CNN's Eliot Spitzer arrogantly lectured about the benefits of Keynesian economics Sunday while accusing fellow panelists on "Fareed Zakaria GPS" of not knowing what they were talking about because they weren't business owners.
This led British historian Andrew Roberts to point out that President Obama's administration are mostly academics, and Ann Coulter to ask Spitzer, "What business have you ran? You’re a governor" (video follows with transcript and commentary):
ELIOT SPITZER, CNN: Just so it’s clear before Ann starts jumping up and down, I actually believe Keynes was right. I believe that Keynesian economics works and is also true of the Constitution, something the Tea Party may not agree with. And I think the President needs to defend not just in the context of the auto bailout where it’s easy to point to GM and Chrysler and say, “Look what we accomplished,” but the entire economy would have been so much worse. The implosion of both confidence, the financial system, job creation, would have been devastating had we not put in place that cushion of the stimulus package. Now, you’re arguing it counter-intuitively, you’re saying, “It would have been worse but for,” and that’s not an appealing political argument, but it’s economically beyond question. And I think the President now at this moment of intense weakness, lack of job creation, needs to bring all of this oratorical and intellectual skills to bear to say, “Here’s what the record shows us.” David Cameron may be a great leader, the British economy is not faring terribly well because of those cuts. I mean, there is a certain mathematical reality…
ANDREW ROBERTS, BRITISH HISTORIAN: In Britain, we’re trying to deal with this debt.
CHRYSTIA FREELAND, THOMSON REUTERS: But maybe you’re doing the wrong thing.
ROBERTS: Maybe we are, but, but, but he has been elected to try and see this through, and he is seeing it through, and if he does turn out, as I believe, to actually to get away with it, then the anti-Keynesian view will be proven right. The Hayekian view, this next election is going to be a classic Hayekian versus Keynesian election.
FREELAND: In the U.S.
ROBERTS: In the U.S.
ANN COULTER: We’ve run this experiment at different times in this country over and over and over again, and every time nothing is done, there is no Keynesian spending, the economy recovers like that and we have a boom. It did in the ’20s, it did in the ’80s, and every time FDR and Obama jumped in…
FAREED ZAKARIA, HOST: In the ’80s, I would call a massive increase in defense spending during the Cold War…
COULTER: And massive cuts in taxes…
ZAKARIA: Which are Keynesian. Keynes was in favor of taxing. He never made a particular distinction between government spending and or taxing. His point was you need demand in the economy, you need to stimulate demand.
COULTER: Right, but, no, no, no Ronald Reagan winning the Cold War was not part of his taking a Keynesian approach to the economy.
SPITZER: Ann, your statement would be nice if it were true, but it’s not. The reality is if you look at the economics, and you look at what the impact is of both cutting the marginal rates, government spending, the incentives you create to job creation, Keynes has been right at every turn in terms of understanding. If you actually sat down and either were a business person making capital allocation decisions, hiring, you’d understand that what you look at is your return.
In reality, I quite agree with Spitzer that business people making capital allocation and hiring decisions are best-suited to understand how the economy works. Unfortunately, the former New York governor turned CNN host doesn't qualify, as his curriculum vitae identified absolutely no business experience whatsoever.
After graduating from law school, Spitzer first clerked for Judge Robert W. Sweet in Manhattan, then went to a variety of law firms and the Manhattan district attorney's office before entering politics in 1994.
As such, there is not one second of actual business experience in Spitzer's background. Yet, he's lecturing fellow panelists about his economic acumen while claiming businessmen are better suited to make such decisions:
SPITZER: Right now there’s a demand crisis of enormous volume. That’s why we need to create demand in this economy to generate things that we can buy…
COULTER: And Obama’s been following your policies, and that’s why we have a crisis.
SPITZER: The executives are sitting on $2 trillion of capital. The key to getting that capital back into the economy to hire people is demand for the products being made. There has not been a whole lot of ambiguity about that.
COULTER: We have been creating demand with the stimulus money and oddly enough it hasn’t worked, and what the businessmen themselves are asking for is, “Release us from taxes and regulations.”
ROBERTS: The kind of tax cuts that Mr. Pawlenty is talking about, the huge tax cuts that Mr. Pawlenty is talking about, and indeed cutting back the GDP, the amount spent on GDP from the 24 percent it is now to the 20 percent that Mr. Romney wants or the eighteen percent is going to allow moneys to come back into the economy through tax cuts.
SPITZER: Explain to me why. If people are sitting on capital, who are sitting on capital right now who are not investing because capital gains rates are 15 percent…
SPITZER: You’re saying if you take that fifteen percent, you’re assuming they’re going to invest even when there’s no demand for the product?
FREELAND: Right. What Eliot is pointing out is there’s a lot of money, there’s a lot of money on the sidelines.
Now watch Spitzer stick his foot in his mouth:
SPITZER: Have you ever made, have you been in business?
ROBERTS: Not myself.
SPITZER: You don’t understand how these capital allocation decisions are made. You really don’t.
ROBERTS: Okay, sorry, how many of President Obama’s actual, of which he now only has one left, Mr. Geithner from his original team, they all have left, how many of them actually did businesses themselves? Very few of them. Most of them were academics. So don’t just attack people simply because they think differently than you do.
Indeed. As JPMorgan's Michael Cembalest wrote at Forbes in 2009, Obama's cabinet has few members with actual business experience.
Using Spitzer's guidelines, shouldn't they be exempt from making economic decisions for this nation? More importantly, shouldn't Obama who also has ZERO experience in the private sector and NONE as a business owner?
And why should Spitzer be qualified to lecture about something that by his own standards he's unqualified for?
Coulter didn't miss this hypocrisy:
COULTER: What business have you ran? You’re a governor.
COULTER: You’ve been in politics your whole life. You’re haranguing us. “If you were a businessman.” This is the strangest conversation I’ve ever seen.
SPITZER: No, Ann, because you’re making statements that are so completely counter-factual...
ROBERTS: I'm a historian. I didn't live in ancient Rome but I can still write about it.
SPITZER: You're statements about the economy are simply counter-factual, contrary to every piece of evidence…
COULTER: You’re right, you’re right, the economy is just booming right now. That Keynesian economics Obama gave us has been a delight.
The reality is that Spitzer once again showed himself to be a staggering hypocrite.
On the own hand, he lectured guests about economic theory having majored in international affairs at Princeton University and attended Harvard Law School.
He then claimed that others sitting with him were unqualified in matters of finance and economics due to their lack of business ownership while having never himself owned a business.
As I agree with him that folks with actual business experience are likely far more adept in financial and economic affairs, it would be nice to see him and other Democrats now lecturing Americans about their expertise in such issues to disqualify themselves as quickly as they are those on the other side of the aisle that have spent their entire adult lives in the private sector.
Or is that asking too much from a disgraced politician turned disgracefully biased journalist?