Ben Stein: No Crystal Ball for Economic Rebound

Republicans and Democrats have been snapping at each other all weekend over economic issues, with the GOP pushing to extend Bush-era tax cuts and Democrats arguing to extend unemployment benefits. Each side insists its plan will provide a better boon the economy.

Ben Stein doesn't think any of the members know what they're talking about.

Stein, an economist, former presidential speechwriter, and, of course, actor , took on both Republicans and Democrats in an interview with Chris Wallace Sunday on "America's News Headquarters." He cast doubt on a major Republican talking point that keeping across-the-board tax cuts--including those for the wealthiest Americans --will stimulate the economy.

"Why lowering tax rates on the rich would stimulate the economy is unclear," Stein said. "We just don't know."

He did, however, concede that "it's never been, historically, a good idea to raise taxes in the middle of a recession."

Stein also blasted House Speaker Nancy Pelosi, who earlier this week said that extending unemployment benefits would provide a significant return investment. "This is something that is not only good for these families; it's the right thing to do in a downturn in our economy," Pelosi said at a press conference Wednesday. "The non-partisan Urban Institute estimated that unemployment insurance returns two dollars to the economy for every dollar spent."

"No, she isn't right," Stein said. "When Mrs. Pelosi claims to be an economist, it's ridiculous."

Stein said the Urban Institute, which Pelosi cited as the source of her statistics, may not be as non-partisan as the Speaker claims.

"Everybody is partisan," Stein said. "The Urban Institute--it's a fine organization, but we don't know whether their numbers are correct."

Stein said he believes in the short term the country can safely keep borrowing and that the Federal Reserve has admirably handled the economic downturn.

Ultimately, Stein said, the economic multiplier theories that members of Congress have used during these debates simply aren't certain enough for any of them to claim that either theory--extending unemployment benefits or cutting taxes--will be definitively effective at stimulating the economy.

"What we know," he said, "is that we don't know."