J.D. Foster, Senior Economist, the Heritage Foundation
Biography provided by participant
JD Foster is a Norman B. Ture Senior Fellow in the Economics of Fiscal Policy at The Heritage Foundation.
Forster's primary focus is studying long-term changes in tax policy to ensure a strong economy. He also examines changes in Medicare, Medicaid and Social Security so they are both affordable and more effective.
Foster came to Heritage in 2007 after serving many years at the White House, the Executive Branch, Capitol Hill and private policy institutions. His last job before joining Heritage was at the White House's Office of Management and Budget, where he was Associate Director for Economic Policy.
While there, Foster led the office's economic policy staff and advised three Directors on developments in the economy and potential changes in economic policy. He was also the chief adviser to the Director on matters of tax policy and led the OMB team in the Administration's "Troika" economic forecasting process. In addition, he played a leading role in the development and advancement of the Administration's pension and private health care policies.
Before joining OMB in June 2002, Foster served at the Treasury Department, where he was Senior Adviser in Economics at the department's Office of Tax Policy. He also advised the Assistant Secretary on issues concerning the 2001 tax cut, the 2002 tax stimulus bill, reform of the tax expenditure presentation in the President's budget, simplification, and options for tax reform.
On Capitol Hill, he was the Legislative Director for Rep. Philip M. Crane (R-IL), then Vice Chairman of the House Ways and Means Committee. Before that, he was the Executive Director and Chief Economist at the Tax Foundation, a Washington, D.C.-based research and education institution. While at the foundation, he saw its research program and reputation restored, a variety of new education programs instituted, and its debt retired. He also was Chief of Staff to Chairman Michael Boskin at the President's Council of Economic Advisors at the White House.
Foster received his doctorate in economics from Georgetown University, his master's degree in economics from Brown University, and bachelor's degrees in economics and mathematics from the University of Colorado.
Federal Reserve Board Chairman Bernanke has gone to great lengths to affirm that he has a workable “exit strategy” from the Fed’s extraordinary actions and involvements of the past year or so. It is fair to say that he is thoroughly convinced, and so far the markets appear to be giving him every benefit of the doubt. And why not? So far, they have no reason to doubt his intentions. But the exit strategy involves a great many unknowns. And a misstep could be very painful. If the exit strategy works as advertised, the Fed will be able to whittle… Read more
Fairness Fantasies We Cannot Afford There are two abiding, grievous weaknesses to the liberal “soak-the-rich” mindset and its many variants. The first is that those so afflicted cannot bring themselves to admit these policies cause material, lasting harm to job growth and wages. With an unemployment about to push through 10 percent, to even suggest higher income tax rates at this time for whatever purpose can only be described as self-delusional. The basic mindset does not just arise in tax policy. It’s widespread. For example, Secretary of State Clinton told the Indian government they could impose binding limits… Read more
1) Much of the argument that inflation will remain subdued seems to be based on continued weakness in the U.S. and indeed the global economies. In effect, a sizeable output gap is expected to prevent price pressures from arising. This may work for a period, but the expression of “stagflation” was created specifically to describe a period when economic weakness and rising inflation occurred simultaneously. Given the unprecedented infusions of liquidity into the credit markets by the Fed and the ECB and others, should we be concerned that the output gap break won’t be enough to halt the rapid inflation… Read more
The best one can hope for is the Obama Administration will allow GM's executives to make business decisions guided entirely by the desire to return the company to profitability and private hands. Given President Obama's recent history, this is too much to hope for. Repeatedly, President Obama has made clear, sound statements of his intentions regarding further bailout funding, protecting taxpayer interests, and respect for the rule of law, only to turn around and do the exact opposite of what he declared. He has also said he doesn't want to run an auto company. Based on his own history, why… Read more
Greg Mankiw's response almost makes a very good point. "In light of the shifting baseline, it is impossible to hold the administration accountable for whether its policies are achieving their intended effects." Was there ever any question that the baseline would shift? Of course not. It might have shifted up. Instead it shifted down. The President and Chairman Romer were of course aware of the certainty of baseline shifts when they made the pledge. Accountability and transparency mean the Obama jobs pledge can only mean a certain minimum level of employment achieved at a specific point in time, both determined when… Read more
In this era of unremitting pragmatic hope a terrible jobs figure is reported as good news only because it was less terrible than the figures from the previous two months. The unfolding "green shoots" doctrine seems to be that a reduction in the rate of decline in the economy generally and jobs specifically is cause for celebration. Christina Romer has, I believe, the more sober perspective. We should certainly welcome an easing of the rate of decline as a necessary precursor to recovery, but we are still, nevertheless, contracting a speedy clip, and are unlikely to see job growth until… Read more
Americans were once again reminded during the recent tax filing system that the income tax is a functional disaster. It functions, but it’s still a disaster. And so the President’s creation of an independent commission to work on tax reform should be encouraging. It should be, but it isn’t. Not yet. President Bush had his tax reform commission under Senators Breaux and Mack. Their mandate was broad. They did excellent work. It came to naught. President Obama has already handcuffed his tax reform panel by constraining them to work within the confines of current policy. It’s not entirely clear what… Read more
The answer is – the missing letter. An L followed by a complete V. Historical comparisons are especially problematic for this recession and the recovery to follow in part because we should probably think of current events as the second of three recessions. The first recession ran from December of 2007 until September of 2008 and was fairly run-of-the-mill. The second recession began with the financial implosion in September of 2008. In the second recession, many of the forces at work in the first recession picked up additional steam, most notably the housing sector, but then the financial… Read more
Nationalization in the sense of full government control and ownership of major U.S. banks is, in my view, not inevitable, nor likely, nor would it be an effective policy response to the financial crisis. Further, additional steps on the road to nationalization are similarly unnecessary, unhelpful, and could well be counter productive. The central problem facing financial institutions is that the price discovery process is working poorly. Banks still don’t know the value of many of the assets they hold on their own books, in many cases the apparent values continue to decline, and they don’t know the… Read more
Job gains or losses are an imperfect metric for gauging economic performance, for the same reasons the group tasked with deciding when recessions begin and end consider a wider array of economic data. However, the political process and the American people are accustomed to employment data such as the unemployment rate and changes in the level of employment, and these serve reasonably well approximating the overall state of the economy, especially when referring to changes in private sector employment. This focus on private-sector employment is especially important in the context of President-elect Obama's jobs claim. This claim ought to be understood to relate… Read more
The economy is in a very weakened state, with further contraction expected for many months. So it is extremely important to focus on policies that work, not just those that are politically expedient. The centerpiece of an effective policy is to extend for at least 3 years, and preferably for a longer period, current tax policy. It will be difficult for the economy to stabilize and then recover if it must face the threat of higher marginal tax rates. President-elect Obama has indicated he intends to extend most of the tax relief enacted in recent years, but likely not those… Read more
Let's start with the observation that proponents of payroll tax holidays have already taken an important step in the right direction. Most discussions of fiscal stimulus emphasize increased federal spending. Increased spending would be utterly ineffective as stimulus because the federal government must first borrow the funds, so private spending declines by whatever amount public spending might increase. In contrast, well-designed tax relief would be effective, not because of the resulting deficits, but because of the resulting beneficial changes to economic incentives. Unfortunately, and despite the encouraging instincts it reflects, a payroll tax holidy would also be of little effect. Cutting… Read more
Biography provided by participant
