American Enterprise’s Kevin Hassett Predicts That if Obama is Reelected in 2012 U.S. Will be Locked into Uncontrolled Debt Forever

American Enterprise Institute Senior Fellow Kevin HassettKicking off his nationally syndicated “Neal Asbury’s Truth for America Show” on WZAB-AM, Neal Asbury opened the show by declaring that “we’re going to find our way out of this dark, dank debt tunnel.  We will find a solution to this situation – we always do.”

Returning to the show as a guest was Kevin A. Hassett, the director of economic policy studies and a resident scholar at the American Enterprise Institute. Before joining AEI, Mr. Hassett was a senior economist at the Board of Governors of the Federal Reserve System and an associate professor of economics and finance at the Graduate School of Business of Columbia University. He was an economic adviser to the Bush campaign in the 2004 presidential election, and was the chief economic adviser to Senator John McCain (R-Ariz.) during the 2000 primaries. He has also served as a policy consultant to the U.S. Department of the Treasury during both the former Bush and Clinton administrations.

Hassett labeled the next election cycle as “one of the most important in our nation’s history”.  He predicted that if Obama is reelected and the U.S. continues on its current economic course, “this country will be locked into its current debt level forever.” He believes that the U.S. debt could account for 25 percent of GDP, which will be devastating for this country.
In discussing President Obama’s recent debt speech, Hassett believes that Obama is content on developing an intrusive government to the point where he was willing to nationalize an auto manufacturer.

“President Obama’s speech was the most un-collegial, horrific speech I have ever heard.  Obama put together a budget that did nothing to hold down debt.  Then he puts Paul Ryan in the audience…and then insults him.  It was venomous.  I think Obama has lost it.  He has no desire to move forward, and has no view on how he’s going to decrease the deficit,” said Hassett.

Hassett said he has a theory about why Obama delivered the speech he did: “Obama lost it because Paul Ryan is everything Obama said he was when he ran for office in 2008.  Now he’s obsessed with Ryan, and in a creepy way.”

Hassett noted that while Ryan is a Congressman, he is a former “policy guy” who understands economic issues.  He thinks Ryan’s plan works for many issues.

As for Medicaid, Hassett likes the Ryan approach, whereby states are given a block grant that allows them to spend the money any way they want on health care for the poor. This will force states to be clever about how they control costs.

Ryan rightfully goes after the Obama approach to Medicare for creating an independent panel to set national healthcare policies.  Ryan’s plan gives consumers a $15,000 subsidy that they can use to buy private health insurance.  Ideally, insurers will compete for consumer dollars and hold down costs.

“You know, Obama started off by playing Mr. Cool, but now we find out who he really is.  He is just another Chicago politico,” said Hassett.

As for the 2012 election, Asbury reminded listeners that a recent survey indicated that 44 percent of voters will not vote for President Obama under any circumstances.

Hassett noted that the current GOP slate of candidates is hard to handicap.  He anticipates that a governor will rise to the top, as they have during past elections.

He is a big fan of Pawlenty and Daniels, and thinks that Bachmann could be a contender even if the media portrays her as “a ditz.”  She’s a tax lawyer and people will be surprised how smart she is.”
He thinks Trump could be a serious candidate, and he thinks Romney could make a good President, but thinks Romney will have a hard time distancing himself from the healthcare bill he passed in Massachusetts, which many people think looks like ObamaCare.

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