Govts fudging data; making unrealistic policy assumptions

Lawrence Summers called Donald Trump's first Budget "ludicrous"

Devangshu Datta 

Devangshu Datta Lawrence Summers called Donald Trump’s first Budget “ludicrous”. It makes extravagant assumptions of high GDP growth for a decade. It also makes the elementary mistake of double-counting. Mr Trump proposes to cut tax rates and to make spending cuts.  The spending cuts are assumed to lead to a $3.6-trillion reduction in federal expenditure over a decade. The tax cuts will supposedly stimulate activity, leading to annual GDP growth of three per cent. The growth acceleration will, despite reduced tax rates, garner an extra $2 trillion in tax revenues over the ...

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Govts fudging data; making unrealistic policy assumptions

Lawrence Summers called Donald Trump's first Budget "ludicrous"

Lawrence Summers called Donald Trump's first Budget "ludicrous" Lawrence Summers called Donald Trump’s first Budget “ludicrous”. It makes extravagant assumptions of high GDP growth for a decade. It also makes the elementary mistake of double-counting. Mr Trump proposes to cut tax rates and to make spending cuts.  The spending cuts are assumed to lead to a $3.6-trillion reduction in federal expenditure over a decade. The tax cuts will supposedly stimulate activity, leading to annual GDP growth of three per cent. The growth acceleration will, despite reduced tax rates, garner an extra $2 trillion in tax revenues over the ... image
Business Standard
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