Monday, April 21, 2003
Staying on message: Did you know that New York Times columnist Paul Krugman thinks President Bush's economic plan is bunk? Oh, and did I mention that Krugman thinks Bush's economic plan is a disaster? Oh, don't forget that the plan is bad.
Krugman is obviously under instructions from the anti-Bush left to push that theme. Practically every column Krugman writes echoes the theme so often that it sounds like an embarrassing nervous tic, or a maniacal obsession.
Of course, there's no reason to take anything Krugman writes seriously. Basically, Krugman's assessment of the Bush administration's plans and motives come from the same place that Tawana Brawley's rape allegations came from. Still, let's pretend that Krugman is serious.
At what price would those jobs be created?
By price I don't just mean the budget cost; I also mean the cost of sacrificing other potential pro-employment policies on the altar of tax cuts. Once you take those sacrifices into account, it becomes clear that the Bush plan is actually a job-destroying package.
Why isn't this on the front page of the Times? Krugman has revealed that Bush's economic plan is part of a bigger plot to elect a Democrat in 2004. Bush, contrary to the political axiom that what every first-term president wants most is a second term, is creating a complex economic plan that's sole goal is to destroy the American economy and thus deny the current president re-election.
Not that the budget cost is minor. The average American worker earns only about $40,000 per year; why does the administration, even on its own estimates, need to offer $500,000 in tax cuts for each job created? If it's all about jobs, wouldn't it be far cheaper just to have the government hire people? Franklin Roosevelt's Works Progress Administration put the unemployed to work doing all kinds of useful things; why not do something similar now? (Hint: this would be a good time to do something serious, finally, about port security.)
That's what we need! More government workers! If he talks like a socialist and walks like a socialist....
Meanwhile, the United States is in effect about to run a W.P.A. program in reverse. That is, as a nation we're about to reduce spending on basic needs like education, health care and infrastructure by at least $100 billion, maybe more. And these spending cuts ? the result of the fiscal crisis of the states ? amount to a job destruction program bigger than any likely positive effects of the Bush tax cut.
More than a third of Krugman's $100 billion figure is just the state of California. Krugman's suggestion for months has been for the federal government to bail the states out of their free-spending ways. (If memory serves, four states sitll have budget surpluses -- would Krugman give those states "assistance" too -- despite the fact that they were fiscally responsible?)
Economics isn't engineering -- you can't look at an economic plan on paper and determine whether or not it will stand up. Bush and his economic advisers believe their plan can help the economy grow. Krugman disagrees, but he refuses to acknowledge that there even exists an opposing opinion. So instead of providing Times readers insightful analysis (the president's plan won't work because policy A causes the public to behave B and that hurts the economy C), he resorts to lame Joseph McCarthy slanders and lame turns of phrase.
I wrote once that Krugman had an excellent column when he endeavored to teach his readers the methods used by Enron to game the California electricity market. Krugman might eventually live up to his reputation as an accomplished economist if he aims to teach as opposed to demagogue.
*UPDATE* Donald Luskin points out that Krugman has a problem comparing like periods of time. Luskin points out that Krugman compares the tax cut figure, which is over a period of 10 years, to the job-creation figure, which is over a two year period. Thus, Krugman comes up with the laughable assertion that every new job costs $500,000 to create with Bush's plan. Thus, Luskin observes:
And that puts Krugman off by a factor of 29. Not bad for a politician -- but scandalous for an Ivy League econ professor.