Rubin Warns of 'Terrible' US Fiscal Situation

Robert Rubin, former US Treasury Secretary, talks about his role in balancing the US budget under the Clinton administration. He thinks present-day politics and tax cuts under the Trump administration have exacerbated the country's fiscal state.
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[@eddiefigueroa9080]

“Tax cuts” caused the $34T debt. No mention of Brrrrrrrr whatsoever. GTFOH.

[@raevj]

Government spending with NO BUDGET causes the debt.

[@rickm.hamburglar5232]

2 things can be true at the same time.

[@adamknowswhatshappening]

I saw "Bloomberg" and "Trump admin" and knew exactly what this was going to be. I also knew in 2017 Trump would be scapegoated for what I knew then. They are crashing it on purpose.

[@BrianHeimbuecher]

@@rickm.hamburglar5232 Yeah, but this ain't one of those times....

[@Quantitative_Teasing]

Exactly.

[@slovokia]

The irony is that when Mr Rubin was Secretary of the Treasury US government debt to GDP was 65%. Now it is at 120%. If we were worried about our fiscal situation then, we should be absolutely terrified now.

[@coreyleander7911]

Slovokia

[@user-xq1wz3tp5z]

The concern Now is we do have high fiscal stimulus while the central bank is attempting (with notable success) to turn around the inflation. During the Clinton Admin the concern Was that going forward, we needed to be prudent. Bob Rubin and company successfully ran a strong economy after demonstrating fiscal discipline... and gifted the W. Bush Admin a 'nest egg' of a nice fiscal surplus, going forward (which W. Bush abandoned, guided by Cheney's 'knowledge' that 'deficits don't matter'). Bob Rubin got fiscal & monetary policy in cooperation. '@slovakia' is correct that QE set very bad stage ... this was largely due to Mitch McConnell's determination to sabotage Obama, by limiting fiscal stimulus. Thus, we had bad monetary policy in effort to stimulate, in conflict with inadequate fiscal stimulus. Then Trump does modest fiscal stimulus combined with unnecessary tax cut during low interest rates from QE, followed by pandemic fiscal stimulus. Then Biden ignores Larry Summers' advice that his vast initial stimulus will risk inflation, which will preclude necessary targeted stimulus later. Excess stimulus is only needed in recession, this is current apt advice from both Rubin and Jamie Dimon. Economic policy needs bipartisan cooperation, and fiscal cooperation with monetary policy.

[@effexon]

US is like italy then.

[@PopulismIsForBottomFeeders]

Thanks Donnie. 🙄

[@romeo20maypole68]

All modern financial books / exams refer to the US government as Risk free, an RF asset class. Will that material have to be re-written?

[@robmcguckin7605]

Why don't they bring all of the central bankers on for individual interviews? You know, the same people who all flew to Omaha for that weekend group huddle about 3-4 month's ago.

[@mickygarcia4251]

Obfuscation is the plan.

[@jjssjklmnop]

I call out his tax BS. Decreasing taxes grew the economy. The enlarged economy was able to pay more taxes than before.

[@Mimi-fo7kp]

Rubin is vastly overrated. He held government position during 90s economic boom and got unwarranted credit. After that he held exec position at Citi and only enriched himself.

[@user-xq1wz3tp5z]

Bob Rubin's disciplined Guidance enabled the Clinton Admin to drive a successful economy. Unlike most of us, Rubin has talent to make money (even without computers), wherever he goes. His career at GS was when he made $. The Clinton admin could easily have had a mediocre economy, and easily handed W. Bush(41) a significant Deficit and increased Debt! BE THANKFUL for occasional Good Governance.

[@user-xq1wz3tp5z]

Edit -- ought have specified "Bush(43)" !

[@shoopddawhooped]

He also only enriched himself during his tenure where he steered White House to make economic decisions that would line his pockets as he played American taxes against UK policy. While taking credit for the bull market that was actually started by inventions of derivatives, complex financial products, and the WTO.

[@shoopddawhooped]

@@user-xq1wz3tp5z you don't even know what you don't know.

[@Anthony-dj4nd]

Talked about nothing for 20mins😮‍💨

[@royprovins7037]

Just a couple of democrats patting themselves on the back

[@DBGE001]

This is the problem of American politics on a Federal level. It's like a sports game where your team can do no wrong, and you spend your time criticizing the opposite team and the decisions of the referee. Everywhere else in the world, people spend there time criticize the people they voted for, because they want to see the promises been delivered. In the States, the later is also done on local level, like (almost everybody) hates the mayor. @@royprovins7037

[@Antron7000]

@@royprovins7037 well duh, they didnt give away 3 trilly like previous admin

[@slovokia]

One possible reason that market interest rates were low in the face of high debt levels and high deficits could be the practice of quantitative easing by central banks. They essentially bought long term government debt and financed it at the short market rate (which they unilaterally control). The expansion of their balance sheets underwrote the expansion of government debt. Clearly that process cannot continue ad infinitum.

[@Quantitative_Teasing]

I’ve wondered the same thing. Obviously the relief valve is the currency but US has reserve currency so it’s always a strong backstop. Any other central bank does the stuff fed was doing from 2008 onwards with their balance sheet, currency would plummet to zero. Exception being Japan but they have seriously impressive amount of foreign reserves.

[@adek2989]

Economic effects of money and resources to Ukraine and Israel. No mention?

[@patrickpontee7985]

So what did they do, print enormous amount of money for their interest pals !

[@1stlast290]

How about not sending billions overseas and keeping taxes down.

[@thomaszinecker1785]

The title of this upload is more exciting than the dialogue.

[@lakeguy65616]

talks about his role in balancing the budget and fails to mention Newt Gingrich? Budget bills originate in the House of Representatives as required by the Constitution. Balancing the budget was and is a Republican issue. Clinton went along with it because Newt Gingrich forced him to....

[@objectivethinker3225]

💯 correct.... And even though Clinton and Gingrich fought it out on policy, they met for lunch every single week.

[@johnmiller5629]

Bingo! Rubin is the second revisionist I've heard this week who claimed that balancing the budget was a Clinton policy and achievement. The fact is he was forced into it by the Republicans after his 1994 election debacle. Of course, none of this changes the reality that changing the financial environment such that the USG is no longer sucking vast amounts of liquidity through debt issuance ultimately flooded the system with ready cash leading to the GFC. The again, who really could have seen that coming?

[@user-xq1wz3tp5z]

We have abundant evidence about the Clinton Admin that Bob Rubin was a key participant guiding Clinton to be fiscally disciplined; assistant/undersecretary of Treasury J. Bradford deLong has commented that the determination to maintain discipline (they handed W. Bush a surplus), colored all of Clinton policy. > "Balancing the budget was and is a Republican issue." That was valid, prior R. Reagan. Cheney concluded that Reagan proved 'deficits don't matter'. W. Bush(43) cut taxes, abandoned treaties, spent(borrowed) fortunes on falsely 'justified' Iraq invasion. Trump also cut taxes. Gingrich is not without some merit, but his obstruction of Clinton foreshadowed McConnell's sabotage of Obama (restricting Obama fiscal stimulus forced Bernanke/Yellen to prolong QE to disastrous effect).

[@astrogumbo]

Bags under eyes.... somebody doesn't sleep well nowadays

[@andreww2319]

he is 85 years old ... let's see you post a picture at that age.

[@bog6106]

A system that is run by the corporations and for the corporations will only have.......corporations. Think about it.

[@glennnielsen8054]

It is a good honest dialogue about the financial situation, how liberating it would be if state leaders had the same approach to that discussion.

[@epid3mic_3p58]

honestttt??? lmaoo you cant be serious

[@glennnielsen8054]

@@epid3mic_3p58 Yes, I always try to be well-considered and receptive to good arguments if someone thinks I'm wrong. In this case there is none.

[@hongolloyd8728]

His pockets are full, you'll be fine.

[@Elliott_Wave]

Musical chairs, buy bitcoin.

[@DaleyRush]

Lol

[@vikasgupta1828]

Thanks

[@docbrown7513]

I am absolutely certain the government can deal with any issue it puts its mind to, until it can't. So the question is really, what are they hiding in plain sight? Is this just going to be about billions for billionaires and tax cuts for the rich all over again?

[@charliebrown1435]

Who gutted Glass-Steagall and black listed Brooksley Born for cautioning against repelling the important Act?

[@DBGE001]

The roof in on fire.

[@victorsempiana7099]

This guy talks with folk tongues, , he was apart of the 2008 crisis

[@haikubop9606]

Is't this the guy who led the charge to kill Glass/Steagall?

[@LivingWithGout]

Save save save. Let’s save our way to prosperity.

[@condor68y1]

Smart man. The writing is on the wall. Cut defects by cutting spending. Government is out of control.

[@jamesgraham5470]

We have wasted so much money on stupid programs that only helps their donor's

[@astrogumbo]

fiscal hawk in the theme.....LOL wut the #### eva

[@blankjohnson6934]

Really suspicious how everyone and the Media are so critical of Donald Trump.

[@vazaruspaytonas7017]

They keep blaming "the government" the same government they get 70 percent of there business from. You care about government spending then stop charging the government ridiculous amounts of money for good and services. Just playing everyone. Disgusting.

[@helpme100]

No parties!! But im interested in the conversations !!

[@rickhayes-oh2zm]

Look at the money supply chart.

[@trailguy]

It was right about when Clinton took office when public investment had as much positive effect on the gdp as it cost. Before that, building roads and bridges actually made us more than they cost, and now, paying for all kinds of programs return us about 1/3 as much as we spend. We need to get the debt to gdp ratio back to a reasonable level.

[@phil20_20]

What are you trying to say about our crumbling infrastructure? That makes no sense whatsover.

[@bps7209]

@@phil20_20we have built way too many roads and highways here in the US, probably one of the largest mistakes ever made. The IRA will cost our grandchildren well past 2050. It’s now said it will be more costly than the New Deal during the Depression in today’s dollars with inflation figured in. So, the comment makes perfect sense.

[@Zero11_ss]

Clinton actually had a surplus, its funny how you guys keep making up all kinds of stuff. Bush got us into 2 oil wars and trump increased the debt by so much.

[@chrispaul1117]

he is favor of bigger govt take a hike

[@TallTiger11]

This guy should be in jail.

[@georgekush349]

If the 10yr is savagely waking up to fiscal recklessness why has the yield curve been inverted this entire hiking cycle?

[@georgekush349]

Also what’s the empirical evidence that higher debt to gdp leads to higher rates? Last time I checked Japan has negative rates

[@calisurfin]

@@georgekush349Japan is raising rates this year. Not sure if you are paying attention to the news or if you have your head in the sand.

[@fracta1organism]

notice that rubin is concerned about "business confidence" through fiscal austerity. in other words, making workers insecure with minimal social safety nets so that they will submit to the business class at lower wages. and to whom does the govt owe its "debt" when it creates its own currency? are you too stoopid to figure that out?

[@user-xq1wz3tp5z]

It is true that USA has seen much increasing worker insecurity: see Jacob S. Hacker's 'The Great Risk Shift'. Do Not associate Bob Rubin with that. Rubin and Jamie Dimon are both prudent bankers, and both promote finance that will expand the economy Without Crises.

[@adek2989]

Talks about productivity gains under Clinton. But none of those gains went to workers.

[@rickdavies4801]

What are you saying. Put more problems on the people by taxing more .You are part of the problem. Wake up sir

[@hotchihuahua1546]

I am not an economist but I do look at the stock market and job reports ! The numbers can be manipulated by an administration to some extent , the jobs report may be favorable with people holding two jobs to stay above water ! The current rise in the stock market is due to past history, before an election year , in anticipation of lower interest rates by the Feds . Just in time for the November election by this administration to get votes !

[@tyharbour5268]

Thanks

[@gosmarte669]

Really? I thought the stock market was based on speculation on the future ?

[@Zero11_ss]

That isn't how the jobs numbers work, they also report % of working age people who are working and other stats.

[@markluckenbach5844]

Hey, hey, what happened to all of these financial‘geniuses’ ensuring folks that quantitative easing (money printing) was A-ok? And that increasing the debt ceiling every year was nothing to worry about? Clowns. Now warning of an upcoming financial crisis.

[@cavevendit2649]

Lots of evidence here that Rubin is not fully informed.

[@jawedz]

this guy is just scaring people. the risk of debt and defecit is not big.

[@S62r]

Today we unsustainable deficits and lack of public investment

[@astrogumbo]

Lookie lookie who it is

[@astrogumbo]

05:06 heavily informed......or rather PICKED

[@helpme100]

16:33 taxes

[@astrogumbo]

10:00 bob gives the lowdown on the techno utopia of wall street and silicone valley.....this "merger" has been planned for some time

[@rickhayes-oh2zm]

Was he there for the financial crisis probably

[@astrogumbo]

the better mousetrap....david you subtle ####

[@kjkgood]

whats wrong with tax cuts Robert ? the government uses the money ? no thanks always like your work but get vow adding taxation just top it

[@ianwhitehead7247]

Why do they need to talk so fast

[@suddentwist]

You don't create deficit in good times so you can prepare yourself for bad times. Aside ideological bias, this appears as his timid way to say we are in serious trouble.

[@markluckenbach5844]

Buy gold. Turn your 401k that’s been borrowed against for years (and will ultimately collapse) into physical gold and stock up

[@thomasjamison2050]

When the world ends, someone is going to get stuck with a monstrous tab to pay.

[@phil20_20]

The Russians and the Commies, and they'll be bent over by the goat herders for it.

[@davidkennedy8929]

At the end of the day nobody will pay the bill, it will be brought to zero and started again, how can you pay something that is impossible to pay!

[@thomasjamison2050]

@@davidkennedy8929 I was reflecting upon John Maynard Keynes comment that 'in the long run we will all be dead.'

[@davidkennedy8929]

@@thomasjamison2050 Okeedokeee, misunderstood your post.

[@colinhowell2777]

Every statement he made in the second half of the interview addressing the current fiscal situation was simply political speech masked as economic speech. Message: Biden good Trump bad - I'm not fully on board with Trump, would have rather seen Desantis make a push for the nomination but to imply that Biden has actually done a good job reigning in the deficit is nonsensical.

[@8ofwands300]

Are you arguing with the fact that Trump's tax cuts raised our national debt by nearly 8 trillion? 😳

[@colinhowell2777]

@@8ofwands300 post Clinton every president left office with the debt and deficit in worse shape than they found it - that bridges both parties. But that doesn't change the fact that in the interview Rubin was obviously shilling for Biden with a laughable attempt at making it appear he's simply an economist dreadfully concerned for the fiscal future of the economy and therefore country - which he should be - he's not lying with the numbers - just the politics

[@trails3597]

Business should pay in taxes what Biden did for the economy.

[@Antron7000]

you dont gotta like biden but trump lowered rich tax, printed more and gave away 3 trilly. yes biden sucks.

[@jrstsb1353]

Damn he's old, too bad money can't buy youth. Good thing most of these guys have little time left.

[@hamprepper]

i miss these times when we had folks who had America First (I'll take Bill Clinton over any Bush _ Coming rom a MAGA Conservative!)

[@astrogumbo]

Damn son....just like daddy Kissinger..... looking bad

[@astrogumbo]

was 93 your breakout year Rob? LMAO or was that the year David was initiated (gets caught up in a hypnotized LOOP) and becomes a joke to the history observer IN 2024?

[@kjkgood]

any who cares about IBanks opinions Robert ? gee they are not biased are they

[@rickhayes-oh2zm]

93 lets talk about 99 2000. When the economy got a beating. wear your clowns suits ok.

[@astrogumbo]

david touts deficit reduction and thus far shuns away from graham leech bliley

[@rickhayes-oh2zm]

What year 2000 crash Greenspan raised rates 1.75. What year was this clown hired.

[@deanfaklaris9987]

He is so completely full of sh!t. Taxes are going to fix our $34 trillion dollar debt that is growing by $1 trillion per quarter? Can anyone provide any model that explains how this could possibly happen?

[@highthereguys]

sounds reasonable till he just regurgitates all the dem talking points then you realize oh wait hes a bias partisan

[@DaleyRush]

Brrr...

[@jarirutanen8762]

The US gov is a monopoly issuer of dollars mostly in the form of treasuries that pay interest and thus can never run out of them. The interest payment is voluntary and should be abolished, it is just a wealth transfer from the gov to the rich.

[@barryross6100]

How can such a smart man be so misinformed???

[@seanburton5298]

It is very important to hear what this man is saying. This channel is also a Republican influenced channel.

[@rickhayes-oh2zm]

powell hero is volcker. it should be allen greenspan

[@feleciawallace8420]

Trump - is not the correct person for the job next year...

[@fredgarvinMP]

He's gonna be the nominee and Biden's got to go.

[@bps7209]

Really and Biden is? 😂

[@eternalskeptic]

"There is nothing to fear but fear itself!" -The Greatest U.S. President F.D.R.

[@royprovins7037]

Tell that to the Japanese in the internment camps

[@jakw97]

FDR was the best US president, im lost for words. The new deal was not a good thing, its was a bad one.

[@lokesh303101]

Raise the Taxes in DownTowns for all Businesses.

[@rickhayes-oh2zm]

Now he is helping the everything crash. Right economists. That is why he works for govt. because he doesn't know anything about economics.

[@LetsGoBrandon4U2]

R.Rubin sounds like Greenspan, J Diamon,... NOT A COMPLIMENT

[@adek2989]

Who’s weaponizing Justice? FBI? And I voted for Biden in 2020 and every Dem before. But nothing trickles down. Except to Ukraine and Israel.