More fundamentally, Mr. McConnell’s stand puts the lie to the Republican pretense that its new monetarist and supply-side doctrines are rooted in its traditional financial philosophy. Republicans used to believe that prosperity depended upon the regular balancing of accounts — in government, in international trade, on the ledgers of central banks and in the financial affairs of private households and businesses, too. But the new catechism, as practiced by Republican policymakers for decades now, has amounted to little more than money printing and deficit finance — vulgar Keynesianism robed in the ideological vestments of the prosperous classes.
This approach has not simply made a mockery of traditional party ideals. It has also led to the serial financial bubbles and Wall Street depredations that have crippled our economy. More specifically, the new policy doctrines have caused four great deformations of the national economy, and modern Republicans have turned a blind eye to each one.
You can’t say it enough- the modern wingnuts would primary Reagan for insufficient fealty to Reaganism.
MikeJ
You can’t call what they believe even “vulgar” Keynesianism. It has as much to do with Keynes as something totally unrelated to Keynes.
JCT
But don’t forget– according to our next Speaker of the House (the all-knowing Boehner), he doesn’t pay attention to these economists and the CBO — that’s all Washington insider, pointy-headed nonsense. He’s going to listen to the American people and *they* want the wealthy to keep getting their big presents.
Really, the Republicans are standing up on Capitol Hill with their fingers in their ears yelling “La La La La”.
We are headed for deep trouble.
Corner Stone
Shoot. Your hero would be the modern day right side equivalent of Kucinich.
Considered a joke and not able to win one state primary.
Mark-NC
Wow – even Republicans are abandoning Republican.
It’s a shame there aren’t more of them that are sober.
leo
When did Keynes say, blow all your cash on rich people?
Emma
We are screwed, boys and girls. Once those yahoos take back the House, it’s going to make all the stuff we’ve seen so far look like sunday in the park, ice cream cones and all.
slag
Typical. When conservative “ideals” fail, just pretend they were liberal ideals masquerading as conservative ones.
And I’ve never met a real Republican who actually used to believe this stuff:
They’ve always said they believed this stuff. Just like they still say they believe this stuff. I see no evidence that they ever believed it.
slag
@Emma: Well, I’ve already blown my political donation cash for this year on the DSCC. You should too. We all should.
khead
Odd that Mr. Stockman jumps from 1981 to 1984 in discussing Reagan while leaving out any mention of 1983…..
Duke City Roller (fmr Tank Hueco)
Sure, it’s a disaster in the real world, but as long as it works in theory…
K. Grant
Whaat? I thought Obama was the reason for all of our problems. Hmmph. Both the right and left tell me this is so, so it must be so.
Alan
I’m not sure Krugman would agree the Republicans offer “recycled Keynesianism.”
Corner Stone
@Duke City Roller (fmr Tank Hueco):
C’mon man! I always enjoyed your handle because it made me think of Hueco Falls which I stupidly have been down without a tube during flood stage conditions on more than one stupidly drunken occasion. I thought I broke my leg one time. Found out I didn’t and then proceeded to go through a couple more times.
Good times, good times.
Alan
@Emma: Yeah, somehow they’ll manage to blame the commie Democrats for a secret plan to destroy our economy while the GOP starts two additional wars against Iran and North Korea and instituting more tax cuts for Jesus.
Corner Stone
@khead: Do you mean when they reset SocSec? In order to “fix” it?
General Stuck
All you had to do was watch McConnell and Boehner on FNS this morning regurgitating Wall Street Editorial Board and Teatard approved evil soshulist liberals are to blame talking points. They are all in for Oligarchy now, and nobody can do anything about it. It is a cold revolution and lies are no vice in the pursuit of anarchy, and may those with the highest caliber of political debase win.
burnspbesq
Surely the irony of Reagan’s former budget director assuming the role of Chicken Little is not lost on anyone. Where were you 30 years ago, Dave?
burnspbesq
Are my eyes playing tricks on me, or did the typeface and line spacing on this blog change in the last hour?
Belafon (formerly anonevent)
@Alan: The one thing I found annoying in the article was his need to bash Keynesianism without pointing out why. He doesn’t like what Friedman did, but doesn’t take it to task at the end.
General Stuck
@burnspbesq: Happens to me all the time, but I been away from the computer till just a few minutes ago. Sometimes the font size gets so small I have to zoom it with my FF view tool. And what is really weird is when I tinker with the colors and font on my blogger blog, it also changes slightly, but noticeably on BJ pages. Spooky FSM stuff. I prolly shouldn’t even be talking about it, no telling what might happen.
jl
Stockman actually left the GOP ‘Keynes for the rich’ program during the Reagan administration. He realized the supply side tax cut program had gone badly wrong when the GOP started (paraphrasing Stockman at the time) really feeding at the trough. But, like most Very Serious People in positions of power, he said nothing and didn’t rock the boat.
So, as commenters above mention, he now papers over the real Reagan record.
khead
@Corner Stone:
Yes….and…
@burnspbesq:
Yes
Fuck Stockman. I only accept penance from former GOPers who run blogs and post good cat pics.
Full disclosure: I jumped ship 4-5 years before John.
Stillwater
@Alan: I’m not sure Krugman would agree the Republicans offer “recycled Keynesianism.”
You know those drawings where you can see both a pretty young girl and an old lady, but not at the same time? Krugman just focuses on the pretty young girl.
Stillwater
@Alan: I’m not sure Krugman would agree the Republicans offer “recycled Keynesianism.”
You know those drawings where you can see both a pretty young girl and an old lady, but not at the same time? Krugman just focuses on the pretty young girl.
Duke City Roller (fmr Tank Hueco)
@Corner Stone:
I’m glad I I brought back so many good memories. :) But I’m moving to Albuquerque at the end of next month and I need to break in a new (hopefully equal in quality) name before I’m there.
Also, on a completely unrelated note (checks weather.com), it’s only 81 there and it’s 102 here in Waco. The missus and I can’t wait.
fucen tarmal
@burnspbesq:
the country wasn’t fucked up then, so his ideas were still good.
what kills me, isn’t the rich folks who support this trickle down shit. its guilt free religion, and commitment free sex, for people who can’t have either, so they have tax free wealth accumulation. sure, in theory they should do stuff with it, and wealth is a responsibility and all that, but seriously folks, try the veal, who here is from out of town? no one is actually preaching that side, the responsibility to reinvest in job creating industry, or donate to charities who deal in places where budgets have been slashed…no one is asking for the payoff for the trickle down….
what kills me are the middle class and relatively poor jagoffs who preach this junk, oblivious to the fact that it isn’t happening, and it isn’t helping them….i guess it makes them feel rich to mouth the lines, like buying a lottery ticket, so you can fantasize about winning.
Alex S.
McConnell is not practising a “vulgar Keynesianism”. That would imply that he actually tries to improve the economy which he doesn’t. Stockman is almost there (“ideological vestments of prosperous classes”), but stops just before that.
General Stuck
@Duke City Roller (fmr Tank Hueco):
Welcome to the Land of Enchantment. I suppose you will be working at the Albuquerque VA. It is one of the better ones imo, but it sits in the SE part of town that once was called The War Zone for the crime wave that took it over in the 90’s. It is still a bad neighborhood, but not as bad from what I hear. I used to ride my bike down Central Ave. at night and listen to all the gunshots from nothing better to do. I rarely stopped for love nor money.
Duke City Roller (fmr Tank Hueco)
@General Stuck:
Thanks for the greetings. I visited (now long lost) family in ABQ in 1983 as a kid and fell in love with everything about the state. Now, at 36 I’m thrilled to be there for good. I work for Veterans Benefits Administration, so I’ll be working in the federal building downtown, instead of SE. But I’ve heard plenty about the War Zone, and we’re looking for housing everywhere but there.
jl
I hope some good comes of Very Serious People type Republicans with some shred of decency left, like Stockman and Greenspan, start calling out the frauds and insane.
But I think the Stockman article has a few problems, and relying too much on what he says is risky. Going through the article, the following jump out.
He lumps all US public debt, federal state and local. Municpal bonds are much more likely to go towards public investment than federal debt. This makes a difference. Recent research finds much more evidence that public spending in the capital account (investment) increases growth. Standard macro and US national income accounting does not have capital accounts for public spending, though some countries do.
Greece is a bad example, and its crisis is as much a product of problems of Euro currency union as public debt. Even on the debt side, Greek government got snookered into sketchy derivatives trading that worsened its problems. Characterizing the Greek crisis as merely one of debt ratios is very misleading.
The 120 percent debt to GDP ratio bogyman. Another country sent to ruination due to almost 120 percent ratio was the US at end of WWII.
Stockman joins the incompetent Bowles and Simpson (the catfood commission chairmen) in lumping together all entitlements. Medicare is by far the biggest, and Medicaid a distant second biggest entitlement problem. Social Security is NOT a short or medium run problem at all (unless the Very Serious People decide to steal the Trust Fund money).
Stockman lumps together public investment spending like education and water projects with transfer payments as ‘entitlements’. You can argue that some education projects (like abstinence only) or some water projects (more big dams in lieu of water conservation) are stupid, or that some water project financing involve subsidies for rich farmers and ag corporations. But still, Stockman should not lump things like this.
Stockman says the GOP joined the Democrats in fiscal irresponsibility. That is nonsense. What happened under Clinton?
Then he ends with debt crisis mongering (the day of reckoning is now). That is nonsense. In fact the total burden of public debt is temporarily declining due to reduced costs of borrowing in a very weak, perhaps stallling, recovery following the worst economic downturn since the Great Depression.
On a wonkier note, Stockman seems to love Bretton Woods, and thinks that leaving it was a big contributor to current US and world problems with instability. I think that is doubtful. The US jiggered the rules of BW to place most of the burden of adjustment on countries that ran large trade and balance of payments deficits. That was just fine with US until we ran large deficits. I don’t think BW was viable in the long run because of the asymmetry the US imposed on the costs of adjustment between debtor or creditor nations.
Tsulagi
Yeah, and no telling what the 101st TeaNut Corps would do to Jesus if he did return. A long-haired, brown skinned, non-American born hippie who would likely oppose the 2nd Amendment and be fine with the 14th? Gitmo the fucker at least.
Ailuridae
@jl:
This is a good post that saved me a lot of typing.
Stockman is an asshole. On matters he isn’t lying about he tends to not know what he is talking about. Nothing good comes of quoting some crank like him approvingly because he agrees with you on one instance.
Kat
Ketchup-is-a-vegetable Stockman doesn’t know jack about Keynesianism, vulgar or otherwise.
Corner Stone
@burnspbesq: CTRL and then hit the + symbol.
Corner Stone
@Duke City Roller (fmr Tank Hueco): One of the many times I should not have survived my youth.
The river was free if you had the gas money to get there, and between 6 to 8 people per car we could split the camping overnight fee.
I remember thinking at more than one point that I was fucking deadmeat. Then I popped back up, swam to the side, grabbed a beer and went back for more.
Life didn’t mean much back then. What a bunch of dumb luck kids we were. Jumping off the chained off 60ft high cliffs into fast moving river water that was sometimes 8ft or less deep.
Darwinistic FAIL.
Montysano
@Alan:
But I take his point: it’s still the govt taking an activist role in the economy, but the recipients of the largesse do not = us. Median wages have been flat for decades now; this is a feature, not a bug.
Wile E. Quixote
@Corner Stone:
No way dude. Take the glass half full approach instead. You’re living proof of the Nietzschean adage that whatever doesn’t kill you makes you stronger. Compared to you John Galt is a punk ass bitch.
Professor
Now I was reading the Private Eye magazine (issue 1267) and I found a cartoon which was hilarious:
A masochist says ‘I should suffer’.
A sadist says ‘You should suffer’. and
A Deficit Reductionist (Hawk) say ‘ Someone unspecified but definitely NOT me should suffer’. This is the age we live in. Have you ever seen an unemployed Deficit hawk before?
jl
I prefer the terms ‘deficit chickenhawk’ and ‘deficit vulture’.
When the catfood commission issues its propaganda screed, or rather ‘report’, and Congress is asked to make another go at destroying Social Security, then we can break out ‘deficit hyena’.
Corner Stone
@Wile E. Quixote: I survived because I am a royal bad ass. The rest of those little bitches got capped, drowned or died in DWI escapades because they weren’t as good, talented or deserving as me.
I am obviously more worthy than they, the sad fucks.
JGabriel
I just read the Stockman piece. Stockman’s analysis of how we got here is pretty good (excepting the gold standardism), but his solution kinda sucks. Austerity and balancing the budget are not going to get us out of this recession.
They’re actions we should take next time the economy is running well, if it ever runs well again. In the meantime, we should be focusing on whatever stimulus we can get through the back door.
.
JGabriel
John Cole @ Top:
I think that’s a needlessly generous assessment of Reagan. All Bush did was follow through on Reagan’s rhetoric, which Reagan only failed to do because he had Democratic congresses. Do you honestly think Reagan would have restrained the 2001-2007 GOP congresses any more than W.?
.
JGabriel
Alan:
Good point. I kept wishing that Stockman’s column had a comments section, just to point out that transferring wealth, such as it is, from the lower and middle classes to the already wealthy isn’t Keynesianism – it’s pauperization.
.
D-Chance.
When you’re thirsty, you drink to hydrate; when you’re fully hydrated, you don’t continue gulping down the H2O.
Too bad today’s fools don’t understand.
Fax Paladin
@Duke City Roller (fmr Tank Hueco): And the air conditioning was out today where I worked. Fun Times.
dms
@Tsulagi:
Brown-skinned? You must be joking. That’s not the image modern Christians, or any Christians, have of Christ. It’s the long-haired, dirty blond, surfer dude they have in mind.
They’d still Gitmo him, though.
mb
Thank you, David Stockman. Now go fuck yourself.
liberal
@jl:
Greenspan? Decency? Are you out of your fucking mind?
Gian
not at all sure if this is way late, but this sounds like the same stockman who called reagan’s tax cuts a trojan horse.
before knifing him, read this, and then, if you think that he deserves it, knife him, but he’s been more honest than most (hence the famous woodshed with St ronnie)
http://www.theatlantic.com/magazine/archive/1981/12/the-education-of-david-stockman/5760/
Up in Canada
Scanning comments, I note the usual references to Reagan and what he did. After watching Obama for 18 months still waiting for him to do something positive for those that voted for him. I voted for him believing that he would lead us to a better place.
I find that we are now in Afghanistan until 2014. The British stated they are in there until then, and I do not believe that they intend to be alone. Social Security will be reformed next year based on the recommendations of a group that hates the concept. They desire to destroy FDR’s great achievement and Obama apparently is more than willing to let them take a shot. The wars that last for ever will prevent any significant changes since no money is left to do that hopey, changey stuff.
This president still has two plus years to live up to the expectations that he encouraged in the campaign.
Kat
@Up in Canada:
What David Icke wrote about Barack Obama amid all the extraordinary hype before he came to office.
As xnewsnow asks, Recognise him now?
Icke may be barking mad, but he may also be right.
rickstersherpa
@JGabriel: Actually, Krugman would probably agree with Stockman that tax cutting while increasing the defense budget and not cutting the domestic budget is a kind of Keynsian, just not a particularly good kind of Keynsianism. An interestig historical note, which Krugman often reminds his readers of but apparently most do not grok, is that Krugman worked in the Reagan White House in CEA from 1982-84 when Stockman was the Director of OMB.
Floating exchange rates probably should have worked as Freidman predicted but for two things which he should have taken into account. One, that the U.S. dollar continuing role as the “reserve” currency in place of gold would mean that it would be chronically overvalued. Two, that other countries (principally Japan, Germany, and finally China), would manipulate their currencies to support export led growth strategies with the U.S. as the importer of last resort. (UPDATE: And the U.S. Government would not respond, first because of its percieved imperial interests in the Cold War and obtaining German, Japanese, and then Chinese support, and later because as the Government became dominated by the “Finanical Interest,” that interest saw great profits in shifting funds from foreign lenders to U.S. borrowers, private and Government, and wanted to keep the “music playing” to use the words of former CITIBANK CEO Bob Prince.
Nixon’s decision to abandon Gold redemption in 1971 was one part good policy and (of course naturally with Nixon) a selfish political tactic to help his reelection in 1972 (since he was continuing the Vietnam War principally as a reelection tactic, a a little economic sabotage is small potatotes). The economic problem was that the U.S. had a growing trade deficit and current account deficit with Japan and Germany as both nations had recovered from WWII and were now becoming economic competitors with the U.S., a U.S. that had further weakened itself with a vast and foolish expenditure in Vietnam. Nixon tried to get Germany and Japan to both revalue their currencies against the dollar and the price Gold in order to avoid the embarrassment of devaluing the dollar under Bretton Woods. When that did not work, Nixon delivered his big F-U to them and the world economy by blowing up Bretton Woods. The Oil Shock that followed in 1973-74 was perhaps invevitable with the U.S. production peaking in 1970 and rising consumption in Europe and Japan, but this unhinging of the world financial system to serve both the personal political interests of Nixon and U.S. percieved imperial interests was a precipating event. For all that Nixon did, I again refer folks to Rick Perlstein’s “Nixonland.”
Ab_Normal
@Kat:
David Icke? As in Disguised Reptilian Overlords rule the world David Icke? Sorry, the “barking mad” keeps me from taking him seriously…