 trillion. Given that the debt limit is $8.184 trillion, we're only a few weeks from crashing through the limit yet again. Merry Christmas!

The choice of which programs to eliminate and to keep trying to reduce taxes appears to be driven by mostly ideological considerations, so it's not surprising to find confusion of this sort. [Update: Brad DeLong votes with Gross.]

    Posted by on Saturday, December 3, 2005 at 02:50 PM in Budget Deficit, Economics | Permalink  TrackBack (0)  Comments (7)


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