I've Got Issues

Where I toss out armchair analyses on the news of the day.

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Saturday, April 26, 2003
 
Irony: For all of our fears about terrorism, traditional Chinese farming practices may turn out to be the bigger threat.

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Tuesday, April 22, 2003
 
Brad DeLong writes such a good blog that I usually let him pass on his occasional root-for-the-home-team approach to political economy. DeLong served as Assistant Secretary in Clinton's Treasury Department, so I don't blame him if his tally sheet of Republican vs. Democrat hints of very understandable bias. But now he's crossed the line with this:

One problem for us American liberals is certainly that Republican administrations tend to provide excellent demonstrations of Friedman's claim of governmental incompetence/capture/counterproductive behavior--massive government failure that outweighs probable estimates of market failure and creates a strong case for the shrinkage of the regulatory state. Witness Reagan, Bush II fiscal policy. Witness the Bush II farm bill, steel tariff. ...

Boy, is the good Doctor ever laying it on thick. Not that he's exactly wrong. Reagan and Bush II did turn in less fiscally responsible budgets than Clinton. Bush has betrayed free trade and has continued agricultural subsidies. However, DeLong forgets that Democratic congressmen and interest groups fight pretty hard for those agricultural subsidies and tariffs and always have. DeLong forgets that it was Republican votes in Congress that carried the day for Clinton's NAFTA in 1993. DeLong forgets that Republicans in 1996 were the ones who initiated reform of agricultural subsidies. DeLong also forgets how Clinton betrayed Tim Penny and other fiscally conservative Democrats, doing everything he could to prevent them from proposing spending cuts after he had agreed to let them propose these spending cuts as a condition for their votes in favor of his deficit reduction package. DeLong forgets a lot.

But DeLong's forgetfulness starts to rival Reagan's when DeLong forgets the massively irresponsible move that his former Boss made in 1995, when Republicans proposed cutting the growth of Medicare. Clinton went full-blown demagogue on that one, decrying the Republicans for "balancing the budget on the backs of the elderly" and whatnot. Clinton's strategy was politically successful, but it made any sensible early-term Medicare reform politically impossible. Clinton made it politically impossible to make gradual cuts in Medicare over the long-term, which moved America that much closer to that highly unpalatable future choice between higher taxes, sudden and severe cuts in Medicare/Social Security, or virtual elimination of non-entitlement Federal spending that DeLong outlines so well. DeLong rightly blasts the Republicans with "Oh, the decision to cut your Social Security and Medicare benefits by 1/3 was implicit in those tax cuts you voted for back in the early 2000s. You didn't realize that? Too bad," but somehow forgets to mention that Clinton did the same thing: "Oh, the decision to raise your payroll taxes to 33% (or cut your Medicare and Social Security benefits by 1/3) was implicit in preventing the Republican Medicare cuts in 1995-1996. You didn't realize that? Too bad." DeLong also forgets that later in his administration, Clinton (and later Al Gore) proposed expanding the Medicare program to include a prescription drug benefit for all seniors, a proposal that would exacerbate all of the problems that America faces in the future. DeLong's blind spot is starting to block out that light of economic truth that he likes to shine in the faces of those benighted Bushies.

But the real coup de grace arrives when DeLong, oops, forgets that his former boss, the beloved BC, started the Medicare battle by opposing a policy that he himself had proposed just months before! Under an optional part of Medicare, seniors could buy prescription drug coverage and pay 33% of the costs out-of-pocket. Under prior legislation, this portion covered by seniors out-of-pocket would drop to 25% starting in 1995. Clinton publicly expressed a favorable view on keeping the out-of-pocket share at 33%. When the Republicans arrived in 1995, they proposed that seniors continue to pay 33%. Suddenly, Clinton turned around and opposed the Republicans on this proposal for his political gain. It worked, but it was both shameful and fiscally irresponsible, and it showed the depths to which Clinton would sink. Clinton demonstrated how easy it is to achieve political success by opposing any and all entitlement reform, which is far more costly to our nation than Bush's tax cut.

I don't expect DeLong to agree with that final statement, and I expect him to make a pretty good case against it. But given what I have written, I would like to challenge DeLong to either show me where he has opposed a specific economic policy or proposal by the Clinton administration, or to point out the most irresponsible Clinton economic policy proposal. DeLong gets bonus points if he can point to a specific instance where Congressional Republicans were more responsible than Clinton.

I am going to copy this post and email it to DeLong. I will give DeLong ample time to reply before I diagnose him with Feverus Potomacus, as he is a busy man. I also allow DeLong to designate part or all of his reply email as confidential and not to be publicly shared.








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