Kevin Hassett In Lie Lie Land

I feel sorry for Kevin Hassett.  Of course he made a complete fool of himself two decades ago with his book on Dow 36,000 (still some ways away) with James Glassman, but he has had a good amount of time to get over that embarrassment.  When he was appointed CEA Chair for Trump, he was of the few appointments Trump made that received praise, especially in the  area of economics.  Pretty much everybody else appointed was some combination of corrupt (a bunch of those), incompetent (see abysmal forecasting record of Lawrence Kudlow, NEC Chair), or just plain insane (see warmongering Peter Navarro).  A longtime economist at the AEI and a former adviser of earlier GOP presidential candidates, Hassett had a conservative but mostly pretty respectable record, as well as being known as a nice guy.  Even many people on the left said nice things about him at the time of his appointment.  Indeed, he was not obviously corrupt, incompetent, or insane, despite some mistakes here and there (see Dow 36,000in particular).

Anyway, after getting appointed and Trump becoming president, Hassett has largely disappeared.  Near  as I can tell, the main time he surfaces  was when the CEA put out the Economic Report of the President, the main ongoing official function of the CEA.  For decades the CEA was viewed as the main body providing economic policy advice to presidents, and often the CEA Chair  actually was the top individual economic adviser to the president, although who that is at any point in time has always ultimately been a matter of personalities.  But then for reasons that remain mysterious to me, Bill Clinton created this new body when he came in, the NEC. It  (and especially its Chair) was supposed to communicate to the media and Congress, it apparently being viewed that CEA Chairs were too abstract or in the clouds or whatever to engage in such communications.  But the question became which of these  would have the presidential ear, and more often than not these NEC Chairs have been closer to presidents than CEA Chairs, even though more often than not the case has been that the CEA Chairs have known more about economics than the NEC Chairs.  This is ceetainly the case now, with the incompetent Kudlow regularly identified as being Trump’s “top economic adviser,” while the much more competent Hassett has been largely invisible.

Before getting into more recent events, let me note that the Economic Report of the President Hassett and his CEA staff put out avoided making actually incorrect statements, at least that I am aware of. Of course data favorable to the administration was emphasized and arguably overly optimistic projections were made regarding the future impacts of policies, especially the tax cut.  But then this is normal CEA behavior in most administrations, putting as positive  spin on actual data and making optimistic, but not off-the-wall projections of policies.  So far so good, or at least not too bad.

Indeed, up until very recently at least the CEA was playing it straight, although in doing so some of its findings were prevented from being publicized.  Thus in early June there were leaked reports that the CEA had determined that Trump’s tariffs would damage future economic growth of both the US and also the rest of the world’s economy.  When asked about these reports, Hassett had no comment other than to follow the line put out by Kudlow and some others that the tariffs will bring about a move to greater free trade and thus to greater growth.  So far there is little evidence that this is likely to happen, but it is indeed a not absurd thing to say.  It is the official line of the administration, which in fact clearly recognizes that at least the near term effects of the tariffs are damaging to many.  Thus we have Trump’s move to provide aid to farmers harmed by foreign tariffs.  And then we had horrendously corrupt Commerce Secretary Ross at one point lecturing those injured to the effect that “gains” are not achievable without some “pains.”

But now we find Hassett not only surfacing but doing so in a way to support serious distortions with much more seriously manipulated data.  This involves Trump’s exaggerated claims regarding employment increases and especially those for African Americans.  Trump has been repeatedly making exaggerated claims about employment increases and unemployment rate declines, but he went completely off the deep end into lie lie land a few days ago.  He claimed to have “created” more jobs for African Americans since coming into office than Obama did during his entire time in office.  As it turns out the total increase in African American jobe under Obama was nearly ten times what was claimed by Trump.  That there had been a boo boo on this matter was admitted by Sarah Huckabee Sanders, the mistake was so blatant.

This is where Hassett stepped in with some carefully rigged numbers that Sanders could cite to provide a partial comeback after this admission of substantial error.  Hassett was quoted on job growth during the “first 20 months of each administration.”  Oooops!  Quite aside from what happens in the first months of an administration not really having much to do with policy of that administration, Trump has only been president for 17 months, not 20.  Hassett gave to Obama the massively horrendous final quarter of the Bush administration while Trump was credited with reasonably decent performance in the final quarter of the Obama administration. The periods compared were the 20 months following the elections.  These changes made Trump’s record look much better relatively.  This is beyond merely looking at the best side of data, it is outright lying, and Hassett’s name is on it,

So now Hassett can be viewed as a full-blown member of the Trump administration.  He has joined the rest of it in Lie Lie Land.

Barkley Rosser