Semester's Over (If You Want It)

Since the semester is over, I'm going to have a bunch of time on my hands. So I'm going to start blogging again. Hooray.

Yesterday I borrowed Paul Krugman's latest book, The Conscience of a Liberal, from the library. I anticipate that the book is going to be pretty similar to Supercapitalism by Robert Reich. The thesis is that America's postwar consensus on political and economic issues was what made the last century the American Century and that the radical right must be stopped from dismantling the social safety net of the New Deal.

The book's title is a reference to Barry Goldwater's 1960 The Conscience of a Conservative, which galvanized movement conservatism in the United States. Krugman is taking aim primarily at that movement, so he wants his book to serve as a foil to Goldwater's.

Krugman spends the first two chapters laying out parallels between the last 40 years and the Gilded Age, which is by no means a novel comparison. I think it holds up well, though. Krugman points out that the groups that would later become FDR's New Deal coalition were divided along racial and geographical lines during the Gilded Age, and that conservatives are working to do the same thing today. Conscience was published before Sarah Palin came onto the scene and started throwing around the "real America" meme, but she was far from the first to latch onto that wedge rhetoric. It's been a favorite right-wing trope for years.

The author is a stalwart Keynesian, and he has recently been arguing that the government's response to the current economic slump should be an aggressive fiscal stimulus. I anticipate that the book will have lots of nice things about Roosevelt and the New Deal. Since I'm a huge nerd, I hope it gets pretty wonkish. Check back here for my take on the rest of the book.

Clinton disses economists

In an interview yesterday with George Stephanopoulos, Sen. Hillary Clinton defended her proposal to suspend the federal gas tax this summer by dismissing the opinions of economists, who universally agree that the idea is bogus. You can see the video here- she says at 3:55, "I'm not going to throw my lot in with economists,"as though they were some cult that would ruin her electability if she were associated with them. She insists that her policy will work if we just do it right. Barack Obama knows better; he voted for a gas tax holiday when he was in the Illinois State Senate. It was a dumb idea then as now; it didn't work and, like an adult, Obama admits his mistake.

Obama derides the tax holiday as a measure which will save the average consumer $30, or the price of half a tank of gas. Even that is generous. The price of gasoline is at a national average of $3.60 a gallon because that is what the market will bear right now. If we lifted the 18.4-cent federal gas tax, companies could sell the same volume at the same price and pocket the extra $9 billion which the tax is projected to collect this summer. If Sen. Dick Durbin (D-IL) knows what he's talking about, oil refineries in America are operating at 85% capacity right now. To me, that says that oil companies have projected what amount of gasoline is going to maximize their profits, and that's the amount they're going to put on the market. Lifting the federal tax is no incentive for them to lower prices and forgo a larger potential profit.

So far as I have heard, the unanimous opinion of economists is that there is no chance the tax holiday will work. Faced with the opposition of people who know what they are talking about, Clinton went into full-blown W-style denial. In her interview with Stephanopoulos, Clinton justified her flat-earthism by complaining about the Bush administration's pro-corporate elitism. She is disturbed by their disdain for the average person, but she embraces their disdain for facts. She contends that our government has relied on "elite opinion" which cares nothing about the little guy. I have to wonder whether or not the elites she is talking about include the economists who have long agreed that "trickle-down economics" does nothing to help the poor or the scientists who have warned with increasing urgency about the danger global warming poses for the world's poor. She can talk all she wants about helping the less fortunate, but if she plans on continuing the White House aversion to facts, she's not going to do anyone any good.

What really surprised my about this whole episode was how quickly Clinton threw Paul Krugman under the bus. Krugman, a New York Times columnist, Clinton supporter, and economist, argued last week that the tax holiday is a ludicrous proposal, though he focused more on Sen. John McCain's support for it and soft-pedaled his criticism of Clinton. When Stephanopoulos pointed out Krugman's dissent, it elicited a wickedly supercilious dismissal.

Clinton's no-facts-necessary style is most disappointing in view of the larger themes of her campaign, which bear a stultifying resemblance to the imagery and tactics employed by Republicans in recent years. It's dangerous for Clinton to cast Obama as an elitist who is out of touch with working-class voters and as weak on national security. Along with the lack-of-experience argument, these are the lines McCain would advance against her in the general election if she won the nomination. As things stand, she's making his case for him. Obama may not be great, but at least he will be somewhat different from the disaster we have now. And at least he has some grounding in reality.