“The Economist” defends divided government from attack by hysterical Nobel Prize winning emo economist

By mw | Related entries in Economic crisis, Economy, Partisan Hacks, Partisan Nonsense

This election cycle precipitated a conversation about the virtues and vices of a divided federal government in both new and traditional media. In the last few days before the vote, the amplitude spiked. Much of the most recent attention is in the form of an attack from the left on the foundation of the divided government voting rationale. Recent entries include Ezra Klein (again and again), Matt Yglesias, New York Times, John Sides (and again), Paul Pierson at American Prospect and Anne Lowrey at Slate.

It almost looks coordinated. No matter. The reason is not hard to understand. The biggest erosion of Democratic support from ’08 to ’10 is from the independent, moderate, centrist, libertarianish vote. For the most part, these voters are not choosing to vote Republican in 2010 because they like the Republican candidates or because they suddenly have embraced GOP values. They are voting Republican to divide the government in the hope of reining in the Democratic agenda and restoring some semblance of fiscal rationality (either that or it is because the voters are stupid and gullible and Republicans tell better lies). The only surprise is that it has taken this long for Democrats to understand that their core problem is not apathy in the base. Their core problem is they have lost the center.

I don’t think this flurry is going to help short term, and in the longer term will be problematical for these scribblers. In two years they will all be making the argument for divided government. It won’t look good.

As a consistent advocate for a divided government voting heuristic, I am of the view that all publicity on this topic is good publicity. Over the four+ years I have been blogging about divided government, this election is the first time I have seen it discussed as if it is a conscious decision, rather than some inchoate, subconscious voter preference that mysteriously shows up periodically in the electoral results.

In any case these posts have kept me busy on my blog offering rebuttals to some of their arguments (for any interested, you can find my responses here, here and here).

Here at the Donk we’ll feature just one attack from liberal darling Paul Krugman. This – an awe inspiring, world class hysterical hissy fit from the lofty platform afforded him by the New York Times:

Divided We Fail – Paul Krugman

“Barring a huge upset, Republicans will take control of at least one house of Congress next week. How worried should we be by that prospect?.. This is going to be terrible. In fact, future historians will probably look back at the 2010 election as a catastrophe for America, one that condemned the nation to years of political chaos and economic weakness… The economy, weighed down by the debt that households ran up during the Bush-era bubble, is in dire straits; deflation, not inflation, is the clear and present danger. And it’s not at all clear that the Fed has the tools to head off this danger. Right now we very much need active policies on the part of the federal government to get us out of our economic trap… So if the elections go as expected next week, here’s my advice: Be afraid. Be very afraid.”


Whoa. Somebody get that man a Prozac.

The Economist responds:

Krugman’s Prophecy of Doom – The Economist

‘Mr Krugman’s attempt to raise the stakes fails utterly. He spends most of his column-inches noodling about the ways in which our imminent divided government will not resemble the one that reigned in the fondly-remembered Clintonian golden age. In his last paragraphs, Mr Krugman finally arrives at the only really pertinent question: How would the Democrats’ holding their House majority save us from the terrible fate he now foresees? Here’s what he says:

“Right now we very much need active policies on the part of the federal government to get us out of our economic trap.

But we won’t get those policies if Republicans control the House. In fact, if they get their way, we’ll get the worst of both worlds: They’ll refuse to do anything to boost the economy now, claiming to be worried about the deficit, while simultaneously increasing long-run deficits with irresponsible tax cuts — cuts they have already announced won’t have to be offset with spending cuts.”

Mr Krugman implies that if Democrats continue to control the House, we’ll get the expensive “active policies” that will save us and avoid the expensive tax cuts that will prolong our woes. Of course, Democrats control the House now. This has not spared us Mr Krugman’s vein-popping fits over the current Democratic government’s disinclination to enact a second budget-busting stimulus.’

The money quote:

“It’s a little sad, isn’t it, when even our most eminent public intellectuals waste so much of their time, and ours, on baseless partisan freakouts?”

I think that pretty much sums it up. Except for what Nike Gardiner at the Telegraph had to say:

Paul Krugman and the last gasp of America’s liberal elites – Nike Gardiner

“Not only is Krugman’s article one of the most ridiculous pieces of scare-mongering in the history of modern American journalism, but it is the pathetic whimper of a decaying liberal Ancien Regime that is spectacularly crumbling. It also illustrates just how out of touch liberal elites are with public opinion, as well as economic reality. The tired old blame Bush line no longer works, and as a recent poll showed, the former president’s popularity is rising again.”

That first sentence above being the other money quote. That really says it all. Well, except for…
Krugman: The Only Think We Have is Fear Itself - Ed Driscoll

So what does it say when Krugman is sounding doomsday reports that the GOP winning Congress on Tuesday condemn America “to years of political chaos and economic weakness?” Let’s ask Krugman himself, circa 2000. In his essay “How to Be a Hack,” he sagely warned that it’s “still a good idea to tune out supposed experts whose minds are made up in advance.” I hope I’m not jumping the gun myself when I say that for once, Krugman’s advice sounds spot-on.

Paul Krugman says “This is going to be terrible” – Ann Althouse

“Hey, wait, I thought it was Democrats who liked to say Republicans are trying to scare us. Now, it’s just Republicans are scary, and we hope you believe that they’re scary to everyone, and not just to Democrats.”

When Paul Krugman says the 2010 election means disaster, you can bet on the opposite happening – Mark Hemingway

“But far be it from me or anyone else to suggest that Krugman’s off his rocker when he says a Republican House of Representatives portends disaster. Birds gotta fly, fish gotta swim and Krugman’s gotta make terrible predictions. As we speak, he’s probably stroking his Nobel Prize and staring wistfully out the window — the leaves are pretty on Princeton’s campus this time of year — and contemplating the Xanadu we could have had if only we’d coughed up another trillion in stimulus. Let him indulge his fantasies. It’s better that way.”

To be fair, all the comments quoted in response to Krugman’s column are from right-of-center columnists and bloggers. OTOH, Google could not find anyone of note from the left trumpeting or even defending Krugman’s column.

Methinks even his liberal brethren are embarrassed about this particular Olbermannesque screed.

X-posted from Divided We Stand United We Fall


This entry was posted on Monday, November 1st, 2010 and is filed under Economic crisis, Economy, Partisan Hacks, Partisan Nonsense. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

19 Responses to ““The Economist” defends divided government from attack by hysterical Nobel Prize winning emo economist”

  1. Tweets that mention Donklephant » Blog Archive » “The Economist” defends divided government from attack by hysterical Nobel Prize winning emo economist -- Topsy.com Says:

    [...] This post was mentioned on Twitter by Justin Gardner, Donklephant. Donklephant said: DONKLEPHANT: “The Economist” defends divided government from attack by hysterical Nobel Prize winning emo economist http://ow.ly/19KD6y [...]

  2. Jim Satterfield Says:

    “To be fair, all the comments quoted in response to Krugman’s column are from right wing fruitcake columnists and bloggers with severe cases of ODS because they’re the only ones I agree with.”

    Fixed that for you, mw.

  3. kranky kritter Says:

    We’re at douche-con 5 in the final days. That means that on both sides, even usually sane partisans go over the top in a preposterous attempt to sway late deciders with apocalyptic rhetoric.

    What’s glaringly missing from Krugman’s rant is any acknowledgement that whatever passes must come with consent from both parties. So for example, the GOP can’t pass any “irresponsible” tax cuts without cooperation from democrats.

    I do not agree with you that the forthcoming midterm results are being driven by a conscious effort from independents and centrists to create a divided government. I have zero sense that voters are connecting that many dots as part of some plan. They are just pissed off. It’s that simple.

    Inconvenient for your pet hypothesis, but you just don’t have parsimony on your side here.

  4. Wickedways Says:

    Paul Krugman who the left idolizes realizes that he is going down in history as the fall guy for this failed policy and political disaster the Democrats are facing today. He once again is playing the intellectual elitist card and proclaiming that all the stupid Americans just don’t get it.

    “We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get a job. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot.”…….Roosevelt’s Secretary of the Treasury testifying before congress in 1939. Henry Morgenthau, Jr.

    Keynesian economic policy did not work in 1930-1941 and it is not working now. The only thing it does is add debt, increase the size and scope of government.

    This is something I posted here a few days ago and I felt it applicable to this post. Once again this is policy driven rejection of the Obama spend till you drop keynesian economic theory. It is a rejection of Paul Krugman and it is a rejection of the lefts “FEARMONGERING”. The same fearmongering they howled about that the right was doing when they were in power.

    Democrats as late as last night were bemoaning the fact that Obama did not spend enough. Chris “Tingles” Mathews on MSNBC yesterday was trash talking Obama for letting this happen.

    Tomorrow they will be talking about how the Democrats will be out in the wilderness wandering around looking for their soul and perhaps banished for decades….Or at least 2 years…whichever comes first.

  5. Rich Horton Says:

    So Jim you are defending the calculus:

    Republicans Winning Elections = Catastrophe for America

    And doing so in the context of a nominally (at least) centrist blog.

    OK

    Your new learning amazes me. Explain again how sheep bladders may be used to prevent earthquakes.

  6. bubbaquimby Says:

    Jim is becoming a worse troll than SD. His partisan hackery is becoming worse every election.

  7. kranky kritter Says:

    I don’t think anything conclusively demonstrates that high gov’t deficit spending in response to a severe downturn is a “failed” policy.

    I don’t think anyone knows how bad the downturn could have been without the bailout and the stimulus. And I’m glad we don’t know. Because the only way to have known would have been to go through that worse downturn. The inevitable trade-off has been this: if you manipulate a fall to get a shallower trough, you get a slower recovery. Not my rule, Newton’s.

    This three or 4 budget cycle of a very high level of debt-fueled spending started with the last Bush biudget and has continued to the present. It is absolutely unsustainable. We’re going to start pulling back seriously from it with the upcoming budget, and that sounds about right to me.

  8. WHQ Says:

    Here’s an article that makes similar points to Krugman’s, but without the hyperbole:

    http://finance.yahoo.com/news/Likely-gridlock-in-Congress-apf-3958821672.html?x=0

    Some excerpts:

    “We expect massive gridlock and little cooperation,” writes Brian Gardner, Washington analyst for the financial firm Keefe, Bruyette & Woods.

    If times were good, gridlock wouldn’t matter so much. A Republican Congress and Democratic White House butted heads in the mid- and late ’90s, after all, and their sparring did nothing to derail a strong economy.

    But now, nearly a year and a half after the official end of the Great Recession, the economy still isn’t growing fast enough to bring down unemployment, which is stuck at 9.6 percent.

    and

    Reviewing stock market and election results dating to 1950, Fidelity Investments concluded that stocks soar the year after midterm elections, with or without divided government.

    Stocks of small companies surge an average of about 46 percent in the year after a midterm election that gives one party control of both Congress and the White House, Fidelity’s research found. That compares with a gain of about 24 percent after the government is left divided. Large-company stocks perform about the same either way.

    and

    “Short-term gridlock is very bad for the outlook,” Bank of America analysts say in a report on the election. “In today’s challenging environment, inaction is dangerous.”

  9. WHQ Says:

    The inevitable trade-off has been this: if you manipulate a fall to get a shallower trough, you get a slower recovery. Not my rule, Newton’s.

    That trade-off can happen and has happened, but that doesn’t make it inevitable. There is no rule here, and certainly not one Newton had anything to do with.

  10. mw Says:

    @JimS
    I will defer to your authority on all things related to “Derangement Syndrome”, given your long-standing and intimate experience with this particular psychosis.

  11. Justin Gardner Says:

    Here’s where I think Krugman is right. Republicans are selling a false bill of goods. They claim that they know how to save the economy, but all they’re proposing are spending freezes and tax cuts. Meanwhile, they’ll extend tax cuts to people who don’t need them without paying for them. Also, they want to repeal the health care bill and replace it with *crickets*…any feasible ideas? Nope.

    What we’re going to have for the next two years is gridlock. If Americans are voting for change and they want to get things done, this is complete opposite of what they should be doing. Republicans have said they won’t compromise and they don’t have a veto proof majority. This is all posturing for 2012. NOTHING will get done.

    Meanwhile, if you actually look at what the 111th congress has done, it’s impressive. None of these should be controversial, but the vast majority of Republicans fought tooth and nail to get these killed.

    - Billions for over 100,000 needed infrastructure improvements
    - Additional tax cuts for 95% of all Americans
    - Health care providers can no longer deny people coverage because of preexisting conditions
    - The Credit CARD Act of 2009 which made double-cycle billing, random interest rate hikes and other practices illegal.
    - A financial regulations bill with some teeth that ends the black box that was the derivatives market.
    - Establishing an Consumer Financial Protection Bureau
    - The Small Business Jobs Act which freed up $300B in credit and lending programs.
    - The U.S. Manufacturing Enhancement Act
    - Protecting American patents
    - Preventing the Outsourcing of U.S. jobs

    Things that could become law…
    - Energy Jobs and Training for Veterans
    - Currency Reform for Fair Trade Act
    - All-American Flag Act
    - American Manufacturing Efficiency & Retraining Investment Collaboration (AMERICA Works) Act
    - Rare Earths and Critical Materials Revitalization
    - Congressional Made in America Promise Act
    - Berry Amendment Extension Act
    - Rural Energy Savings Program Act
    - Strengthening Employment Clusters to Organize Regional Success (SECTORS) Act
    - National Manufacturing Strategy Act
    - Clean Energy Technology Manufacturing and Export Assistance Act
    - Emergency Trade Deficit Commission

    As I’ve said before, I hope I’m wrong, but I doubt people are going to be very happy with the Republicans. Voters are just blindly stabbing Dems without understanding exactly what they’ve done. That’s fine since the Dems haven’t done a good job of getting the message out, but when you have Republicans just lying about what hasn’t gotten done and demonizing nearly anything that the Dems are trying to do…what does everybody think the result is going to be? If you repeat a lie often enough…

    Moving on.

  12. mw Says:

    “I have zero sense that voters are connecting that many dots as part of some plan. They are just pissed off. It’s that simple. Inconvenient for your pet hypothesis, but you just don’t have parsimony on your side here.” – kk

    I prefer to conflate the two. It makes me happy.

  13. mw Says:

    @Justin,
    I have a different perspective on the 111th Congress:

    Massive spending increases and exploding deficits that make George W Bush look good in comparison. Let me repeat that. On fiscal responsibility Barack Obama makes George W. Bush look good in comparison. And the Bush administration was a fiscal disaster. I never would have believed that to be possible.

    An administration that embraces the power and scope of the Cheney/Bush Unitary Executive definition with an appetite for expanding the scope of the executive branch to managing the economy and private industry. A lay-down Congress that is not even pretending to exercise their constitutional executive oversight responsibility. And rather than working to roll-back the civil rights erosion of the Cheney/Bush era, the Obama administration Justice Department is defending some of worst excesses of the Bush administration in court.

    Nothing says more about the dangers of legislation produced by One Party Rule, than the two signature legislative achievements of this administration – ARRA (aka porkulus) and HCR (aka Obamacare). The first, a wildy expensive stimulus package that does not stimulate, but does protect and expand public sector jobs while the private sector contracts, and steamrolled on a purely partisan vote. Despite being sold as needed to rebuild infrastructure, despite being the most expensive single piece of legislation in history (until eclipsed by HCR a year later), we are now told we still require additional infrastructure spending not even two years later. Even though the stimulus money has not all been spent.

    And what can one say about the Health Care Reform legislation that has not already been said? Wildly expensive, it does not reform the system, does not control costs, is not paid for, does not provide universal coverage, is insanely complex and no one understands how it works. Least of all the Democratic legislators who steamrolled it on a purely partisan vote. Because they could.

    Does anyone really believe that these two pieces of legislation would not have been significantly better and cheaper if the Democrats had no option but to compromise with Republicans? I am not saying it would have been good legislation. I am just saying it would have been better.

    Divided government is not a panacea. It is just demonstrably and unequivocally better than one party rule. If you want things to get better…

    Just vote divided.

  14. Wickedways Says:

    Justin you just pointed out the main reason that the people are pissed.

    The government is legislating us to freakin death and this is what those on the left who love, covet and adulate Regulations just cant fathom.

    They believe that the more the government does the more Americans should love the government.

    The left is just not getting it….the very long list of things you just pointed out is EXACTLY what is the problem.

  15. Mike A. Says:

    MW

    “And what can one say about the Health Care Reform legislation that has not already been said? Wildly expensive, it does not reform the system, does not control costs, is not paid for, does not provide universal coverage, is insanely complex and no one understands how it works. ”

    “What has already been said”, is not the same as “What is known to be true” In fact, for each of your points, there are strong counterpoints to be made.

    Considering, by your own words “no one understands how it works” yet you are able to fully understand and pass unambigious judgement on this “insanely complex” set of laws is truly amazing. Either you are more intelligent than everyone else, or what?

  16. Chris Says:

    “restoring some semblance of fiscal rationality ”

    Oh Mw, did I fall asleep and miss that? damn. I always seem to miss the republicans being fiscally “rational”.

  17. Mike A. Says:

    I have one conservative nomination for fiscal responsibility – NJ governer Chris Christie. There may be others…but they are rare.

  18. Moe Says:

    Well, what do we have here? An old column about Paul Krugman pooh-poohing the idea that the midterms would be disastrous for the Economy?

    HAHAHAHAHAHAHA

    (Ps. for the Mod – its okay if you don’t let my post go through; the blog-post is still delightfully wrong)

  19. Angela Says:

    47% of American households make $60,000/year and below.

    Don’t overcomplicate the matter. An economy needs spending, and saving. Can’t do either without discretionary income. That 47% has as much impact on our economy as the 20% (probably lower) or so making $100,000 or more. Our government seems to think that the best way to handle that 47% is by offering tax breaks, programs, entitlements, etc. I’m glad to see that legislation which is pro-consumer has been passed because I really think thats whats eating up the income of the less well off. More needs to be done to to free up their income.

    But I went off point. Yes, divided government is good. One party rule can make for disastrous results.

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