WASHINGTON — Regarding the present economic apprehensions, may
I counsel calm and good sense? As for those agitated voices in the
chorus, ululating of our dire straits and even of depression and
doom, remember they have been out there for years. Generally
speaking, they are opportunistic liberals itching for power. It is
not so surprising that their lamentations are so frequent but that
they are so monotonous, for they have yet to be occasioned by
either depression or doom. A pause here, a pause there, otherwise
the American economy just keeps growing.
At The American Spectator we have maintained a
department, the “Current Wisdom,” wherein we have over the decades
recorded the neurotic, albeit often opportunistic, jeremiads of
these prophets of doom. In reviewing these lamentations the
perceptive reader will note two things: their failed prophecies and
their unchanging bugaboos and rhetoric through all their head-on
collisions with reality. In modern times no political point of view
has been more out of sync with the facts than liberalism. Yet
somehow the liberal point of view endures, failed prophecies and
all. To the liberal jeremiahs, America is forever on the hem of
financial disaster along with other calamities. Our bellicose
foreign policy threatens worldwide cataclysm. We are destroying
habitat, impoverishing the poor, and impeding the progress of “the
developing countries” towards the happy condition of, say,
Sweden.
As this is an election year; and there are problems in the
economy — mainly in the financial sector — we are hearing ominous
forecasts from the liberals as they plot a return to the White
House. Their gruesome scenarios are chilling, but to those of us
who have kept abreast of the “Current Wisdom” through the decades,
the alarums are familiar to the point of tedium.
The other day in the Washington Post there was a report
that Senator John McCain, presumptive Republican presidential
candidate, had enlisted among his economic advisers former senator
Phil Gramm whom liberal critics are trying to implicate in the
troubled sub-prime sector of the economy. In the Post
story, former Clinton Administration labor secretary Robert Reich
described Gramm as an advocate of “dog eat dog capitalism.” Jared
Bernstein, an economist who like Reich frets over free markets and
volunteers his services to return the American economy to the
delights of stagflation, is quoted as saying “McCain is counting on
people having very short memories” regarding the economy.
Well, I have a long memory. One of my favorite outbursts of
liberal economic angst came after the October 19, 1987 stock market
swoon that itself came at the end of 59 straight months of economic
growth. That incidentally brings to mind President Ronald Reagan’s
joke, that you could tell his economics were correct because
derisive liberals “don’t call it Reaganomics anymore.” In the
“Current Wisdom” we recorded the mainstream liberal alarums. They
were, as could be expected, hackneyed, hysterical, and wrong. Here
is the above quoted Reich writing in the New York Times:
“The binge is over. It couldn’t go on forever — the quick fortunes
[is he thinking about his friend Hillary Clinton’s $100,000 killing
in cattle futures?], the midnight raids and computer driven program
trades, the junk bonds, poison pills, leveraged buyouts, options —
all the glitz and glamour, the danger and thrill. It’s over….And
the rest of us who pretended not to notice are left with the job of
cleaning up the mess.”
Those foolish words were uttered on October 22. Two days before
the Times editorialized: “In a statement issued last
night, the White House asserted that the ‘underlying economy
remains sound.’ With the fire alarm wailing on Wall Street and the
country anxious for leadership, it gets an astonishing rerun of
Herbert Hoover. When will Mr. Reagan start fighting the fire?”
Actually the economy in that last quarter of 1987 grew at 4.8%.
Whether Reagan rode in on the hook-and-ladder I cannot recall.
Newsweek that last week of October titled its news
report “Panic 1987,” and led with the sentence “If it felt like the
end of a world, that’s because it was: last week’s global crash has
created a whole new financial reality….” The news story droned
on, “In disquieting echoes of Herbert Hoover, Reagan and his men
proclaimed that ‘the economic fundamentals in this country remain
sound.’” Should I go on? The famous liberal economic pundit, John
Kenneth Galbraith, wrote, “This debacle marks the last chapter of
Reaganomics….” Michael Kinsley wrote that “[t]he Phillips Curve
is about to boomerang upon us with a vengeance.” New York
Times columnist Anthony Lewis wrote, “The age of Reagan is
over….”
I believe you get my drift. The liberal chorus has been
basically wrong about economics, certainly about economic setbacks,
for a long time. Today’s White House is sounding a bit like the
Reagan Administration in 1987, claiming that the economy is
fundamentally sound. Back in 1987 the economy continued to grow
until the brief and shallow recession of 1991. Today I make no
prediction, but it does seem that economic fundamentals remain
sound. If I am right, I do not expect to be quoted by my liberal
friends in the prosperous years ahead.
