THE FLOUNDERING JEC
June 21, 2004
Rep. Jack Kingston (R-Ga.) recently proposed abolishing the Joint Economic Committee of Congress in order to save $3.9 million. As chairman of the Legislative Branch Subcommittee of the House Appropriations Committee, his proposals obviously carry a lot of weight, says Bruce Bartlett.
- The JEC was established in 1946 as the congressional counterpart to the president's Council of Economic Advisers.
- But unlike the CEA, which has 3 professional economists as members, the JEC is comprised of 10 congressmen and 10 senators, who are further divided between Republicans and Democrats.
As a hotbed of Keynesian economics, the decline of this school of thought hit the JEC hard. According to Keynesian doctrine, inflation and unemployment can't go up at the same time. So when this happened in the 1970s, the Keynesians faced a dilemma that they were never able to resolve, says Bartlett:
- That is one reason why the JEC was viewed as being expendable.
- Also, the Congressional Budget Office, created in 1974, took away much of its work in the area of economic forecasting.
These factors caused the JEC to pull together and find a new reason for being. Under the leadership of Sen. Lloyd Bentsen (D-Texas), who was chairman in 1979-80, the committee became a supporter of supply-side economics.
Speaking now with one voice on the need to cut taxes and stimulate production, rather than consumption, the JEC provided crucial support for supply-side economics at a critical moment in history, explains Bartlett.
Source: Bruce Bartlett, "The Floundering JEC," National Center for Policy Analysis, June 21, 2004.
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