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The Spectacle Blog
Today President Obama announced the nomination of Princeton labor economist Alan Krueger to head the Council of Economic Advisers. Krueger is already a veteran of both the Obama and Clinton administrations.
For information on what the CEA chair does, read Keith Hennessey’s description of the roles of the various economic advisers. As CEA head, Krueger will be giving Obama big-picture advice and explaining economic concepts and research for the president. In that capacity, he shouldn’t represent a significant break from previous Obama CEA chairs Christina Romer and Austan Goolsbee, except perhaps in that his expertise has less to do with macroeconomics than with lower-level subjects relating to labor markets and other microeconomic concepts.
Brad Plumer has a good summary of Krueger’s academic work. Arguably his most famous paper (it was taught in my intro to labor economics course in college, at least) is a study on the impact of minimum wage laws, using differing laws in Pennsylvania and New Jersey as a natural experiment, that found evidence that minimum wage increases do not necessarily increase unemployment. Jim Pethokoukis argues that the results of that study were undermined by later research. Krueger has also been criticized by conservatives for favoring a significant Value-Added Tax, pushing for a cap and trade program, botching an employment projection, and for being an all-round liberal.
The one item in his background that stands out as a cause for concern, though, is his earlier work for Obama in enacting Cash for Clunkers. Cash for Clunkers was a program in which people traded older, less efficient cars for a rebate on purchases of newer, more fuel-efficient cars. The older cars, once traded in, were destroyed. The effect of the program was to shift some demand for fuel-efficient cars from the future into the present, create a windfall for some dealers, and cause the destruction of hundreds of thousands of useful cars that otherwise would have gone into the secondary market. It represents the worst of stimulus thinking: it would have been better simply to cut taxes by an equivalent amount, or probably even just to mail checks to random people.
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More Blog Posts by Joseph Lawler
http://spectator.org/blog/2011/08/29/alan-krueger-to-head-council-o
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Bob Grant| 8.29.11 @ 7:11PM
Mmmboy. Is this what we have to look forward to?
More CfC type programs?
Wage controls?
Cap and Trade?
This is a recipe for the Great Depression part De aux.
Haven't we seen this movie already? ...
The Nightmare on Pennsylvania Ave ?
Maybe this guy's real name is Freddie Krueger, not Alan Krueger.
Oldefarte| 8.29.11 @ 7:31PM
These typical university professor egghead types are completely worthless and a waste of the taxpayers' money. In main street language, none of them know THEIR A*S FROM A HOLE IN THE GROUND about practical economics/finance in the real business world. These theoritical idiots are like this president in that the only thing they understand comes froth from the pages of a book. None of them have run a company and wouldn't know a balance sheet or an income statement if it bit them in their academic a^ses!!!!!!
PCC| 8.29.11 @ 7:47PM
Well, he has a PhD from Harvard, so he must know what he's doing.
beebop| 8.30.11 @ 5:17AM
When I heard this yesterday, I knew that I would do well to skip the speech coming about jobs. It is clear that the only job creation is more in the government. It is akin to adding more HR staff to a company that needs to retool a manufacturing line. Does this resident know any people who have worked in the private sector? Just askin.
martin j smith| 8.30.11 @ 7:37AM
Yawwwwwwwwwwwwwwwwwnnnnnnnnnn. Moooooooooooooooooooorrrrrrr of the saaaaame.
Grzmlyk| 8.30.11 @ 12:10PM
Let me get this straight: He doesn't believe in the economics of reality (minimum wage laws always increase unmployment everywhere they are implemented, and for very obvious reasons); he supports new forms of theft from taxpayers in not one, but two totalitarian ways - a V.A.T as well as cap-and-trade; he lies about employment numbers and he's a classic Keynesian - and "the ONE item in his background that stands out as a cause for concern" is his support for Cash for Clunkers?
Helloooooooooooooo!
Uh, it's all of a piece. The guy is a classic elitist, nihilistic academic fool, masquerading as an earnest champion of the little guy, one of countless fungible leftists who look at the destruction they wreak and, with oh-so self-satisfied grins, call it "progress."
Saying the Cash for Clunkers debacle is the ONE cause of concern for this guy is like saying, you know, what really bothered me about Jeffrey Dahmer was that he was cruel to small animals.