Professor criticizes McMahon’s jobs plan
Published: Tuesday, September 4, 2012
Updated: Tuesday, September 4, 2012 22:09
A UConn professor and the director of UConn’s economic analysis center spoke out regarding a U.S. Senate candidate’s jobs plan in an interview Friday.
Professor Fred Carstensen criticized Linda McMahon’s plan, which calls for a balanced budget amendment, tax cuts for the middle class and a decrease in government spending.
“People like tax cuts. People like also to be told that you’re going to improve the training programs that are available to people so that they’re more competitive in the workplace,” Carstensen said.
He approved of the proposal to improve training programs, but called the idea of a balanced budget amendment “totally irresponsible” because no household balances its budget. Rather, most households borrow money in order to pay for a house or for a higher education, Carstensen said.
“A balanced budget amendment is idiotic, it is irresponsible. No household, no business balances their budget in the way in which she’s talking about,” he said.
Carstensen also questioned McMahon’s proposal to cut taxes. Her proposal to cut government revenue “very dramatically” but only cut government expenditures slightly, at one percent per year, will ultimately run a huge deficit, Carstensen explained.
Regarding McMahon’s proposal to cut government waste, Carstensen said, “Waste is still somebody’s income. In making those cuts you’re still taking money away from somebody.”
If McMahon could find duplicative government programs and eliminate some in an attempt to reduce government spending then “at the end of the day you’re able to save, what, three, four percent of the federal budget?” Carstensen said.
The professor went on to explain that McMahon’s proposed tax cuts may not be a good idea.
He noted that the Bush tax cuts in 2001 and 2003 were followed by the lowest level of business investments in America since WWII. In fact, those tax cuts benefitted other countries but not the United States, he said, causing the United States to become increasingly dependent on imports for consumer goods.
“Massive cuts to household income might be beneficial to the world economy. It’s not clear that it’s beneficial for the American economy,” he said.
Carstensen said he would like to see a narrative from McMahon explaining how her proposals would translate into American jobs.
“Her items look like they simply were picked off of a menu of politically attractive items. She offers no systematic economic analysis of how the proposals will actually work out,” he said.