There’s a savory juxtaposition on the Op-Ed page of today’s Times. In the top-left position we have yet another column from former Enron adviser Paul Krugman, calling for further government stimulus of the economy (he’s been tag-teaming with Bob Herbert on this theme for months now).
Spend now, while the economy remains depressed; save later, once it has recovered. How hard is that to understand?
Very hard, if the current state of political debate is any indication.
Right; got it. Spend money when you haven’t got it; keep it out of circulation when you do. If your theory hasn’t worked after almost a trillion dollars of stimulus, that’s no reason to doubt the theory. Just keep at it. Another few hundred billion, and voilà!
There are support groups for people who apply this sort of reasoning at Foxwoods, but then, they don’t have Nobel Prizes.
Just below is a column from Ross Douthat, titled The Agony of the Liberals. In it he talks about two vices that have recently led liberals to the brink of panic. The first is “the worship of presidential power: the belief that any problem, any crisis, can be swiftly solved by a strong government, and particularly a strong executive.”
Mr. Douthat continues (my emphasis):
The second vice is an overweening faith in theory. It’s now conventional wisdom among Obama’s liberal critics that the White House has been insufficiently ambitious about deficit spending. The economy is stuck in neutral, they argue, because Obama didn’t push last year’s recovery act up over a trillion dollars, and hasn’t pressed hard enough for a second major stimulus.
Technically, they could be right — but only in the same way that it’s possible that the Iraq War would have been a ringing success if only we’d invaded with a million extra soldiers. The theory is unfalsifiable because the policy course is imaginary. Maybe in some parallel universe there’s a Congress that would be willing to borrow and spend trillions in stimulus dollars, despite record deficits, if that’s what liberal economists said the situation required. But not in this one.
Yet the liberal drumbeat continues. As Tyler Cowen wrote last week: “advocates of fiscal stimulus make it sound as simple as solving an undergraduate homework problem and … sometimes genuinely do not realize how much the rest of the world, including politicians, views them as simply being very convinced by their own theory.” Nor do they acknowledge how much risk those same politicians have already taken on (with the first stimulus, the health care bill, and much else besides) in the name of theoretical propositions, while reaping little for their efforts save an ever-grimmer fiscal picture.
I don’t know whether the presentation of these two columns on the same page was a deliberate setup by some mischievous junior editor, but I’m sure I’m not the only one out there who appreciated it.