Jason, We Hardly Knew Ye

Does Jason Furman, the Obama campaign's new economic policy coordinator, really favor privatizing Social Security and cutting corporate taxes?

Nonsense.

But these are just some of the inaccurate impressions left by last week's news and blog coverage of Furman's appointment.

The accounts portrayed Furman as a pro-Wall Street economist who previously headed the Brookings Institution's Hamilton Project, which Robert Rubin helped establish; Furman was at Hamilton less than 18 months. Some accounts also mentioned that he was an economist in the Clinton White House. None of them mentioned any other part of his background.

Before moving to Hamilton, however, Furman was a Senior Fellow at the Center on Budget and Policy Priorities, where he churned out one hard-hitting progressive analysis after another on issues from Social Security and tax cuts to income inequality and the minimum wage. In addition, while his most recent affiliation was with Hamilton and, hence, Rubin, he earlier worked for Joseph Stiglitz, the Nobel laureate economist whose views are distinctly farther to the left than Rubin's. I did not see a single account that reported these facts.

Especially bizarre was a poorly researched Los Angeles Times article that suggested Furman may favor privatizing Social Security and, on that issue, holds views similar to President Bush. That's like saying Karl Rove is a liberal Democrat who wants to repeal the Bush tax cuts and withdraw from Iraq. Everyone involved in the 2005 debate over Bush's privatization proposal knows it was Furman's devastating analyses shredding the Bush plan and skewering the arguments of privatizers that formed the intellectual core of the successful opposition. Democratic Members of Congress, unions, and grassroots campaigns against the Bush plan built much of their critiques on Furman's work. The White House official in charge of Social Security later commented that Furman's analyses played a central role in killing the President's plan.

Equally egregious was a claim that Furman had attacked the minimum wage and progressive taxation in an appearance a few years ago on Larry Kudlow's cable TV show. Those making this charge mistakenly attributed to Furman the remarks that right-wing supply side guru Arthur Laffer, with whom Furman was jousting, actually made on the show.

To be sure, the transcript of the show was a mess because Laffer and Furman frequently interrupted each other. But those who took the time to read the whole transcript would not have gotten this wrong. If they had any doubt whether the offending statement came from Furman or Laffer, they could have checked the Center on Budget and Policy Priorities website, where they would have found a voluminous body of Furman's papers calling for more progressive taxation and an increase in the minimum wage and castigating the Bush tax cuts.

Washington Post columnist David Ignatius also unwittingly contributed to the confusion by reporting that Furman had penned an op-ed last year calling for cutting corporate tax rates and eliminating the Alternative Minimum Tax. This created the impression that Furman favors tax cuts for the corporate sector and affluent individuals. Ignatius failed to explain that Furman's op-ed was praising a bill by Rep. Charles Rangel to cut the corporate tax rate, eliminate the AMT, and also cut taxes for 90 million low- and middle-income households - and fully offset all of the cost by closing corporate loopholes and raising tax rates on the wealthiest Americans back to Clinton-era levels. All that would create a tax code that's considerably more progressive, simpler, and more economically efficient.

Finally, several news accounts, including a Huffington Post column, portrayed Obama's hiring of Furman as a move to the political center now that Obama has wrapped up the nomination. This, too, is dubious. Prior to Furman's hiring, Obama's two top advisers on economic and fiscal policy were University of Chicago economist Austan Goolsbee and Harvard economist Jeffrey Liebman. Goolsbee, Liebman, and Furman are all moderately left of center. In fact, reading the work of all three (each of whom is considered a top-notch economists) leads one to put Furman modestly to the left, not the right, of the other two. In recent years, Furman's work has focused, in particular, on how to change government policies so the gains of economic growth are more evenly shared, with more gains going to low -- and moderate -- income working families and fewer to corporate profits than has recently occurred.

Let's hope that, as the presidential candidates name more policy advisers, the media and blogosphere do a little more homework and produce reporting and commentary that's a bit better informed by the facts.

Readers deserve better.

Robert Greenstein is executive director of the Center on Budget and Policy Priorities.

Comments

[ProudLiberalDan]

I had the privilege of taking a Macroeconomics Course by Jason Furman at Columbia University.

He is a wonderful teacher and explains complicated economic principles and theories clearly and thoughtfully.

I didn't support Obama (or Clinton) during the primaries, but I find Obama's appointment of Furman to be a reassuring one.

After this appointment I have great faith that Obama will pick a terrific team once he is President.

[outnow]

Jason Furman favors the off-shoring of jobs that benefits Wall Street, CEOs, and large retailers at the expense of the economic well-being and careers of millions of Americans. Wal-Mart tells its suppliers to meet Chinese prices or else. Every job that is outsourced increases the US trade deficit and undermines the reserve currency role of the dollar.

The article never mentions the outsourcing of jobs, only the destruction of social security. , taxes, etc.The Democratic party will follow Bill Clinton's lead in outsourcing more jobs.

I would appreciate the author responding to the Rubin-esque outsourcing problem. Jason Furman remains one of the two leading apologists, along with Robert Rubin, for outsourcing of jobs. As the co-dean of outsourcing, Democrats have lost this essential battle for jobs with Furman's appointment

Given this "economic reality" of Obama's political platform and his recent capitulation to AIPAC, we only have hopes that his election would prevent another Federalist Supreme Court appointee from overturning the 5-4 majority that narrowly upheld Habeas Corpus. He, like Bill Clinton favors free trade for Wall Street.

[ddharder]

Good post. Like you said, the election has once again been reduced to choosing between the better of two evils. And I had such high hopes for a candidate that was publically spurning PAC and other lobby controbutions.

[ddharder]

I fail to understand the logic behind making SS a sacred cow. It's nothing but a ponzi scheme that demands more workers to keep it afloat than retirees drawing out of it. The boomer generation will necessarily crush the system anyway. I don't necessarily favor privatizing it, but it would be nice if people would start asking the hard questions about it and quit politicizing it.

[Liberal2]

Well gee, son, move to a country without such ponzi schemes and let us know how great life is there.

Why is it all you whiners never go to countries more attune to your philosophy of "grab all you can, screw the other guy"?

BTW, "...the logic behind making SS a sacred cow..."???? Try researching the companies that are eliminating pension plans for anyone not in top management.

[ddharder]

First, I have moved. Been gone for 4 years now and am not coming back. Even so, the government forces me to pay SS tax on money earned abroad. Besides Libya, the US is the only country that taxes its citizens on income they earn abroad.

Second, it's not a pension plan. Pension plans are invested and are allowed to grow. SS works exactly like a ponzi scheme. It takes money from workers contributing and pays it out to those retired. As soon as there are more retirees than workers the system will colapse the same way Ponzi's scheme did.

Finally, how am I screwing anyone? I'm simply asking for a reasonable debate about a plan that is ultimately doomed just based on the numbers. People just want to bury their heads in the sand and hope it doesn't happen before they get theirs.

[Grace2008]

Thank you, Mr. Greenstein, for taking the time to present the facts accurately and giving readers the infromation they need to make an informed and wise choice in November.

[freshnotbitter]

The danger I see in Furman is not left/right oriented but past/future. Rubin, Furman, and others were great during the Clinton years at managing the great leap forward in automating through technology (internet) and introducing 1 billion Indians and 1.5 billions Chinese to the global economy. (They did a really bad job with Russia and ok with Brazil).

We now have a developing situation and we need the right kind of leadership to deal with it. I don't think WTO, NAFTA and KYOTO are half as good as they could be in managing world economic affairs. If people are going to jump up and down and call each other dirty names, like protectionist, just because they want to change and improve on these arrangements then we are in trouble and we need somebody who can articulate these problems. Is Jason Furman capable of this or does he still think Walmart is the "new wave". (I can't find stuff in there anymore, Jason. there was one reason I used to go to Wal mart: I knew they'd have it. Not anymore.)