Feldstein: Bond Vigilantes Could Definitely Come Back

The transcript discusses the misconceptions about Reaganomics, explaining dynamic scoring and its impact on tax policy. It compares the governance styles of Ronald Reagan and Donald Trump, highlighting Reagan's experience as a governor. The role of Congress in shaping policy under Trump's administration is examined, with a focus on the potential influence of a Republican majority. The discussion concludes with an analysis of market checks and the concept of bond vigilantes, considering their impact on interest rates.

What was a significant achievement of Reaganomics according to the transcript?

• A large fiscal deficit

• A very small fiscal deficit

• Higher tax rates

• Increased government spending

What does dynamic scoring suggest about tax cuts?

• Tax cuts have no impact on the economy

• Tax cuts can change taxpayer behavior and affect revenue

• Taxpayer behavior remains unchanged

• Tax cuts always lead to a 10% revenue loss

How does Ronald Reagan's political experience differ from Donald Trump's?

• Reagan had no political experience

• Trump served as a governor

• Reagan served as a governor for eight years

• Trump had extensive political experience

What is speculated about Trump's approach to his presidency?

• He will focus solely on international issues

• He will follow Reagan's blueprint

• He will ignore past presidencies

• He has a clear set of policies

What role is Congress expected to play in shaping policy?

• Only a supportive role

• No role at all

• A dominant role

• A minor role

What are bond vigilantes expected to do if fiscal responsibility is not maintained?

• Cause long rates to move up

• Remain inactive

• Support government policies

• Lower interest rates

What is the potential impact of a lack of gridlock according to the transcript?

• Increased stability

• Path to instability

• No impact

• Decreased political influence