I missed this interview on TV last night.
Elizabeth Warren posted on Facebook about her interview.
Last night, Conan O’Brien and I talked about how we’re demanding some real accountability from the big banks that broke our economy.
This is actually part 2 of the interview. Part 1 is also interesting.
What is in part 2 is a very valuable part of the discussion, but I wouldn’t want you to listen to both parts without understanding what I have to say below.
At the beginning of Part 2, Conan O’Brien starts off with the comment:
I studied history, I studied literature, I never studied economics and I regret it because there is so much now that I feel I would have a better understanding of, but … .
As I heard him say this, I was thinking economics is not what you want to ask Elizabeth Warren about. She has many of the same misconceptions about the topic that Republicans (and some other Democrats) have.
In part 1 of the interview, they start a discussion about student loans. Elizabeth Warren talks about the $66 billion dollars in profit that the government makes on student loans. Her bill would eliminate that profit. Conan O’Brien then says about the $66 billion that the government should not be making in profit “Obviuosly the money has to come from somewhere” and they get into discussion of her plan to “pay for it”.
This is where they descend into the weeds of both of them misunderstanding economics, or at least misunderstanding money and government budgets. It is not at all “obvious” that the money has to come from where they think it does.
They both could stand to have read two recent posts out of the many that I have written on the subject. The two recent ones are The Fed Could Have Also Helped Main Street Instead of Just Wall Street and When Will the White House and OMB Ever Learn About Sector Financial Balances?. I hope that if I keep pressing this issue, eventually this knowledge will seep into the minds of the public. Then the public will force the politicians to learn about this, too.