October 23, 2003 | 0 comments
The double world of Paul Krugman.
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WELL, THERE IS AN understatement. In fact, looking back at the entire Krugman oeuvre, someone familiar with him mainly as a shrill partisan can’t avoid being pleasantly surprised by how sound some of the professor’s work is (or was). The news here isn’t that Krugman’s a clown, but that Krugman is (or was) a reasonably smart ideas guy whose early professional experience was manifest while he served on the staff of President Reagan’s Council of Economic Advisers. They don’t give out the Nobel in economics for nothing. In other words, that’s a real jacket and tie Krugman has on over those shorts.
His 1996 Harvard Business Review essay, for example, dismissed central planning on the basis of the Hayekian idea that knowledge is distributed. “The simple fact is that governments have a terrible track record at judging which industries are likely to be important. At various times governments have been convinced that steel, nuclear power, synthetic fuels, semi-conductor memories, and fifth-generation computers were the wave of the future,” Krugman wrote, sounding like some American Enterprise Institute scholar scoffing at the Obama administration’s plans to subsidize windmills, electric cars, and Solyndra. “Of course, businesses make mistakes, too, but they do not have the extraordinarily low batting average of government because great business leaders have a detailed knowledge of and feel for their industries that nobody—no matter how smart—can have for a system as complex as a national economy.”
In the same essay, which was reissued as a slim book in 2009, Krugman wrote, “a good tax policy obeys the broad principles developed by fiscal experts over the years—for example, neutrality between alternative investments, low marginal rates, and minimal discrimination between current and future consumption.” Low marginal rates! Grover Norquist himself couldn’t have put it better.
“High marginal tax rates can hurt economic growth,” Krugman wrote in a 1998 book, The Accidental Theorist.
In 1997, writing in Slate about the Clinton administration’s commerce secretary, Krugman recommended “avoiding policy initiatives that make it easy for politicians to play favorites.” He wrote, “Some of us cringed when Ron Brown began taking planeloads of businessmen off on sales trips to China and so on. Whether or not those trips did any good….they obviously raised the question of who got to be on the plane—and how.”
As late as the 2007 book Conscience of a Liberal, Krugman allowed that Milton Friedman had “considerable justification” to criticize rent control—a policy beloved by urban liberals—as evil.
Conservatives hoping to counteract the influence of Krugman’s New York Times column could do worse than to transfer the best of these classic Krugman lines onto posters, pamphlets, or T-shirts and distribute them, fully attributed, to the columnist’s left-wing followers.
ONE OF THOSE FOLLOWERS is President Obama, and, alas, it’s not the professor’s instructions about the virtues of low marginal tax rates that the man in the White House has in mind.
The Obama-Krugman relationship, too, is something of a surprise; the Times columnist openly preferred John Edwards and Hillary Clinton to then-Senator Obama in the 2008 Democratic primary.
Yet rereading Conscience of a Liberal in early 2013, the striking thing is how a book written in 2007 served as a roadmap for Obama’s administration. It’s all there, with eerie prescience. Krugman recommended that the next president (he predicted a Democrat would win) start with health care. “Getting universal care should be the key domestic priority for modern liberals. Once they succeed there, they can turn to the broader, more difficult task of reining in American inequality.” How to do that, in Krugman’s view? Roll back the Bush tax cuts on wealthier Americans. President Obama has now followed both instructions.
If the precise nature of Krugman’s influence on the president seems not to be fully appreciated by the American public, it hasn’t been lost on the professor himself. “Does anyone doubt that the White House pays attention to what I write?” Krugman asked in a recent New York Times blog post about why the president should disregard a MoveOn.org petition with more than 200,000 signatories pushing the Princeton professor as Treasury secretary. “An administration job, no matter how senior, would actually reduce my influence.”
Again, it would be comical, except that this is not merely some New York Times columnist and part-time Ivy League professor overly impressed with an inflated view of his own importance. It’s not just about Krugman. It’s about the country. President Obama is actually on track to follow Krugman’s left-wing advice.
What, then, do we have to look forward to?
The bad news is that the rest of Krugman’s policy prescription involves taxing capital gains and dividends as ordinary income and raising rates for those earning $1 million a year or more to between 45 and 49 percent. As if that trebling of tax rates weren’t enough, he also wants a national value-added tax and “a price on emissions, through either a tax or a tradable permit scheme.”
Lest this forecast leave you gloomy, there is an alternative scenario that provides more hope. Maybe the president will stumble upon a 1996 essay by Krugman for the New York Times Magazine. The article imagines the world in the year 2096. It envisions environmental license fees as the main source of government revenue and reports that, “after repeated reductions, the Federal income tax was finally abolished in 2043.” Meanwhile, higher education underwent a crisis after parents and students asked, “Why should a student put herself through four years of college and several years of postgraduate work in order to acquire academic credentials with hardly any monetary value?” The result of the college and university shakeout was that the remaining professors had to support themselves with other jobs. Krugman, who reportedly has two cats with his yoga-instructor economist wife, wrote, “I actually don’t mind my day job in the veterinary clinic.”
He could probably do less harm in a veterinary clinic than he does on the op-ed page of the New York Times, though perhaps I am letting him off too easily by quoting the sole example of self-deprecating humor I found in reviewing hundreds of thousands of words of his writing.
Never mind the Treasury job. Perhaps it’s time for a petition to install Krugman as chief of the FDA’s Center for Veterinary Medicine. He might have to wear trousers to the office. All in favor, say “Meow.”
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
Was the President done in by the economy, or by the politics of the economy?