Pissing Down Your Leg

Thoughts on Economics and Economic Policy

Krugman in 2012?

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The New York Magazine has a long piece on Paul Krugman’s lonely voice from the left. I’m a big fan of PK. While I don’t always think his political prognostications are correct (would HRC really have been better than BHO? I doubt it), his economic pronouncements are almost always right. With the left without a leader, should we start draftpaulkrugman2012.com? Probably not. I doubt he would make a good politician (and might not even make a good chairman of the CEA), despite the fact that he’s a better thinker on economic/social issues than anybody else currently around.

Recently I’ve been thinking about what the country does need in order to move farther left to a world with universal healthcare, stronger unions, a higher minimum wage, and publicly-financed campaigns. Many of us on the left felt that we were getting just the kind of politician that we wanted in Obama, only to be disappointed by his desire to lead by compromise, to be the grownup in the conversation.

  • You want a $1.2 trillion spending stimulus? How about we ask for $850 billion and then compromise by reducing that and making half of it ineffectual tax cuts.
  • You want to close Guantanamo Bay? Well, let’s release some of them, maybe try to get a trial in Federal court, and then back down and just keep the status quo.
  • You want to nationalize the banks that caused this financial panic in order to protect the taxpayers? Let’s just funnel them billions of dollars, reduce the industry’s competitiveness, and hope they can recapitalize through profits.
  • You want to worry about the unemployed and create some sort of temporary jobs program? Well, maybe I can get another year of extended unemployment benefits by agreeing to keep taxes on the rich at low levels.

The list goes on and on. I can sympathize with the President. I understand all too well the impulse to compromise somewhere in the middle when a decision has to be made. It makes you look reasonable, it allows you to avoid more overt confrontation, and it allows you to move to the next problem. But there are at least two large problems with this style of leadership.

First, the Republicans are better at this game. Like an intelligent child, they see that if you want to compromise as a way of resolving conflicts, they should ask for two hours of TV instead of one. They should suggest cutting the top marginal tax rate to 25% instead of 35%. Democrats, on the other hand, seem much more likely to actually propose what they want. When we have a compromiser-in-chief, we end up a lot farther right than we ever expected to.

The second problem with this kind of leadership is that it simply isn’t leadership. The platoon leader doesn’t say, “Ok, the captain says we need to take this hill, but Robinson here has some serious misgivings. I’ve decided we’re going to go halfway up and ask the enemy for a truce.” The parent doesn’t shouldn’t say, “If you don’t want to eat your broccoli you at least have to eat a piece of bread.” The CEO doesn’t say–well, you get the point.

The leader must lead. She must say, “This is the right way. Follow me.” If she runs into obstacles, she must fight through them. If she runs into a roadblock, she must scream and batter it until it is lifted or it crumbles. She may not always seem to accomplish as much as someone willing to compromise, but she will do more of what she believes is right.

And this is the type of president that Americans admire. FDR was a leader. So was LBJ. Carter was not a leader. Reagan (in his own wifty way) was a leader. George W. Bush (in his demented way) was a leader in a way his father was not. Eisenhower was perhaps the best leader we’ve had, even though he did it in a fairly quiet, unassuming way. I think one of the problems for Obama is that Bill Clinton was fairly successful as a compromiser. As he is the only Democratic president we’ve had in the last 30 years, there are not a lot of other role models.

But I can’t help but think that Clinton was fairly lucky. The economy was getting a fairly big productivity shock from the introduction of information technologies into more and more industries. That allowed him to cut back on spending and (modestly) raise taxes without any economic problems. Obama seems to want to take that blueprint and apply it to the current economic situation which, unfortunately, is completely different. We had a huge financial crisis followed by a very deep recession and an incredibly slow recovery. If he needs a role model, he should look to FDR.

Don’t get me wrong, FDR made as many mistakes as he had successes. But he lead the country through the Depression. He showed the people that he was on their side, that he was fighting for them, and that he would try anything that might work to get the country back on its feet. When conservative judges dismantled his New Deal legislation, he tried to pack the court. Sure, that was a mistake and didn’t work, but at least it showed he was serious. His one major mistake was compromising in 1937 and pulling back on his stimulus programs, pushing the economy back into recession.

Is there anyone on the left who can lead? I don’t see anyone. Our smartest and most successful politicians (on the left) seem to be compromising technocrats. And those farther left (Waxman, Kucinich, etc.) just seem a little too odd to appeal to the majority of Americans. Obama the candidate could lead. Obama the president does not seem able to.


Written by Liam C Malloy

April 25, 2011 at 4:51 pm

One Response

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  1. The Left has gone nearly silent since Obama’s inauguration, and a big part of it seems to be the media shutout. Either that or there isn’t actually anybody left on the Left?! Jimmy Carter seems to be the only one that gets any notice these days, and that’s pretty sad. The Left is getting old, and their kids are too busy either trying to find a job or spending their parents retirement.

    Henry David Thorough

    April 29, 2011 at 10:30 am

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