I'll be answering questions for the next few hours.

Verification: http://robertreich.org/post/9711442447 / http://twitter.com/rbreich

EDIT (4:15pm): Thanks so much for your thoughtful questions. I'm going to take a break for now, but I'll be back tonight to answer some more.

Comments: 2319 • Responses: 47  • Date: 

absinthe718613 karma

If you could eliminate a single federal regulation and replace it with some other regulation (or nothing at all), what would it be and why?

robertbreich1573 karma

I'd start by legalizing marijuana.

sonnuvabitch1059 karma

Mr. Reich knows his Reddit audience.

robertbreich1360 karma

My son, Sam, tells me this will be big with "trees" (whatever that means).

patefacio238 karma

How is Clinton on a personal level? He looks like he'd be a great guy to have a beer with.

Would you recommend trying to get into a career in politics? It's definitely something I'm interested in.

robertbreich1103 karma

I've known him since he was 22. At Oxford, as grad students, we didn't inhale together.

bluehat9237 karma

Add it up: (1) 25 mil Ams need full-time work. (2) Am's infrastructure falling apart. (3) Ten-year T-bill at 2%. Borrow to rebuild America!

-This was recently posted on your twitter. In your mind, is borrowing the best (or only) way back to economic strength for the US economy?

-Do you think the deleveraging of the economy is a necessary evil? Do you think that historical GDP (pre 2008) was unsustainable? Do you think GDP is even something we should be looking at to measure the strength of our economy? It seems to me that basing success on GDP encourages inefficiencies in the economy. Do you agree?

Thank you. I wish there were more prominent economists willing to have dialog with us plebes.

robertbreich404 karma

The GDP isn't the best measure. I'd look at jobs and wages. In August, the U.S. economy created zero new jobs, and hourly wages continued to drop. We can't possibly get back to a strong economy at this rate.

As to "deleveraging" -- I don't think it's a necessary evil. Wringing all the debt out of the economy, including personal debt, would mean huge pain for tens of millions of people. It's what Hoover's Secretary of the Treasury, Andrew Mellon, recommended in 1930 when he said "liquidate labor, liquidate stocks, liquidate the farmer, liquidate real estate ... purge the rottenness out of the system." It's like trying to cure the patient by killing him.

rickray325218 karma

If you were president, what would be your first action to create jobs?

robertbreich737 karma

I'd revive the Depression-era Works Progress Administration and Civilian Conservation Corp, to hire the long-term unemployed -- put them to work rebuilding our crumbling highways, ports, bridges, school buildings, parks, playgrounds.

wangofchung218 karma

What is the single most important piece of advice you would give young voters (18-25 demographic)? What is the best way for us to educate ourselves on the important issues like public policy and the economy?

robertbreich762 karma

My strong advice: Try to avoid cynicism about politics, government, and all the major institutions of our democracy. (That may be hard at a time like this, but if you're cynical at your age, you'll be wasted by the time you're mine.) Best way to educate yourselves is to read my books (my books are the kind of books that once you put them down you can't pick them up), read the NYT every day, and read the Wall Street Journal's editorial and oped pages so you learn the opposite of what's truthful.

wangofchung154 karma

Thank you for your response! Can you offer a book or author who you believe offers a counterpoint to your books? It would be nice to contrast your opinions and insights with someone on the other side.

robertbreich534 karma

Almost anything by Milton Friedman. He's rigorous and intellectually honest, and comes out at a very different place from me -- mainly because we start from different premises about human nature and the meaning of a good society.

evasilev178 karma

What is the top priority policy change you would like to see outlined in Obama's upcoming policy speech to Congress?

robertbreich438 karma

It will be a hard sell, but when consumers (whose spending is 70 percent of the economy) won't spend, and businesses (who are facing lackluster sales) won't hire, government has to be the spender of last resort. The President should ask for a trillion dollars to boost the economy. Not just on the WPA and CCC I mentioned, also infrastructure investment, also loans to cash-starved states and localities. With 25 million Americans looking for full-time work, and the cost of borrowing so incredibly low (T-bills at 2 percent), this is the only responsible thing to do.

Rx_MoreCowbell157 karma

Thanks for the link form your blog. As someone who has spent many years in govt and understands the difficulty of pushing policy through I was wondering what you would do about finance reform? Its one thing to say that we need a return to to Glass-Steagall type regulations and stronger oversight over derivatives and other "weapons of financial destruction" but its another to put into action.

How would you deal with regulatory capture and investment banks financing political campaigns and Republicans refusal to even allow the nomination of the head of the Consumer Financial Protection Bureau? Are there even answers to the problems we have or have we evolved a political system too far gone that only serve special interests?

Also, loved you in your role as Det. Former Secretary of Labor Robert Reich.

robertbreich417 karma

We can't get true financial reform until we constrain Wall Street's vast reservoir of money from corrupting our democracy. In fact, we can't get much reform anywhere -- health care, energy, defense, etc. -- without limiting the effects of big money in politics. (That's why I agreed to become chair of an organization called "Common Cause," a citizen's group dedicated to getting money out of politics.)

hardigree153 karma

  1. Do you think the underlying philosophy behind Krugrman's assertion that creating a fake alien invasion so we'd pump a trillion into the economy has some merits?

  2. Will Detective Secretary of Labor Robert Reich and Detective Conan O'Brien make a sequel?

robertbreich587 karma

I think we already have an alien invasion from space. It's being led by Michele Bachmann.

I'd love to make a sequel with Conan. Write to him and let him know.

wackyguy15139 karma

Has Obama tried to contact and get advice from more progressive economists like yourself and Krugman, or has he stuck with the more center-left economic minds on his cabinet and staff?

robertbreich304 karma

Krugman and I met with him last January. Joe Stiglitz was also at that meeting. Haven't heard from the President since then.

RedditHardcore113 karma

I imagine that you are very proud of your son Sam's success with CH given your participation in some sketches. Has his career arc and/or success surprised you? Any favorite stories of him as a youngster?

robertbreich446 karma

Sam (who's brilliant, by the way) has single-handedly ushered his old dad into the digital world. Without him, I wouldn't be here on this site today. Without me, he wouldn't be in the world. Fair trade.

Matticus_Rex107 karma

What's your take on the Austrian school of economic thought? Would you be interested in debating one of its economists, maybe with the proceeds going to charity? (Dr. Karl Smith of UNC is debating Dr. Robert Murphy of the Ludwig von Mises Institute, that's what brought it to mind)

robertbreich254 karma

I'll debate anyone who's intellectually honest.

pfibiger104 karma

Twenty years ago Mitch McConnell called for the rich to "pay their fair share" in a campaign ad. What has really changed (not for McConnell, but for American politics?) Is this about cronyism and the rich controlling political purse strings, is it fed by voters' misguided sense of their own upward mobility (I don't want them taking my money from me, when I make my millions), or is there something else at work?

robertbreich235 karma

I fear it's mostly due to the greater and greater political potency of the very rich. Their money is now flooding politics. Blame the Supreme Court's grotesque "Citizens United v. FEC" decision, combined with lax enforcement of election laws.

eddylee7189 karma

Do you believe that the attack on the education system is more of an attempt to push towards the privatization of the system in order to control the education of future generations and further create the gap between the have's and the have not's? I am not a conspiracy theorists, but it just seems that the push towards private education prevents lower class (left) from acquiring education and further allows the upper (right) to further control the poor. English class system of nobles and serfs.

robertbreich156 karma

I've proposed vouchers whose worth is inversely proportionate to family income (so a poor family gets a very large voucher, say $15K, while a rich one gets a much smaller one, say $3K.) I'd be interested in your thoughts about this.

exodus2883 karma

Who do you foresee winning the Republican nomination? Separately, who do you least-fear winning?

robertbreich326 karma

Rick Perry looks the part -- great hair, good looks. And even though I think he's nuts, he comes off as a fighter. People are so desperate these days they'll go with almost anyone who seems like a fighter. At this point my betting is on him. And if he becomes President I'm heading to Australia.

jfr35977 karma

I remember your saying that one of the problems with the last stimulus package was that it wasn't big enough. I'm assuming you favor a bigger package this time around -- is that correct? And will a stimulus combined with increased taxes on the wealthy be enough, or will we need something additional like a value-added tax?

robertbreich211 karma

Yes. And, yes, I'd increase marginal taxes on the wealthy -- not only to help bring down the long-term debt and deficit but also to restore some balance to our society. It can't be healthy when CEOs are takiing home 300 times what average workers are taking home (40 years ago it was closer to 30 times).

VizualAid75 karma

Mr. Reich, why hasn´t their been any change to the way the United States functions as a whole? I´m sure even when you were Sec. of Labor you heard the complaints of the people/public. How often do people in power actually act upon the demands of the people/public rather of the powerful? Thank you.

robertbreich250 karma

I don't remember a time when the economy was so awful, politics were so paralyzed, and Republicans were so bizarrely ideological. Perfect storm.

willytheshake70 karma

Mr. Reich - It seems every day President Obama is giving up some sort of ground to House Republicans and strong lobbies at the expense of the middle class, poor, and (today) the environment. Is this merely his Australian retreat (a la MacArthur), or is this something that's going to continue on into the election year, posing serious problems for progressives.

robertbreich190 karma

If he doesn't start showing more backbone, and more clearly explaining to Americans why he's right and why his opponents are wrong, he won't be re-elected.

A1batross69 karma

Would states be well advised to follow North Dakota's example and set up individual state banks? What would be the costs and benefits (broadly speaking)?

robertbreich147 karma

Makes sense to set up public banks that have a special interest in a state or region -- and whose lending and investment decisions therefore create synergies regionally. But those loans and investment decisions have to be walled off from politics.

catamorphism65 karma

Mr. Reich: I really liked something you said a month ago on Twitter: "If you respond to what's happened in DC with more cynicism and apathy, the radical right wins completely. Instead: Organize and mobilize!" I'm trying to figure out how to live this out. I'm 30, and halfway towards a Ph.D in computer science. I love the work, but I don't love that most people in my field don't care about politics (or they say they don't, but what they really mean is that they're happy with what the system is doing for them as a privileged white guy, and don't feel they need to change anything) and don't want to use their skills for anything more than increasing the number of clickthroughs on some Web ad. I'm also a pretty disorganized person, so volunteering for something in my spare time probably won't cut it -- I'm too tired in my spare time. I feel like if I'm going to organize for change, it has to be my full-time job.

The problem is, I don't know how; all of my connections are in a field that I'm not particularly inspired to keep working in. I also don't know what; I'm not independently wealthy, so if I'm changing the world, I have to be employed while I'm doing it. So, what would you recommend to a 30-year-old with a liberal arts bachelor's degree and an engineering master's degree (the latter from Berkeley, by the by, and the libertarians in my department were just the beginning of my disenchantment with my academic field) who has no dependents, nothing tying him down to one particular location, who is more or less completely free to do anything, and who wants to do something with his life that will ameliorate social inequality? I'm really hoping the answer isn't law school.

robertbreich99 karma

The answer isn't law school (unless you love the law). I'd recommend you get involved with a political campaign -- local, state, or national, or even a ballot initiative -- between now and Election Day. It's the best way to understand politics from the ground up, find out where your skills and enthusiasms lie, how much time and energy you really want to devote. Obviously, it should be a campaign you believe in.

stevencurtis60 karma

Greetings Robert,

I use your books in most of the 11 different courses I have been known to teach in Sociology. My students often ask the following, and I defend your positions for argument, but need clarification:

A) In the past you've noted the shift in demand for labor in the US from "Routine Production" to "Information" and "Symbolic Analysis."

1)  Where should investment in the US now go?       
2)   How should we be investing in 
      Symbolic Analysis and continue to retrain the 
      workforce for a global information economy?  

B) Is routine production dead? Is "Routine Production Service" job creation undesirable in our current dire economic situation?

C) Would creating manufacturing jobs be useful for the nation? Construction work, road and bridge repair and building etc. would be a limited number of jobs and require public funding, not privately offered in this economy.

robertbreich49 karma

A) US (and global) investors continue to move into high-tech (when they're not buying gold). Corporate profits are huge, almost across the board. But wages keep declining. The ratio of profits to wages hasn't been this high since before the Great Depression. Part of the answer is education: From early childhood through college, we've got to be training more of our people how to identify and solve problems, work creatively and constructively in teams, see patterns and integrate different disciplines and ways of thinking.

B) Routine production isn't dead but it's on life support. That includes routine services. All continue to be outsourced abroad or automated and digitized here.

C) Assembly-line routine manufacturing jobs won't come back. Even if what remains of manufacturing remains and grows, more and more of it will be done by numerically-controlled machine tools and robots.

LivinTheDreamBro57 karma

You recently released a video showing how the extremely wealthy need to pay more taxes.

-What sort of backlash, if any, have you faced for that?

-How did you come up with the concept for the video? How did you find a production team that fit with your vision?

robertbreich154 karma

Not much backlash except for the usual harrumphing from the Right. A young producer/director named Jake Kornbluth has been working with me for about a year now on short videos that try to explain complex subjects in ways people can easily "get." I wanted to do one that connects the dots and explains what's wrong with the economy. I thought drawing some cartoons would be helpful. Jake came up with the idea of showing me drawing at high speed. By the way, here's the video: http://www.youtube.com/watch?v=JTzMqm2TwgE

jackelfrink56 karma

Something tells me I may regret asking this but .....

Several conspiracy theories state that all major governments are secretly controlled by a sect of lizard people from outer space who disguise themselves as human. It is also claimed that if you ever ask one of the lizard people about this, they are biologically incapable of lying so they have to give a non-answer style answer.

Yeah. Bonkers I know. That's how conspiracy theories go. But earlier this year Donald Rumsfeld was asked if he was one of the lizard people and he refused to answer the question.

So could you please put the conspiracy theories to rest once and for all? Can you clearly and unambiguously state for the record that you are not one of the lizard people from outer space?

robertbreich116 karma

I'm a little short for a lizard person.

emamousette53 karma

Mr. Reich, what's your take on the European Union? Will it be around in the same form in 5, 10, or 20 years?

robertbreich105 karma

It will still be around. The real question is whether in a few years it's issuing "euro-bonds" -- that is, taking on debt as a whole -- or whether each member state begins to go its own way with regard to fiscal and monetary policy. A lot depends on the PIIGS (Portugal, Ireland, Italy, Greece, Spain) and how they get out of their debt crises, and also on Germany, and whether Germany steps up to the plate and leads the way.

jpage196952 karma

Dr. Reich, would you ever consider running for the Senate? The U.S. could use someone like you in the Senate fighting for the middle class.

robertbreich105 karma


awaterma51 karma

What's your view on computer pre-trading? By this, I mean the practice of computers analyzing orders BEFORE EXECUTION and then building strategies to react to these private market changes. What could/should the SEC be doing in regards to this practice?

robertbreich111 karma

It's adding to the instability of the stock market.

coooolbeans48 karma

What is your take on the NLRB and Boeing controversy?

robertbreich74 karma

My understanding is the General Counsel of the NLRB (a career official) determined that Boeing's move was motivated by a desire to do an end-run around its labor unions, and intimidate its workers from further union organizing, in direct violation of the National Labor Relations Act. I don't know whether he's correct. I don't think the Board hasn't ruled on the decision yet, and if they agree with him it will almost surely be appealed to the federal courts. It's provided lots of grist for Fox News and the editorial pages of the Wall Street Journal.

thrillmatic48 karma

Thank you for doing this, sincerely. I hope Redditors will take advantage of this opportunity, regardless of how they feel politically. I have a few questions, if you wouldn't mind answering them:

Since 2008, the libertarian movement has inspired many young Americans who are disenfranchised by a tough economy and demoralized by the dual-party system to seek an alternate route in their political ideology. They're a crowd of socially liberal, anti-war (drug and terror), anti-government infringement "rebels" who believe in little government oversight in the discourse of business. As a progressive, I'm petrified by that thought: it's wholly idealistic, and even the most elementary of hypothetical examples yield some terrifying outcomes for those of whom that are not conditioned to being big entrepreneurs or have rich parents who give them good education (we see it partially manifested now, Ron Paul calling for ending FEMA, after it devastated Northern NJ, where I'm from; the repeal of Glass-Steagall under Clinton and it being conveniently omitted from any serious discussion about what's going on). Moreover, it showcases a terrible lack of knowledge on innovative development in the United States - they've dominated the narrative to suggest that government hampers innovation when in reality, it was the Military-Industrial Complex which has effectively created most of the major inventions (or contributed to them significantly) which our private sector utilizes today (not that I like the Military-Industrial Complex). Broadly, I'd like to know what you think of the philosophy AND the movement itself. Is it reasonable? What would it yield if applied today (i.e., if Paul becomes president)?

Secondly, a Goldman Sachs memo was leaked yesterday to the WSJ, which suggested that the European banks are going to need a $1tn "bailout" to ensure that bonds are issued and liquidity is available.

1) Do you think the Goldman assessment is accurate? 2) Assume it is. What happens if the United States doesn't bail out European banks?

robertbreich219 karma

We're evolving to the point where the middle class and the poor live by libertarianism (that is, "you're on your own") while the rich, the biggest Wall Street banks, and the biggest corporations live by socialism (that is, everyone else bears their downside risks). Seems wrong, somehow.

9volt47 karma

Huge fan Robert! I wish you were still Secretary of Labor.

I think one thing that everyone seems to be missing is the role that automation is playing in the re-shaping of the workforce. The incredible productivity gains that industrialized countries have experienced in the last 20-30 years seem, to me, to be almost entirely the result of automation and advancement of technology. The first round of automation was largely blue collar... replacing welders and such. This time, it's going white collar. And it seems to be accelerating.

Building a website used to cost at least $5,000 & require deep skill. People can now throw the same thing up, by themselves in a weekend. The Navy is looking to bring on a fully-automated bomber (X-47B). Google is in the midst of testing their "driverless cars" in Nevada. Foxconn (Chinese makers of all things iApple) announced they want to automate 1 million jobs within a year. Robots comprise 2% of deployed "soldier" count in Iraq... the list goes on and on and on.

And a downward economy just accelerates things. The worse the economy gets, the more companies want to squeeze costs, letting people go, making economy worse, rinse, repeat.

And if an industry or a product goes automated, it doesn't just affect that single job. For instance, when (not if) we do start getting driverless cars, they should crash less, right? Then we'll need fewer police, insurance agents, auto body repair shops, etc.

I'm of the belief that we just don't need that many people to work any more. And that trend will only accelerate. The old capitalist equation of "I have to work or my life sucks/I may die" seems to be breaking down.

Instead of trying to embrace this and build a utopia where we can somehow automate away the need for humans to be the cogs in a machine, we all seem intent on fighting to "get our jobs back".

Two questions: 1) How come no one (including yourself) is talking about this as the core cause of our high unemployment? 2) Is any agency in the government looking at this and trying to plan appropriately?

robertbreich51 karma

There's no finite limit to human needs, nor to the ingenuity of the human mind to satisfy them. By this I mean that if properly organized, an economy and society can always provide enough work for anyone wanting it, as well as enough leisure. The challenge is to become properly organized -- politically and economically. The move from farm to factory occurred in part because of a huge increase in farm productivity; the move from factory to office was due to huge improvements in factory productivity (including automated technologies). Now that offices are becoming far more productive, the next move will be from office to personal services.

rotophonic42 karma

Have you considered how the usurious credit card companies are currently impacting the economy?

Many credit card companies, prior to the implementation of Dodd/Frank (which outlawed many, but not all, CC bad practices) had systematically trapped existing credit card holders into accounts with rates at near 29% rates and basically have refused to lower the rates, even when consumers make payments on-time for years. I hear lots of concerns about consumer demand, homeowners but rarely hear about those of us unlucky consumers. This is definitely sucking money out of my consumer spending.

What can be done? How is it legal to charge 29% interest when these banks can borrow at 0%? What happened to usury laws?

robertbreich54 karma

The real scandal is that so much credit-card company abuse continues even after Dodd-Frank. Credit card companies have sent platoons of lawyers and lobbyists to Washington to slow down or reverse any rule or regulation that could reduce their profits.

nothingshortof41 karma

What's your opinion on steady-state economics, getting away from this (in my opinion) near-sighted hammering on the need for growth growth growth in a world that, in the end, is finite?

If you're in favour, any thoughts on how to work towards growthless prosperity?

robertbreich112 karma

"Growth" doesn't necessarily mean more "stuff." It also means -- if a nation chooses it -- a cleaner environment, better health care, higher-quality education, more support for the arts, fewer people in poverty, and so on.

[deleted]39 karma

  1. Who would win in a fist fight between you and David Frum
  2. Summary of your personal investment style?
  3. Three books we should read to understand modern economics

robertbreich104 karma

  1. Probably Frum. He's bigger.
  2. Buy high, sell low.
  3. "Aftershock: The Next Economy and America's Future," "Supercapitalism," and "The Work of Nations." (I wrote all three.)

Therustygear38 karma

Mr. Reich I am a HUGE fan of your work and have been ever since I wrote my 10 page over your book Aftershock.

Here's my question: As you've stated numerous times in the past, now is not the time to eliminate spending by the federal government. In Aftershock you outline a number of things that the federal government should invest in in order to create jobs and stimulate spending by the middle class. If the President get's the budget for a single big project, what project would benefit our economy the most? Reworking roads, high speed rail, an ambitious large federal program, or something else?

Thanks so much for the AMA.

robertbreich73 karma

Three criterion: It should be large enough to address the shortfall in aggregate demand. It should focus on investments (infrastructure, basic R&D, education) that will make the nation more productive in the future. And it should be as labor-intensive -- creating as many jobs -- as possible

gentofleisure38 karma

What do you think of Reinhart and Rogoff's assertion that once sovereign nations hit 90% Debt to GDP ratio that "something happens" and they tend to fail?

robertbreich96 karma

It's ahistoric. In 1946, the debt/GDP ratio for the United States was 130 percent. We didn't fail. In fact, for the next fifteen years we grew faster than we've grown since.

kilgore226437 karma

When President Obama backs down on his jobs plan do you see a Democratic presidential challenger entering the fray? If so, whom?

robertbreich119 karma

No, I don't. The real challenge for Democrats/Progressives/anyone concerned about the future of the country is to become better organized and mobilized, more politically active, and thereby nudge Obama toward where he ought to be. I've had enough years in Washington to know that few decisions truly in the public interest occur there unless people outside Washington demand them.

egodeath9237 karma

With 9.1% unemployment, now zero job growth, .7% GDP growth in 2011, and little to no chance of getting spending increases through a republican house, do you see any chance of the president getting re-elected barring a major political shift?

robertbreich74 karma

He could be re-elected if the economy appears to be improving -- even if it's still awful.

MarkNotMarc34 karma

First thanks for taking the time to answer some questions. I enjoy your commentary on NPR.

In Hindsight, was NAFTA good for the US? It seems to have hastened the migration of good manufacturing jobs out of the country. The knowledge and technology required to build things seems gone for good— along with the jobs. Your thoughts?

robertbreich78 karma

In hindsight, NAFTA didn't have much effect one way or the other. Its opponents feared it would suck American manufacturing to Mexico, but American manufacturing went to China. Its proponents hoped it would generate more export jobs in the U.S. It didn't. Its biggest consequence was to contain Mexico's peso crisis.

r35pawn29 karma

Thanks for doing this!

I was wondering about the payroll tax - more precisely, why does it still exist?

It seems as though it discourages hiring by increasing the marginal cost of workers and it also disproportionately costs poorer workers more money. I can't think of a worse way to raise government revenue in a recession.

Do you think that a carbon tax, VAT, or some other tax regime would be better?

robertbreich53 karma

Payroll tax is mildly regressive, and for years the surpluses in the Social Security trust fund have been used to pay for everything else government does. So, yes, ideally we'd replace it and rely on one overall progressive tax system -- with more brackets at the top. But very hard to get there from here.

theTown0026 karma

Firstly, thank you for doing an IAmA. This is the whole reason this subreddit exists!

Questions: What do you think about everything Obama has done thus far? What do you think will happen if he gets re-elected? I read your blog post about the debt deal, was there any way to come out of that on top given how stubborn some conservative congressmen were?

Its really an honor to have you on here!!!

robertbreich62 karma

The President has a first-class temperament and a first-class mind. But I haven't seen enough fight in him. No president in modern history has had to face such a terrible economy and such an ideologically intransigent and united Republican party. He has to stand up to them and mobilize the public around a plan to restore jobs and growth.

beable26 karma

A smaller question perhaps - but what's the actual day-to-day job of a Secretary of Labor? Is it researching or proposing or lobbying or some combination of them?

robertbreich39 karma

I obviously can't speak for all labor secretaries. I spent about a quarter of my time in the White House, working with President Clinton and his assistants on jobs and the economy; another quarter on Capitol Hill, working with members of Congress on the same issues; another quarter in the Department itself, working with assistant secretaries on pension protection, job training, wage and hour enforcement, workplace safety and other related issues. The rest of the time I was out in the country, gathering information and talking to real working people.

QuestionForYou222 karma

It seems to me that if we tax the super rich (1+ million/year) and use that money for stimulus (meaning the gov't ends up funding jobs to put that back into the pockets of the average joe) then the average joe ends up having more money, is happy, can pay the mortgage and ends up spending more money which ultimately ends back up in the pockets of the super rich.

Is this an accurate description of the monetary cycle or too much of an oversimplification? If it's basically accurate then why can't this simple message get out so that the average joe is happy and the super rich stay super rich?

robertbreich34 karma

A simplification, yes, but you've got the essential idea. Once the economy begins growing again and we start adding middle-class jobs, more of the middle class pays taxes -- enabling us to further lower the deficit. We thereby go from a vicious cycle to a virtuous one.

Postpawl22 karma

What is your favorite economics book?

robertbreich52 karma

"The Affluent Society," by John Kenneth Galbraith. Published long ago, but as relevant as ever.

uplift1721 karma

What do you think has been the biggest policy mistake of the past 3 years?

robertbreich77 karma

The White House announcing that the stimulus package would lower the rate of unemployment to 8 percent.

evomatic0113 karma

I just wanted to say I really enjoy your appearances and discussions on Kudlow. I was wondering if you could talk about your personal investment strategies. Where do you recommend your son invest his money or plan for retirement?

robertbreich27 karma

Are you one of my sons?

I'm a terrible investor. Don't follow my investment advice.

[deleted]13 karma


robertbreich15 karma

We don't have to look to another country. For 3 decades after World War II, we were moving toward a society of broad-based prosperity. Then, starting in the late 1970s, we went backwards, toward more and more inequality. Let's just return to the principles that guided us before. (And, no, I wouldn't identify myself as a socialist or any other "ist.")

Cassius68 karma

A few questions on economic policy:

1) How do you think we should best deal with our debt? I've heard the idea that deficits are a symptom of low growth and economic instability, not the problem, and that we need to focus on stimulus. However, I know that 10-15 years from now, we'll really regret not doing anything about our deficit if we don't do anything.

2) Do you think the Euro will have to lose a country or two in order to survive? Was it actually the case that the Europeans invested too heavily in pensions/ect., or is all of the European instability a result of a slowdown in growth to make up for the spending.

robertbreich15 karma

1) In short term, stimulate. Once economy is growing near 3 percent/year and unemployment is down to 6 percent, cut public spending (especially defense, farm supports, corporate welfare) and raise taxes on top earners and the wealthy. 2) Euro-zone's central problem is that members have their own fiscal policies but share the costs and consequences of irresponsible debt. Can't do both.