Watch CBS News

KCBS In Depth: The Economy

(KCBS) – It has been a wild economic ride over the last week, with the Dow Jones seeing near historic ups and downs. The uncertainty not only in the United States, but around the world, has left many economists scratching their heads.

UC Berkeley Professor of Economics and Law Alan Auerbach has been watching the situation closely. He said a change in the tax structure could be on the horizon.

KCBS Interviews UC Berkeley Economics Professor Alan Auerbach:

"We need money," Auerbach said. "And if the alternative is to raise tax rates, most economists would say it's better to limit these tax benefits because it's less damaging to do that than to raise tax rates."

Professor Auerbach, who also is the Director of the Robert D. Burch Center for Tax Policy and Public Finance, said the U.S. may need to take a worldview approach.

"Perhaps the simplest approach would be to adopt a value added tax as virtually ever other developed country in the world already has done," he said.

Auerbach is also a finalist to be the next Chief Economist on the White House's Council of Economic Advisers.

He said the voters in this country, while extremely knowledgeable for the most part, may not have all the information needed to make informed decisions.

"Many of them are very well-informed on the issues," Auerbach said. "Unfortunately, even those who are well-informed on the issues face serious political constraints on what they can do, not only within Congress, but also at home."

He said one of the keys will be to have a more open discussion on what this country is facing economically.

"Any candidate who promises you a free lunch is someone who should not be listened to. Look out for people who are being vague about what they are promising," he said. "We need specific discussion of what candidates are going to do and the more information we have, the better."

Something that will certainly be up for debate in the coming months.

You can hear KCBS In Depth, a weekly half-hour news interview, Saturdays at 5:30a.m. and Sundays at 8:30 a.m. and 8:30 p.m. on KCBS All News 740AM and 106.9FM.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.