Scarborough, Bartiromo falsely inflate WH economic growth assumptions
Posted in Main Blog (All Posts) on July 8th, 2009 4:42 am by HL
Scarborough, Bartiromo falsely inflate WH economic growth assumptions
During the July 7 edition of MSNBC’s Morning Joe, host Joe Scarborough falsely claimed that the Obama administration’s budget assumed “that the economy’s gonna grow at 4 percent next year and over the next decade.” Maria Bartiromo, host of CNBC’s Closing Bell, repeated the false claim about the administration’s growth assumptions, responding in part that “a lot of people, independent forecasters, were not expecting growth next year, and yet, in the budget, we’ve got an assumption of 4 percent growth.” But the White House did not assume a growth rate of 4 percent of real gross domestic product either “next year” or “over the next decade.” According to the White House’s budget outline, the administration predicted growth would next reach 4 percent in calendar year 2011, not 2010, for which it assumed a growth rate of 3.2 percent. Moreover, the administration projected that economic growth will peak in 2012 at 4.6 percent, then decline to 2.6 percent by 2015 and hold constant at that level through 2019.
Moreover, Scarborough claimed that the administration’s deficit projections are too low, asserting that “those deficits are going to be even higher, even more crushing, even more — using the president’s words — unsustainable.” But as Scarborough noted, he assumed that the deficit projections are “based on [the administration’s] assumptions that the economy’s gonna grow at 4 percent next year and over the next decade.”
From Obama’s budget outline:
From the July 7 edition of MSNBC’s Morning Joe:
SCARBOROUGH: Now, here’s the danger. The danger is that all of these assumptions — you know, we’ve been saying, and even the president’s agreed with what we’ve been saying around this table for the past five months of late, and that is we’re out of money. The deficits are unsustainable. But these deficits that are unsustainable are based on their assumptions that the economy’s gonna grow at 4 percent next year and over the next decade. It’s not gonna happen. That means, Maria, those deficits are going to be even higher, even more crushing, even more — using the president’s words — unsustainable. This is the biggest crisis, economically, I think, facing us, isn’t it?
BARTIROMO: I agree with you, and I think that saying that we had incomplete information — you know, I don’t know, I mean, when — you know, earlier in the year we knew that unemployment would worsen. We knew that the rest of the world was really, you know, coming apart, certainly Europe. We knew that economic growth was slowing sharply. I think a lot of people, independent forecasters, were not expecting growth next year, and yet, in the budget, we’ve got an assumption of 4 percent growth. How do you get there from negative — you know, negative contraction in the U.S. economy? It’s really — it’s impossible. A lot of people were questioning that, and I agree, now, you’re not going to get any dent in the deficit from tax increases. The numbers just don’t add up, so you actually have to cut spending. So hopefully this incomplete information, or the idea that it’s worse than we thought, will cause them to cut spending. I don’t know.
