PAUL KRUGMAN: The GOP tax plan probably won't help the economy

Business Insider senior editor Josh Barro sits down with Paul Krugman, a Nobel Prize-winning economist and distinguished professor of economics at the City University of New York. They address the one-page sheet released by the Treasury department this past week, which argued that President Trump's economic policies - including the tax bill - will shrink the government deficit. Krugman says that the gross domestic product (GDP) growth forecast put forth was pulled out of thin air, with no backup. He notes that the projections are roughly nine times that of the Joint Committee on Taxation's forecast. Krugman says that even the most ideal policy in the world would fail to boost GDP by 7%.

Barro asks if the tax plan as proposed will boost economic growth at all, and Krugman says he's not particularly optimistic about it. He notes that many of the studies that have been done don't touch on the impact of the national deficit on growth, and says that many of those organizations are using an inexact definition of growth. Krugman says that even if GDP ends up being positive, gross national product could end up being negative.