Is Big Government Stifling The American Spirit?

Phil Gramm (left) and Arthur Laffer argue for the motion i i

Phil Gramm (left) and Arthur Laffer argue for the motion "Big Government is Stifling the American Government" in an Intelligence Squared U.S. debate on Oct. 26 at New York University's Skirball Center for the Performing Arts. Chris Vultaggio hide caption

itoggle caption Chris Vultaggio
Phil Gramm (left) and Arthur Laffer argue for the motion

Phil Gramm (left) and Arthur Laffer argue for the motion "Big Government is Stifling the American Government" in an Intelligence Squared U.S. debate on Oct. 26 at New York University's Skirball Center for the Performing Arts.

Chris Vultaggio

Coming Up

On Nov. 10, a group of experts will debate the motion "Afghanistan Is A Lost Cause"

With Americans losing their jobs and scrambling to save after declines in the real estate and stock markets, the can-do spirit that embodies this country is not as pervasive as it has been in the past.

But to what degree does big government impact American optimism? On one side, people argue that those who are creating jobs are inherently wealthier and subject to higher income taxes.

But others argue that big government has helped rescue free-market capitalism. It helped create stimulus, which in turn saved the auto industry from bankruptcy and allowed financial institutions to take less risk.

A team of experts argued both sides of the motion "Big Government is Stifling the American Spirit" in a recent Intelligence Squared U.S. debate. Two argued in favor and two against.

Before the Oxford-style debate at New York University's Skirball Center for the Performing Arts, the audience voted 29 percent in favor of the motion and 44 percent against. Twenty-seven percent were undecided. After the debate, however, 43 percent disagreed that "Big Government is Stifling the American Spirit," 49 percent supported the motion and 8 percent were still unsure.

John Donvan, correspondent for ABC News' Nightline, moderated the Oct. 26 debate. Those debating were:

FOR THE MOTION

Phil Gramm is a former Republican senator from Texas. He joined UBS Investment Bank as the vice chairman in December of 2002, after serving 24 years in Congress, 18 as a senator. During his time in Congress, Gramm authored many landmark bills, including the 1981 Gramm-Latta Budget, which reduced federal spending, rebuilt national defense and mandated President Ronald Reagan's tax cut. As the chairman of the Senate Banking Committee, Gramm steered through legislation modernizing the banking, insurance and securities laws. The Gramm-Leach-Bliley Act repealed the 70-year-old Glass-Steagall Act, which prohibited banks, securities firms and insurance companies from affiliating.

Nouriel Roubini (left) and Laura Tyson i i

Nouriel Roubini (left) and Laura Tyson argue against the motion "Big Government is Stifling the American Spirit" at the Intelligence Squared U.S. debate on Oct. 26. Chris Vultaggio hide caption

itoggle caption Chris Vultaggio
Nouriel Roubini (left) and Laura Tyson

Nouriel Roubini (left) and Laura Tyson argue against the motion "Big Government is Stifling the American Spirit" at the Intelligence Squared U.S. debate on Oct. 26.

Chris Vultaggio

Arthur Laffer was a member of President Reagan's Economic Policy Advisory Board for both of Reagan's two terms and was a founding member of the Congressional Policy Advisory Board. He was also the first to hold the title of chief economist at the Office of Management and Budget. Laffer is the chairman of Laffer Associates and co-author of The End of Prosperity: How Higher Taxes Will Doom the Economy — If We Let It Happen (2008).

AGAINST THE MOTION

Nouriel Roubini is a professor of economics and international business at the Stern School of Business at New York University. And he is co-founder and chairman of RGE Monitor, an economic and geostrategic information service. He was a faculty member of the economics department at Yale University, a senior economist for international affairs at the White House Council of Economic Advisers and senior adviser to the undersecretary for international affairs. He also served as the director of the Office of Policy Development and Review at the U.S. Treasury Department. He is a fellow at the National Bureau of Economic Research and the Centre for Economic Policy Research.

Laura Tyson is the S.K. and Angela Chan Professor of Global Management at the Haas School of Business at the University of California, Berkeley. She served as dean of London Business School from 2002 to 2006 and as dean of the Haas School from 1998 to 2001. Tyson is a member of President Obama's Economic Recovery Advisory Board. She served in the Clinton administration and was the chairman of the Council of Economic Advisers between 1993 and 1995. And she served as the president's national economic adviser between 1995 and 1996.

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