Dr. Powell Talks U.S. Debt, Stimulus Bill Problem, & Minimum Wage
Thursday on KFYO Mornings with Dave King and Matt Martin, Dr. Ben Powell, Director of the Free Market Institute of Texas Tech, joined Dave and Matt to talk about the United State's massive debt, what needs to happen to our economy, Texas and other states opening up, tax increases, unemployment, minimum wage, and more.
The conversation started when Dr. Powell was asked what he thinks about the $30 trillion debt that the U.S. has gathered. Powell said that he thinks it is a huge deal, one that has been building for over 20 years, and one that affects everyone, Republican or Democrat. Ben explained that during the Bush administration, the deficit soared, then it got worse and worse under Obama, then Trump doubled down on the problem, and finally the pandemic caused many problems that have now kicked off the $1.9 trillion stimulus bill. Powell said,
They're spending like there's no consequences to it, and we're accumulating all this debt, and ultimately, that has to get paid for by either future taxes, or inflation. Neither one of which is going to be good for economic activity. It's really hard to grow your way with a growing economy out of this much debt.
Dr. Powell said that for this to end, we would need to provide a friendly environment for economic activity and coordination, but without accumulating any more debt, but that is not where we are headed right now. He went on to say that while he is happy with some decisions being made right now, such as Texas being opened back up, that ultimately with other states being closed, as well as this $1.9 trillion spending stimulus bill we will not see much stimulating of economic growth. Powell went on to say that he thinks that such a stimulus bill is unnecessary because, while many have had problems during this pandemic, savings have skyrocketed for many Americans who have been unable to go out and spend money.
Another question that Dr. Powell was asked was what the proposed tax increase would look like for the US, before the economy even gets up and running again. Powell explained that all this spending is government debt, and therefore future debt for the people, and a drag on the economy where businesses will have to look forward and take on the burden on themselves. On top of this, Powell said that it will also be a discouragement on citizen's general economic activities if taxes are going up.
Finally, Dr. Powell talked about unemployment money and minimum wage. Talking about unemployment, Powell said that he thinks it is a problem, because if you pay people not to work, they will not work, and if you raise unemployment money too high, it could look more appealing to those who are not making enough as is. When asked about minimum wage, Powell said that he thinks that there should not be a minimum wage at all, let alone a raise to $15 an hour. He went on to say that if a $15 minimum wage was put in place, it would reduce lower skill labor and make low productivity workers lose their jobs.
Listen to the full interview with Dr. Ben Powell in the audio above.