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Advisor addresses economy

Meghan Thomassen | Thursday, October 4, 2012

Right before President Barack Obama and Republican presidential nominee Mitt Romney debated for the first time on live television Wednesday night, economist Jared Bernstein spoke on the government’s role in the economy.

Bernstein, former economics advisor to Vice President Joe Biden, addressed students and faculty at the annual McBride lecture.

“I don’t know that I’ve ever seen an election that so starkly presented a choice about the role of government in our economy and in our economic lives,” Bernstein said.

The two parties have different views on the government’s role in the economy, Bernstein said.

“The question is: What’s the proper function of the government in advanced economies like ours?” he said.

Both candidates believe markets and market forces should dominate, Bernstein said.

“It’s not a matter of one side believing the government should do everything and the other side believing the government shouldn’t do everything,” he said. “It’s a matter of where you draw the line. I’m talking to younger people now. I want you to think yourself of where you would draw that line.”

In an interview before the lecture, Bernstein said the jobs market is up for debate because the unemployment rate is still too high.

“The budget deficit aspect is a trickier discussion in the sense that the budget deficit itself is a function of the great recession, and as the economy recovers from that, the pressure from the budget deficit will naturally come down,” Bernstein said. “But it will certainly be a part of the discussion.”

Bernstein said neither candidate has offered sufficiently concrete plans to improve the job market.

“It’s a little tricky for the president in the sense that he proposed a plan a year ago called the American Jobs Act in Sept. 2011 and Congress wouldn’t even look at it,” he said. “He has an extra barrier to face; even if he comes up with good ideas he has a Republican House [of Representatives] that is stonewalling him.”

Pressure to overcome the barriers between the government and economic solutions will need to come from the public, Bernstein said.

“I’m a denizen of Washington and its extremely frustrating to see just how dysfunctional Congress is right now, at a time when we have real economic challenges to face,” he said. “If the economy were humming along at five percent unemployment rate, I might feel less frustrated with this gridlock, but we have big problems to solve, and Congress just threatens to make them worse.”

The pressure will need to come from both sides of the political aisle, Bernstein said.

“The refusal to compromise is antithetical to getting anything done in politics,” he said.

Bernstein’s lecture was part of the Higgins Program, which established the McBride Lecture with the United Steelworkers in 1977 “to better understand the principles of unionism and our economy.” Bernstein is a senior fellow at the Center on Budget and Policy Priorities.

The lecture preceded a live streaming of the presidential debate Wednesday night in the Hesburgh Library Auditorium.