J.D. Foster

Former Senior Vice President, Economic Policy Division, and Former Chief Economist

Dr. J.D. Foster is the former senior vice president, Economic Policy Division, and former chief economist at the U.S. Chamber of Commerce. He explores and explains developments in the U.S. and global economies. 

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Two Senators Found an Unlikely Source for a New Path to the American Dream

Senators Warren and Sanders have discovered financial success from the written word.

New Tariffs Threaten to Torpedo America’s Economic Resurgence

The administration should pursue thoughtful actions that address unfair trade practices for American businesses in global markets.

Of Crumbs and Fancy Cake: Nancy Pelosi’s Take on Tax Reform

A big benefit is just on the horizon in the form of a stronger economy, with jobs more plentiful and wages rising.

What Do Trade Deficits Really Tell Us About the Economy?

What causes trade deficits? Whether bilateral, aggregate, short-term or long, understanding their causes is essential – whether they are harmful or not, whether they are the product of bad domestic policies or unfair foreign trade practices, or whether they are just a feature of a global economy much like temperature is a feature of the climate.

Tax Reform Could Be An Answer To The Fiscal Nightmare Left By Obama

The CBO recently released its annual nail-biting review of the nation’s fiscal future under current policy. Bottom line – it still stinks.

The State of the U.S. Economy – Past, Present, and Threats to the Future

The relief provided by President Trump's regulatory actions should give businesses the confidence to increase investment.

Incentives Influence Behavior, and Tax Rates Certainly Influence Incentives

Former President Bill Clinton recently said some interesting things about corporate tax rates.

Family Incomes: An Island of Encouragement in an Ocean of Disquiet

Before we start streaming old versions of “Happy Days are Here Again,” let’s look closer at the recent Census report.

Forrest Gump’s Lieutenant Dan Faces the Inequality Conundrum

Just as President Obama's "Fairness Economy" doctrine hasn't made a dent in inequality, neither will Clinton's proposed policies.

Chamber's Regalia Puts Microscope on Federal Reserve’s Regulatory Approach

Much of what passes for regulation today in the financial sector cannot be described as good by any reasonable measure.

Retreating From International Trade Is a Losing Proposition

The presidential candidates seem to agree on only two points: First, the economy’s overall poor performance; second, a distrust of free trade’s benefits. They then err in blaming the economy’s poor performance on international trade, concluding the solution is to “fight back” with trade barriers. This strategy is shortsighted, fear based, and self-defeating. The smart strategy is to fix U.S. policies weakening the economy, such as tax and regulatory policies; negotiate strong trade agreements leveling playing fields while opening up new avenues of competition; and then compete to win.

The Administration Spins the Budget Deficit

The federal government ran a budget deficit of $439 billion in 2015, and that’s supposed to be good news according to the president and his cheerleaders.  In his recent State of the Union address, President Barack Obama said the deficit had been cut by “almost three-quarters” (the actual figure is 69 percent, but let’s not quibble). 

You Can’t Sugarcoat the Facts: Taxes Influence Behavior

Taxes influence human behavior.  On the surface this would seem one of the few statements on which universal agreement prevails among economists and quasi-economists alike.  But for some, the agreement is occasional. One might even say it’s a matter of convenience.

Getting Reconciled to Reconciliation’s Limitations

The budget resolution adopted by the U.S. Congress in May of this year on largely party-line votes included specific reconciliation instructions for future actions.  The reconciliation process is a powerful tool for accomplishing difficult fiscal policy tasks, but it also has its limitations.  Many members of Congress appear to be highly enthusiastic regarding reconciliation’s possibilities in 2015.  They are likely to be disappointed.

Reconciliation in theory

Yellen Should Tell the World Bank, ‘Sorry, No’

The United States Federal Reserve will at some point begin to normalize United States monetary policy, first by initiating a series of increases in the Federal Funds rate. The timing of the first such increase is highly uncertain but has been widely anticipated to occur this month. Numerous voices have been raised within the United States for and against such a move.

The Continuing Saga of America’s Manufacturing Doldrums

The recent story of manufacturing in America is a curious one, but oddest of all is that even six years and counting after the recovery began manufacturing has yet to recover its previous level of activity.

Mid-Session Review Contains More Bad News than Good

The administration rolled out its the annual update to the president’s budget as required by law. As usual, it provided the typical rhetorical spin expected from any administration -- and included a mix of good news and bad.

With Disability Insurance, the Curtain Rises on the Entitlement Reform Era

Disability insurance is a complex business, and it takes a long stretch of the imagination to believe the federal government could ever do it well, but try our best we must

Elemental Deduction: The Yin and Yang of Tax Policy

What The Economist gets wrong about tax-free debt, specifically the interest expense deduction for homeowners with mortgages and businesses with debt.

A Retirement Penny Saved Is a … Tax Expenditure?

If a tax provision allows a dollar of wages earned today to escape tax today, that provision is classified as a tax expenditure. But what if that same dollar is taxed tomorrow? What if it’s taxed tomorrow with interest?

International Tax Fix for Highways Headed Down the Wrong Road

I would like you to pay my mortgage.  No, really.  In fact, being all powerful, I’m going to pass a law requiring you to pay my mortgage.  If you don’t think that’s fair, if the prospect of you being forced to pay my mortgage makes you a little hot under the collar, then you can appreciate how U.S. multinational corporations feel.

On Free Trade and Overage Ballplayers, America Gets It

Trade barriers at home and abroad cause us and our trading partners to be less efficient, less productive with our resources. Imagine passing a law that says 50-year-old men and older get priority playing professional baseball.

Reports on Jobs and Income: American Families Aren't Feeling the Love

The economy is creating jobs at a steady pace and the cumulative totals sound impressive until you remember how deep the hole was out of which we are climbing and how long we have been climbing.

U.S. Chamber Quarterly: Comprehensive Tax Reform Is All About Growth

With every passing year, the need for comprehensive reform grows, and the price we all pay for delay rises.

Seriously? Secretary Lew Claims Obama’s Economic Critics Have Been ‘Proven Wrong’

Fantasy? Delusion? A wry if misplaced sense of humor? Hard to say, but what the facts prove is that, unfortunately, the critics were indeed right.

The Many Problems of Funding Highways and Transit with a Repatriation Shakedown

Washington rumors suggest enduring if not growing interest in an odd couple proposal to link a new tax on corporate repatriations and funding the federal highways and transit program.

A State of the Union Address from the Commander-in-Chutzpah

A truly strong economy is the key to an economically prospering middle class, and here the verdict truly is clear – the President’s policies have not produced.

Congressman Van Hollen Doubles Down on Bad Tax Policy

What do you do when everything you’ve tried fails? When you run out of alternatives, you double down on what failed, right? At least, that’s the most sensible interpretation of a tax proposal announced recently by Congressman Chris Van Hollen, the ranking Democrat on the House Budget Committee.

Cheers Over Falling Oil Prices Blur The Real Economic Story

Is the recent drop in crude oil prices a boon for the economy? One might think so from the way some commentators are responding to the halving of crude oil prices in recent months. But that's only part of the story.

Delayed Joint Committee's Analysis On Obama Proposals Far From Taxing

The Joint Committee on Taxation released its annual “Description of Certain Revenue Provisions Contained in the President’s Fiscal Year 2015 Budget Proposal” on December 17, one day after Congress declared sine die, which is Congress speak for “we’re out of here!” Why the nine-month delay?

The Keystone Pipeline Really is Important to the US Economy

The real economic power of Keystone is as a symbol to the job creators and risk takers of America that maybe there is hope Washington policymakers may finally “get it” if just a little.

Obama's Silver Lining: He's Not Francois Hollande

Aside from White House Press Secretary Josh Earnest, just about everybody understands the Democratic Party suffered an historic defeat in this past election.  President Obama and friends are surely looking for a silver lining.  He can find one of sorts across the pond.  

How Close Are We to Healthy Labor Markets?

Employment numbers have finally recovered their prerecession levels, and the September unemployment rate at 6.1% approaches levels normally associated with “full employment.” Other indicators, like initial weekly unemployment claims around 300,000, also suggest a stronger labor market. Still, other indicators suggest that labor markets are far from healed. For example, the number of long-term unemployed remains very high, and real labor compensation growth has been almost nonexistent.

White House Inversion Misinformation Campaign in High Gear

According to an online presentation posted at whitehouse.gov, “When corporations invert and pay less in taxes, other working Americans have to pay more to help fund the services we all rely on." This is simply not true, and it is only one of two such misleading statements in the presentation.

Labor Gains and Labor Pains

Today’s labor market presents economists and policymakers with two great questions. The first is whether, and why, the unemployment rate is now something of a misleading indicator. The second, and far more important, is which combination of poor policies are most at fault for the economy’s laggard performance back to full employment and what can we do better.

Prospecting for Fool’s Gold in Inversion Mines

The President and Senate should to stop playing political games with the U.S. economy and start fixing real problems. The tax code would be a good place to start.

At-Risk Democrats Run from Leadership’s Preferred Inversion Solution

These transactions will continue, and U.S. corporate headquarters will continue to emigrate, as long as the U.S. corporate tax rate remains so far above that of our major competitors, and especially so as long as the U.S. imposes the most punitive tax system on companies’ foreign earnings.

CBO’s Inconsistent Treatment of Expiring Tax Provisions – Next Chapter

It may be inconsistent in how it treats different expiring revenue provisions, but sometimes it gets it right.

Europe’s Leaders Surprised at Their Success at Risking Deflation

If the ECB’s new policies are not substantially and quickly effective in nudging inflation upward, then those who whisper the eurozone currency crisis is over may yet be in for quite a surprise.

Fed Remains Short-Handed as Majority Leader Reid Plays His Games

The Federal Reserve Board is still missing some members, the U.S. Senate is still fumbling toward confirming the president’s uncontroversial nominees, and now the problem is less Republican senators’ principled obstructionism than Senate Majority Leader Harry Reid playing his little Senate games. 

Destructive Tax Inversion Delusions in Lieu of Solutions

The United States has a growing problem – well, it actually has many, from out-of-control entitlement spending to equally out-of-control regulatory burdens.  But most of these problems don’t make the headlines. One such growing problem has made the headlines lately – increasingly the United States’ biggest companies are choosing to become economic emigres.

Bush’s Kennedy Award Rings True for Ryan

Last Sunday, President George H.W. Bush was given an award for courage by the John F. Kennedy Presidential Library and Museum. The award, presented in recognition of the 1991 Bush tax hike was presented to Bush’s granddaughter, Lauren Bush.

Wanted: More Jobs and Wages, Less Robin Hood

According to the initial read, the economy as measured by Gross Domestic Product (GDP) grew at a measly 0.1% annual rate in the first quarter of 2014. This exemplifies the recovery’s weakness and as much as anything probably explains the Obama Administration’s  strategic pivot to the issue of income inequality.  

Speaker Boehner and the Agitated Conservatives “Big Idea”

According to reports, a tide of frustration with House Speaker John Boehner is rising among House Republican conservatives, and revolt it brewing. So, what’s the “big idea” coming out of the conservative ranks?

Administration’s Economic Policy Magic Show Working Overtime

In the administration’s magic land where raising the minimum wage is regarded as economic stimulus, making millions of additional workers eligible for overtime seems a good way to raise incomes and perhaps even stimulate the economy, too -- were it only so easy

Jobs and Poverty, Not Income Inequality, Are the Real Issues

The nation is and should also be concerned whether incomes are rising and whether individuals in poverty have ample opportunity to raise themselves up to enjoy materially higher standards of living.

Obama’s Message for the Unemployed – Better Luck Next Year

Nearly 3 million American workers left the workforce last year. President Obama’s response? Raise the minimum wage.

WaPo Writer: Raising the Minimum Wage on Federal Contracts Is a Raw Deal for Taxpayers

President Obama has announced his intention to raise the minimum wage paid to employees working under federal government contractors from $7.25 an hour to $10.10 an hour. Unlike the President’s proposal to raise the federal minimum wage for private sector workers, this policy at least has the benefit of not destroying jobs directly as long as it is applied narrowly. After all, a higher minimum wage for workers on federal contracts just gets passed on to the federal government, e.g. the taxpayers, in higher costs. But is it good policy?

Proponents Know That a Minimum Wage Hike Means Lost Jobs

In his State of the Union address this evening President Obama is expected to call, once again, for raising the minimum wage. Proponents of this policy argue that it would materially help address poverty and income inequality, or that it’s simply a matter of fairness. Each of these arguments is highly debatable, and hotly debated.  

2014: A (Bit) Better Outlook

After too many years of anemic growth, it appears that the recovery may be gaining a little better traction. Overall growth last year probably hit 2.0% or so, even slower than the average of 2.3% since the end of the recession in 2009. We expect considerably better growth this year, accelerating to near 3.0%. This month we look at reasons for our more optimistic forecast.

Sources of Strength

A Better Approach Than the Minimum Wage Distraction

In a classic case of odd timing the Obama Administration has launched a push for a higher federal minimum wage. The timing appears odd because even after four years the economic recovery remains disturbingly weak. Consequently, the unemployment rate remains high, declining over the past year primarily because workers have simply given up and left the workforce. Raising the minimum wage can only make these matters worse.