Big Think Interview With Dean Baker | Big Think

Big Think Interview With Dean Baker

New videos DAILY

Join Big Think Edge for exclusive videos

----------------------------------------------------------------------------------

A conversation with the author and co-director at the Center for Economic and Policy Research.

----------------------------------------------------------------------------------

Dean Baker:

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, DC. He is frequently cited in economics reporting in major media outlets, including the New York Times, Washington Post, CNN, CNBC, and National Public Radio. He is author of several books, including "False Profits: Recovering from the Bubble Economy" and "The United States Since 1980." His popular blog Beat the Press is a weekly commentary on the state of financial reporting.

----------------------------------------------------------------------------------

TRANSCRIPT:

Question: How has Obama done so far?

Dean Baker: It’s a very mixed picture. I mean, he’s done some things that are very big, very important. The stimulus package got passed in his first month in office. That was important. It’s a big step towards combating the downturn. He’s gotten healthcare on the agenda. He has plans in his budget to start on healthcare and he’s worked with Congress to have it included in the reconciliation process which means the Republicans can’t filibuster it. He’s also put forward ambitious plans on energy, which is part of the stimulus. So he’s done a number of big, important things: extended employment benefits, changed the formulas so that a lot of people that had not been covered previously are now covered and provided healthcare benefits. People who are unemployed will have 65% of their healthcare benefit covered by the government, which makes it affordable for a lot of people that could not otherwise afford health insurance once they’ve lost their jobs. So a lot of good things.

Where I give him bad marks is his dealing with the financial system. We had a really big problem with finance run amok. That’s what got us here. That’s what led to the downturn and it has to be reined in and he doesn’t seem prepared, at least he hasn’t seemed prepared at this point, to really take the hard steps to rein in Wall Street. And what I worry is that we’re going to get out of this, one, costing the tax payers huge amounts of money because we’re looking at spending at least hundreds of billions, and quite possibly over a trillion dollars to bail out the banks. And, two, basically, leaving them in shape, leaving them as they were being prepared to run amok again. So, I think that would really be unfortunate. It’s a really big drain to the tax payers. It’s a huge amount of money. We’ve had big fights over sums that were less than a hundredth as large, and then on top of that, not to wrestle back the sector when it’s really crying out for serious regulation. It really has to be reined in. Wall Street has to serve the rest of the economy. When you have an economy that’s being run to serve the financial sector, you’re asking for trouble.

Question: Does Obama mark the end of Reganomics?

Dean Baker: Well, it’s a mixed picture. I don’t think it will ever fully end. I mean, Reaganomics, to put it simply, was trying to get low taxes for wealthy people. And [wealthy people] are still there pushing for low taxes. So President Obama said, and he’s expected to carry through on this, that he will restore the Clinton era tax rates so high-end people will pay somewhat higher taxes. But it’s not as though the people pushing for lower taxes are about to go away. And basically, it’s going to depend on President Obama’s performance: if he does well in office, if in 2012 we see the economy recovering—I don’t expect it to be fully recovered; I don’t think anyone does—but if the unemployment rate is down and heading in the right direction and if the economy is growing strongly, he’ll get reelected and that’s going to push back the people who want to have lower taxes. But they’re still there.

Now, as far as the larger, pro-business agenda, all that’s very much up for grabs. Again, I was referring to Wall Street. Is Wall Street going to be reined in? You could say that’s part of Reaganomics, i.e. Wall Street running amok. I would. And we don’t know that at this point.

Healthcare reform is a huge issue. I think President Obama’s pushing the right way but it’s far from a done deal that he’ll get any healthcare reforms. It’s certainly not a done deal that he’ll get, to my mind, effective healthcare reform which would involve, first and foremost, a creation of a good public plan that will compete with private insurers.

Read the full transcript at