Republicans Can Always Find Economists to Justify Their Bad Ideas

Art LefferI’ve written before about the fiasco that’s been going on in Kansas, Art Laffer’s Toxic Prescription. Since the 1970s, Laffer has been selling the same old supply side snake oil. The idea is that cutting taxes will so stimulate the economy that it will actually bring more money into the government in the form of taxes. It isn’t true that there is no such thing as a free lunch, but this supply side myth is not one of those free lunches. Given our low level of taxation, it literally never works. But over three decades of failure has not stopped Laffer from continuing to push this idea.

Kansas is ground zero for this right now. Sam Brownback used Laffer’s ideas as an excuse to do what Republicans always want to do: cut taxes. This is not about economics. This is religious faith, which is why intellectual mediocrities like Art Laffer are held up as heroes on the right. But things have not worked out. The tax cuts have not spurred growth — unemployment is higher than it is in surrounding states. And the government has had huge deficits. The response from Brownback is that these things take time. Just keep waiting and eventually all will be well. Of course, the cuts to education are here today. And if the tax cuts were going to work, they would have worked by now.

But I learned something new about the Kansas story from an article by Mark Binelli in Rolling Stone, The Great Kansas Tea Party Disaster. He noted, “Back in 2011, Arthur Laffer, the Reagan-era godfather of supply-side economics, brought to Wichita by Brownback as a paid consultant…” Interesting. I knew that Laffer had consulted on how to destroy the Kansas economy, but I didn’t know it worked that way.

Here’s the thing. Since supply side economics is a religious faith, you don’t go hire an expert who will look at your options and decide on the best one. You decide what you are going to do and then you hire Art Laffer as a way to justify it. Laffer isn’t an economist; he’s a public relations device. So bringing him in to “consult” is picking your solution, because you know that Art Laffer has only ever had one idea (and it isn’t even his). So if you hire him, that’s the idea that you will get.

Many years ago, I was the head of software development at a high tech start-up. We did amazing work — arguably the best work I’ve ever been part of. But there was a shake-up among the owners and the brilliant founder of the company was pushed out. Suddenly, the company was controlled by a bunch of money guys who didn’t understand anything about technology. They hired a friend with a technological bent, but who was totally unqualified for the job. And he proceeded to destroy pretty much everything that was developed under the company’s founder. That was mostly on the hardware side. But at one point, they decided to hire a software consultant. This guy did work on web-based applications. So he studied what we were doing and — What a surprise! — he decided that we should convert the software to be a web-based application.

This is my experience with consultants. In general, they aren’t the generalists you would think. Instead, there is one thing they know and when hired, they always find that the best solution is that one thing they know. In the case of my clueless employers, I don’t think they understood what they were doing. They probably met the guy at a bar and that was good enough for them. But clearly Brownback knew what he was getting. Laffer was not going to surprise him.

The whole thing is remarkably disingenuous. We actually know pretty well what works in terms of economic policy. But there are always conservative economists around to tell conservatives whatever it is that they want to hear. Alberto Alesina is there to tell them that budget cuts in a recession will create a boom. Greg Mankiw will tell them that stimulus spending is good when a Republican is in the White House, and that it is bad when a Democrat is in the White House. Funny that. And Art Laffer, the one trick pony, will tell them tax cuts will pay for themselves. We would be dealing with more open-minded people if we were dealing with the Spanish Inquisition.


H/T: Ed Kilgore

This entry was posted in Politics by Frank Moraes. Bookmark the permalink.
Avatar

About Frank Moraes

Frank Moraes is a freelance writer and editor online and in print. He is educated as a scientist with a PhD in Atmospheric Physics. He has worked in climate science, remote sensing, throughout the computer industry, and as a college physics instructor. Find out more at About Frank Moraes.

Leave a Reply

Your email address will not be published. Required fields are marked *