Alan Auerbach

Digging deep into federal default scenarios

Alan Auerbach interviewed by National Public Radio, On Point, October 10, 2013

“I don’t see how the largest economy in the world defaulting on its national debt isn’t a big deal. This is likely to raise the U.S. government’s borrowing rate and lead to a severe loss of credibility that the U.S. government can deal with the important issues it faces—not just on budget issues, but on other issues. If the U.S. government can’t even handle this issue, then why should our allies around the world think that we can deal with other important questions?”

Tax earnings where products are sold

Alan Auerbach writes for The New York Times, Room for Debate, May 30, 2013

Our corporate tax is showing its age…. The fundamental problem is our reliance on the concepts of residence, or where a company is located, and source, or where the company’s assets and production activities are located. These concepts may have worked reasonably well in the 1930s, but they do not hold up when confronting a multinational company with global operations.

GOP lacks incentive to provide details

Alan Auerbach quoted in San Francisco Chronicle, October 16, 2012

“There’s a deeper problem, because if they preserve a lot of these middle-class deductions (like the mortgage tax deduction), and they also say they’re going to avoid lowering taxes and raising the deficit, and they’re also not going to raise taxes on savings as investment and capital gains,” Auerbach said, “then they’ve boxed themselves in such a way that they can’t meet all their objectives.”

At Stanford, answers to the political question: How’s the economy?

Alan Auerbach quoted Stanford Report, September 26, 2012

According to Auerbach, the current drag on most of these economic indicators is a lack, not of private sector growth, but of government spending…. “The general impression is that government has grown or is out of control under the Obama administration,” said Auerbach. “But what’s actually holding us back is very weak growth in the government.”

Siemens plant in Charlotte offers lessons as Obama, Romney talk job creation

Alan Auerbach quoted in The Washington Post, September 4, 2012

Auerbach, who has studied the economic effects of tax cuts, said lower taxes on savings and investment do cause people to plow more money into new investments, which “should lead to faster economic growth.” But “how much, how fast” is harder to say, Auerbach said. And that approach is, in any case, less likely to be effective in a sluggish economy, he said, when businesses are holding back on new investments not because they do not have the cash, but because they are “looking first at whether they can sell stuff.”

Economists to Romney campaign: That’s not what our research says

Alan Auerbach quoted in The Washington Post, August 8, 2012

I e-mailed Auerbach the relevant quote from the Romney campaign’s paper, and added…. Do you think that reporters like me should assume that the 0.5-1% gdp boost is a reliable base case? His response came quickly. “I did not see the [Romney campaign’s] paper, but from your description the basic answer to both of your questions is ‘no’,” he replied. His paper looked at “a much bigger tax change than Romney is proposing.” It also “assumed that all tax changes were revenue-neutral on an annual basis; the size of the Romney tax cuts makes this a questionable assumption.”