Thursday, February 18, 2016

Kitchen Sink #4: "Left-Leaning Economists"

Major Bernie Scandal Alert! Four Democratic economists who served at various times as economic advisers to Presidents Clinton or Obama have written a scathing open letter, accusing another economist not even affiliated with the Sanders campaign of doing math which does not add up to their unspecified specifications.

Gerald Friedman of UMass-Amherst, who recently received progressive accolades for his own scathing takedown of a Wall Street Journal hit piece falsely asserting that Sanders's single payer health care plan would bankrupt the middle class, now finds himself the target of attacks from the neoliberal centrist faction of the Democratic Party. And Bernie Sanders himself has been declared guilty by association.

New York Times columnist Paul Krugman, in one of a whole series of recent breathless posts damning progressive "unicorns," and other perceived enemies of the Neoliberal Order, is demanding that Sanders immediately disown Friedman -- with whom he has no direct association at all. "Sanders needs to disassociate himself from this kind of fantasy economics right now," Krugman shrilled. "If his campaign responds instead by lashing out — well, a campaign that treats Alan Krueger, Christy Romer, and Laura Tyson as right-wing enemies is well on its way to making Donald Trump president."

 As I responded in my published comment, this kind of fear-mongering McCarthyesque attack is reminiscent of the media hysteria over the Obama-Jeremiah Wright controversy during the 2008 campaign. As you may recall, Obama dutifully "disowned" Wright after the pastor preached what were deemed by the Establishment to be un-American sermons.

The source of the latest angst is a newer analysis by Friedman, leaked to CNN, which purportedly claims that Medicare for All would boost economic growth by more than five percent. 

The false equivalency engine immediately went into overdrive. The Four Wonks of the Neoliberal Apocalypse took up their pens of outrage, even going so far as to set up their own WordPress blog which they call "letters to sanders." So I guess we can expect more scathe in the future. Here is their first entry, in its entirety:
  Letter from Past CEA Chairs to Senator Sanders and Professor Gerald Friedman -- Posted on
Dear Senator Sanders and Professor Gerald Friedman,
We are former Chairs of the Council of Economic Advisers for Presidents Barack Obama and Bill Clinton. For many years, we have worked to make the Democratic Party the party of evidence-based economic policy. When Republicans have proposed large tax cuts for the wealthy and asserted that those tax cuts would pay for themselves, for example, we have shown that the economic facts do not support these fantastical claims. We have applied the same rigor to proposals by Democrats, and worked to ensure that forecasts of the effects of proposed economic policies, from investment in infrastructure, to education and training, to health care reforms, are grounded in economic evidence.  Largely as a result of efforts like these, the Democratic party has rightfully earned a reputation for responsibly estimating the effects of economic policies.
We are concerned to see the Sanders campaign citing extreme claims by Gerald Friedman about the effect of Senator Sanders’s economic plan—claims that cannot be supported by the economic evidence. Friedman asserts that your plan will have huge beneficial impacts on growth rates, income and employment that exceed even the most grandiose predictions by Republicans about the impact of their tax cut proposals.
As much as we wish it were so, no credible economic research supports economic impacts of these magnitudes. Making such promises runs against our party’s best traditions of evidence-based policy making and undermines our reputation as the party of responsible arithmetic. These claims undermine the credibility of the progressive economic agenda and make it that much more difficult to challenge the unrealistic claims made by Republican candidates.
Alan Krueger, Princeton University
Chair, Council of Economic Advisers, 2011-2013
Austan Goolsbee, University of Chicago Booth School
Chair, Council of Economic Advisers, 2010-2011
Christina Romer, University of California at Berkeley
Chair, Council of Economic Advisers, 2009-2010
Laura D’Andrea Tyson, University of California at Berkeley Haas School of Business Chair, Council of Economic Advisers, 1993-1995
Mind you, this letter was written immediately after renowned economist Thomas Piketty published an op-ed in praise of Bernie Sanders and his tax-the-rich, New Deal agenda. It follows a grand total of 170 economists who last month wrote their own letter endorsing Sanders's and Elizabeth Warren's plan to break up the big banks. (h/t Meredith.)

 The letter from the Fantastic Four dovetails ever so nicely with a New York Times editorial posing as a news story by Jackie Calmes, whose unabashed slant-fest was obliterated very ably by Doug Henwood, writing for FAIR (Fairness and Accuracy in Reporting.)

Henwood notes that most Bernie-bashing from professional Left-Leaners uses the same formula. Show some initial surface sympathy for his agenda (I always loved Single Payer!) before immediately pivoting to concern-trolling its "impracticality" in the Current Climate, and then finally building up to a crescendo of outright derision and mockery and straw man attacks. The mockery, as practiced by Krugman's Puppies, Rainbows and Unicorn-Hating Coalition, has now achieved true art form, iconic status. Henwood also reminds us that concern-trolling economist Goolsbee is the same duplicitous political operative who once assured the Canadians that Obama didn't "really" plan to overturn NAFTA. Goolsbee, since leaving the Obama administration and writing nasty Open Letters, also advises hedge funds in his spare time.

I wrote two separate responses to both of Krugman's authority-appealing posts on the Four Worried Wonks:
The four worried wonks worked for two centrist administrations. They falsely equate fraudulent GOP trickle-down with righteous FDR-style trickle-up/opening of the floodgates.  Krugman tellingly does not define "winners and losers." Could it be that under a President Sanders, the losers would be the plutocrats and the winners ordinary people now struggling just to survive?
The Four Wonks of the Apocalypse work for a party which has not served the interests of the plebes since the Clintons surged to power on the second wave of Reaganism. This neoliberal "Third Way" is loosely defined as free market conservatism loosely papered over with "social responsibility." 
 The select Democratic Wonk Committee on Bernie-Bashing Paranoia is about the fortunes of the Party, not the fortunes of the people. Why else would the DNC try to limit its primary debates? They were worried that the "conversation" would extend beyond the acceptable arguments between centrists and right-wingers. As Simone Weil wrote, political parties have one main goal: their own continued existence and hold on power. Once they gain power, they tend to forget the basic social contract.
Many of us are simply disgusted with this spate of fear-mongering and concern-trolling. We're all too aware that recent columns by Brooks, Blow, Friedman and Krugman all sound the same. And no, they're not corrupt or looking for jobs. They're simply banal.
The only logical response to these elite "concerns" is a big, fat group Meh.
A big, fat Meh.

And my follow-up to his Worried Wonkopalypse follow-up post, demanding that Bernie disown Friedman, himself, and us..... because if he doesn't fall into line, we'll get ourselves a President Trump:
OK, now I get it. Gerald Friedman is to Bernie Sanders what Rev Jeremiah Wright was to Barack Obama. The concern trolls are demanding A Major Disowning Speech. They want reassurances from Bernie that the teeming masses are not really coming after the sensitive elites with their pitchforks. They want Lloyd Blankfein to get over his crippling pathological fear that millions of bank-evicted unemployed people are lurking just beyond his heavily guarded compound(s.) And all Blankfein ever said was that struggling people shouldn't count on getting Medicare and Social Security while he rakes in a cool billion!
I'm not a wonk myself, so I have no way of knowing whether Friedman's math adds up. But this is just a distraction. Nobody is asking Hillary Clinton how her own math adds up. Campaigns are by their nature aspirational rather than mathematical. Politicians do want people to show up to vote, or so I would assume.
 Bernie Sanders is being held up to an impossible standard.
I stand by my comment in the previous thread. This is all about the Wall Street wing of the Democratic establishment wanting to hold onto power. Lesser Evilism is way past its sell-by date. The days when pundits and plutocrats could manufacture the consent of the masses through fear and smears are gone, baby, gone.
Friedman doesn't work for Sanders. Nor does Sanders refer to the Four Worried Wonks as right-wingers. Nor is he treating them with any disrespect (though god knows they mightily deserve it.)
Update: The Unicorn-Hating Collective is now a news story unto itself. Legions of aggrieved Wonks are joining Krugman (and of course Hillary Clinton herself) in playing the victim card. The Bernie Bashers are getting bashed all over the place by mere plebes. They're getting called out on their insufferable wonkitude, and their feelings are apparently hurt. I mean, the fact that we live in the only country on earth without basic health care for all its citizens is simply a matter of charts and math that the wonks work so tirelessly to invent. The New York Times, as ever, is On It: 
But there may be something broader going on here beyond the specific disagreements about growth assumptions, or cost savings from a single-payer health system, or how to regulate the financial system.
Behind closed doors, among the left-of-center policy types who populate the congressional offices, executive agencies and think tanks of Washington, I’ve seen enough eye rolls when Mr. Sanders’s name comes up to suspect something more tribal is going on.
The wonkosphere vs. Bernie clash is not just a story of center-left versus left-left. It is also a clash between those who have been in the trenches of trying to make public policy for the last seven years versus those who can exist in a kind of theoretical world of imagining what public policy ought to be.
Don't you lowly people realize that Wonks work all night on your behalf? Do you really think that politicians only have to answer to their constituents? Bernie Sanders will never, ever be able to make nice with the Wonk Collective, which realistically admits that lobbyists and bankers are people, too!

The article conveniently forgets to mention that Bernie once suggested Paul Krugman, wonk extraordinaire, to lead the Treasury Department. Methinks those wascally wonks doth protest way too much.


Meredith NYC said...

Karen...thanks for your excellent post here.
I am about to read the piketty piece...linked to by commenter in yesterday' krugman blog---was in le monde, then translated in guardian, uk

Meredith NYC said...

Karen.... I sent this to your blog last night but can’t find it. Slight edit.

See Daily Kos, Jan 15, 2016. Re regulating big banks.

“170 Top Economists Endorse Bernie Sanders’ Wall Street Reform Plan”. Article singles out Robert Reich, Dean Baker, James Galbraith, Brad Miller, William K. Black, etc

Did Krugman ever mention it? Where was this on the cable news, or on NYT op ed page? Was it even reported in main media??? This gets to the heart of our democracy---does the president represent the majority of citizens or the top few elites?

The article has link to full text and all signers of a letter publicly endorsing Sanders plan for Wall Street reform.

Letter says, “For free markets to work, there must be enough players to drive true competition.

For free markets to fail, there just needs to be too few players, with far too much power.”

“ ...the biggest banks must be broken up...a new Glass-Steagall Act...must be enacted.

.... Wall Street’s largest banks are now far bigger ...have every incentive to take excessive one’s been indicted for the fraudulent behavior that led to the 2008 crash..fines imposed were only a fraction of the banks’ potential gains.

Their lobbyists have succeeded in watering down Dodd-Frank reform.

Hillary Clinton’s more modest proposals do not go far enough. They call for a bit more oversight and a few new charges on shadow banking activity, but they leave intact the titanic financial conglomerates that practice most shadow banking....her plan does not adequately reduce the serious risks our financial system poses to the economy....Given the size and political power of Wall Street, her proposals would only invite more dilution and finagle.”

My thought is: From this standpoint--which candidate is more practical/pragmatic? How did the banks manage to make profits, poor babies, with Glass Steagall in effect from 1933 to 1994? This is the burning question we need answered.

Even Reagan didn't repeal GS---it took a Dem to do it, trying to be 'anti big govt' in the 90s, to get the conservative democratic vote. Same as his push to expand prisons and end welfare as we know it. All related.

How about a Krugman column on this and use the word finagle in the headline?

Jay–Ottawa said...

This has got to be the opening of a new front against Sanders by the club of left-leaning-really-right-wing-but-not too-too-far-from-center establishment wonks. You can find more of the same elsewhere. Look at E. J. Dionne Jr.'s latest essay over at Sheer & Co.'s Truthdig. Here's a taste:

"Democrats need to insist that while much work remains to be done, the United States is in far better shape economically than most other countries in the world. The nation is better off for the reforms in health care, financial regulation and environmental protection enacted during Obama’s term and should be proud of its energetic, entrepreneurial and diverse citizenry."

He goes to explain that unless Democratic candidates laud Obama, Trump's gonna move into the White House.

Dionne is a WAPO journalist and not an economist. But his blast undermining the Sanders camp is timed too coincidentally with that of the new Krugman front. If your hand is steady enough after reading Dionne's salute to Obama, scroll down to the comments to see how the readership receives Dionne.

Karen Garcia said...


Thanks for reminding me of the letter from the 170 economists. I included a link to it in the body of my post so it gets more notice.

Meredith NYC said...

thanks Jay, re Dionne. 'the United States is in far better shape economically than most other countries in the world." That's a Krugman line too.

The US is better off except for it's middle, working and poor classes.
Dionne outrageously ignores all the OECD rankings of various components of 'better or worse off',that show the US last or low.
Les Leopold's book 'Runaway Inequality" has all the charts and graphs comparing the US to abroad, and crucially, to its own better past.

Pearl said...

Karen: Had I not read your column I would never know about the murky goings on via Krugman's blogs, etc. How is an average voter able to learn about the neolib movement now getting ready to throw the roof on Bernie's head.

I hope when Hillary throws the usual attacks his way, Bernie continues to quote some accurate figures about unemployment, jobs, etc. etc. etc.

When Hillary quotes these 'left leaning' economists I hope she gets a scathing reply from Bernie.

Can't believe what is going on nor what more is to come. Keep us posted. I didn't see the great comments you sent Krugman but perhaps it was among the other blogs on this topic he wrote. Wonder if he will discuss this topic in his regular column that people know about.

Great report Karen. Hope you are getting some sleep.

Meredith NYC said...

Just to make everything a little more crazy! After Krugman's blog re Friedman/Sanders--here’s this in W. Post. What's next?

The economist who vouched for Bernie Sanders’ big liberal plans is voting for Hillary Clinton.
By Jim Tankersley February 18

"The first thing you should know about Gerald Friedman, the economist suddenly at the center of a wonk-storm over Bernie Sanders’ policy proposals, is that he does not actually support Bernie Sanders for president.

He likes Sanders. And he has written, in consultation with the Sanders campaign, an analysis that projects Sanders’ ambitious domestic agenda would raise economic growth to as high as 5.3 percent per year, yielding sustained income gains for the middle class.

But Friedman, an economist at the University of Massachusetts, says he’ll vote for Hillary Clinton.

“I support Clinton,” he said in an interview on Thursday. “I donate $10 a month to Clinton. I remember the woman who said, women’s rights are human rights. I think she did a great job as secretary of state. I agree with Bernie on economic issues, but there are other issues.”

wow... He donates $10/month to Clinton??? This guy is a little crazy. What's this economist's bottom line, women's rights, not economic rights? But the 2 are directly intertwined. Just what is going on??