Tuesday, January 29, 2019

'Velshi & Ruhle' on the cost of the shutdown and the effect of the tax cut

I opened MSNBC and CNBC report on looming recession risk by writing "The longest government shutdown in U.S. history is over, but it lasted long enough to have an economic effect that might last."  Velshi & Ruhle on MSNBC examined some of the lasting effects in Calculating The Cost Of The 35 Day Government Shutdown.

Shutting down the government for 35 days may cost the American economy $11 billion - this according to the non-partisan Congressional Budget Office. Stephanie Ruhle and Ali Velshi are joined by CNBC’s Editor at Large, John Harwood, to discuss the economic repercussions of the shutdown and prolonged budget battle.
CNBC reported that, not only did the CBO estimate that the shutdown cost the U.S. economy $11 billion, but also that $3 billion in economic activity has been permanently lost and that economic growth will slow this year to 2.3 percent, compared with the 3.1 percent rate last year, as the benefits of the new tax law begin to fade.

That brings me to the next segment from Velshi & Ruhle that MSNBC uploaded to its YouTube channel, which asked Is The President’s Massive Tax Cut Plan Falling Flat?

President Trump promised a $1.5 trillion tax cut package would boost hiring, but a new survey shows it has had no major impact on business spending or hiring plans. Policy Analyst from the American Enterprise Institute James Pethokoukis joins Ali Velshi and Stephanie Ruhle to discuss.
I find the remark that former Starbucks CEO Howard Schultz might care about deficits but no one else really does amusing.  The man does not have much of a constituency for that issue.  For what it's worth I did mention the increased deficits and national debt in The tax bill and the U.S. economy in 2018 and beyond as a result of the tax cut, but I didn't think it would have an effect already.

On the other hand, I did not mention that the tax cut would not result in increased hiring and wage increases; I focused on how it would make the recession after next worse instead.  However, I'm glad Velshi & Ruhle pointed that out as a failure of the sales job for the tax cut.  I learn a lot from their show as I enjoy watching them onscreen, particularly Stephanie Ruhle.  She's fun, smart, and makes Ali Velshi look good.

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