Fox News
Expand
Browse All Video
Watch Live

You're watching...

Path to Double Dip Recession

Details

  • Description

    Former Reagan advisor on struggling economy

  • Duration 4:10
  • Date

Clips

Also in this playlist...

Editor's Picks

Auto-advance: ON

Auto-advance
View All

Transcript

This transcript is automatically generated

And check out these numbers back here history would say a whole lot about we -- might be having.

The last double dip recession the early 1980s -- first it happened in 1980.

The second -- from 1981 to 1982 you see it on the screen there.

Unemployment went from six point 3% to ten point eight that's a blow out number and inflation.

Shot up 11%.

During the 1980s recession my next -- worked as president Reagan's economic advisor during that time art -- is frequent back with me.

At a Nashville good morning to you aren't good morning bill how are you I'm fine we've come to you for answers.

How do we get -- evidence.

You gotta cut government spending everyone talks about government spending creating jobs bill and that's not true.

You can see that really clearly if you have a two person world to farmers.

If one of those farmers -- unemployment benefits -- do you think pays form.

If the other farmer government spending is taxation and the reason we have not recovered is because of the huge increase government spending.

That is holding this economy back it's really tragic but we've got to bring that spending down.

And down fast to get a growing are not allowed -- -- -- -- yeah okay go ahead with your last point don't wanna laugh as -- little song about history.

Yeah have you ever heard of a poor person spending himself -- -- prosperity it just doesn't make sense and the first step in 1980 I mentioned that the second -- happen from 1981 to 1982 recovered.

A cassette recorders that your unemployment shot through the roof as I mentioned -- and the inflation was up more than 11%.

History tells us a lot.

What does that -- tell you as you remember.

In 1981 when we pass the tax bill and we got the huge tax cuts which is -- August I think of 1981.

We phased in the tax cuts because they were all worried about deficits they wanted not to have a tax cuts occur right away.

So the tax cuts actually began in force on January 1 1983.

It is amazing how tax cuts don't work until they take -- fact if you -- bill that they were gonna cut tax rates next year.

What would you do this year.

You defer all the income you could as exactly what they get out of 81 and 82 and then on January 1 1983.

The economy skyrocketed if you look at my parents article in 1981 I went through this -- carefully it was a huge mistake by the congress and by the president.

But it worked in the long run but it causes deep recession of 81 and eighty -- -- you.

Mention 1983 as we look back those with the boom -- GDP growth was extraordinary first quarter shot up five point 1%.

Second quarter nine point 3% man what we want to do that now that great eight point 1% in the third quarter and eight point 5% in the fourth quarter.

And you believe it would only tax policy that had to do with that.

Not only everything else was at work -- if you'll remember He did all sorts.

-- things that were wonderful but tax policy was the key to the timing.

Of that by delaying those tax cuts.

We caused the deep recession of 8182.

And then the boom of 8384.

Was because those tax cuts took effect but we would have had a very good economy because -- Paul Volcker is monetary policy.

Regulatory policy tax policy.

It was all kicking in together.

Which is Reagan -- -- -- -- 2011 now do you see this White House changing policy that would go in that direct.

You know unfortunately I don't see -- there -- so ideological or so -- tribal you know they just can't admit their wrong.

I mean everyone knows that that government spending it wasn't just Obama it was W just as much is Obama it's bipartisan ignorance.

But they just won't admit their mistake if they admit the mistake.

Get that spending down this economy could be booming.

And we would have prosperity but they just want -- admit it while men have met and it's tragic may be in the end you're wrong this time we shall -- affect our -- I've been wrong I've been wrong a lot my life but -- I don't think I'm wrong in this one built our thank you art Laffer at a Nashville -- -- -- -- -- open -- an eleven -- animals -- packed house.

-- --

Load More