Krugman: Culture Of Fraud

[ProSense]

Culture Of Fraud

Still on vacation, but I have internet access for a bit, and have checked in on a few matters. The big story of the week among the dismal science set is the Romney campaign’s white paper on economic policy, which represents a concerted effort by three economists — Glenn Hubbard, Greg Mankiw, and John Taylor — to destroy their own reputations. (Yes, there was a fourth author, Kevin Hassett. But the co-author of “Dow 36,000″ doesn’t exactly have a reputation to destroy).

And when I talk about destroying reputations, I don’t just mean saying things I disagree with. I mean flat-out, undeniable professional malpractice. It’s one thing to make shaky or even demonstrably wrong arguments. It’s something else to cite the work of other economists, claiming that it supports your position, when it does no such thing — and don’t take my word for it, listen to the protests of the cited economists.

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Meanwhile, Romney’s tax plan is now a demonstrated fraud — big tax cuts for the rich that he claims would be offset by closing loopholes, but the Tax Policy Center has demonstrated that the arithmetic can’t possibly work. He turns out to have been dishonest about when he really left Bain. And on and on.

So this is a campaign that’s all about faking it — fake claims about Obama, fake claims about policy, fake claims about Romney’s personal history.

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http://krugman.blogs.nytimes.com/2012/08/10/culture-of-fraud/

[ProSense]

1. Kick! n/t

[geckosfeet]

2. Krugman is more productive on vacation than I am during a week on the job....

Culture Of Fraud

And by the way, this isn’t obscure stuff. To take one example: the work of Mian and Sufi on household debt and the slump has been playing a big role in making the case for a demand-driven depression, which is exactly the kind of situation in which stimulus makes sense — so you have to be completely out of it and/or unscrupulous to cite some of their work and claim that it refutes the case for stimulus. Or to take another example, which Brad DeLong picks up, anyone following the debate knows that the Baker et al paper claiming to show that uncertainty is holding back recovery clearly identifies the relevant uncertainty as arising from things like the GOP’s brinksmanship over the debt ceiling — not things like Obamacare.

Can Hubbard, Mankiw, and Taylor really be that out of it? I don’t think so. They just believe that they can pull one over on the rubes, and pay no professional price. Let’s hope they’re wrong.

....

Remember, Romney spent months castigating President Obama because he "apologizes for America" — something Obama has never, in fact, actually done. Then he spent weeks declaring that Obama has denigrated small business by claiming that businessmen didn't actually build their own firms — all based on a remark that was clearly about infrastructure.

[Bucky]

3. Ouch. Damn.

Krugman's making it harder for Republican economists to play the wink-and-dodge games they usually play when supporting their party's presidential candidates.

Republicans are continuing to run a shadow replica of the Laffer-curve bait and switch they tried out in the 1980s, which turned out to be a colossal failure. The Laffer curve, for those who don't remember the 80s, was the argument that if you cut taxes enough, the resulting economic boom will actually increase gross revenues. No economic theory was ever more aptly named, because it turned out to be a joke. The math is a little daunting, but not hard to figure out. Cutting tax rates could only increase total revenues if there were an economic growth rate that exceeds the gross level of tax cuts. That is, if you cut the national effective tax rate from 40% to 30% of personal income, then you'd need to produce something on the order of a 90% growth in the economy to offset the reduction in revenues in dollars.

Republicans, without uttering the name Laffer, are still making this argument--at least by implication--when they talk about growing their way out of the deficit, and they are conceding the argument's ridiculousness when they argue now about reducing the size of government. It's like hiring the same contractor to fix your garage after they fucked up the roofing to begin with.