NIGHTLY BUSINESS REPORT – The Tax Deal Short & Long Term

Fixing economic problems today and tomorrow. Glenn Hubbard has thoughts on both.

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SUSIE GHARIB: Fixing economic problems today and tomorrow. Our commentator has thoughts on both. He's Glenn Hubbard, dean at Columbia University's graduate school of business and former chairman of the Council of Economic Advisers under President George W. Bush.

GLENN HUBBARD, DEAN, COLUMBIA GRADUATE SCHOOL OF BUSINESS: It looks like we have a tax deal for the short run. What should we hope for in 2011? Thinking about the long run is back in style. There is hope. After repeated stimulus packages to revive the economy, more serious discussion is emerging in Washington about long-term structural challenges facing our nation. Stagnating wages for too many Americans, rising health care costs and large Federal deficits and debt that threaten our financial future -- these problems did not start with the financial crisis of 2007 to 2009 and they will not fix themselves as the economy recovers. The recent proposal from the fiscal commission to reduce deficits and debt offers a chance to restart long-run growth. By putting government programs on a sustainable footing and lowering future tax burdens, such a proposal helps the economy today as well. And tax reform that can help the economy shift away from more consumption today to more saving and investment for tomorrow will lower the chance of future financial crises and promote today's job creation. 2010 was another year of the short run in policy, calling to mind John Maynard Keynes' quip that, in the long run, we're all dead. Perhaps, but 2011's hopeful shift to our future brings to mind Henry David Thoreau's admonition that, in the long run, we only hit what we aim at. I'm Glenn Hubbard.