Paul Krugman is Super-SMRT, And Other Observations: a Long-Promised Fisking

His Krugman-ness in the NYT:

Mark Thoma sends us to the new Journal of Economic Perspectives paper(pdf) on optimal taxes by Peter Diamond and Emmanuel Saez. It’s a tough read (I’m still working on it myself), but there’s one discussion that I think helps make a useful point about current political debate.

Useful to whom?

In the first part of the paper, D&S analyze the optimal tax rate on top earners. And they argue that this should be the rate that maximizes the revenue collected from these top earners — full stop. Why? Because if you’re trying to maximize any sort of aggregate welfare measure, it’s clear that a marginal dollar of income makes very little difference to the welfare of the wealthy, as compared with the difference it makes to the welfare of the poor and middle class. So to a first approximation policy should soak the rich for the maximum amount — not out of envy or a desire to punish, but simply to raise as much money as possible for other purposes.

I was going to say "optimal for whom?" but Paulie K. kindly spells it out: the "optimal tax rate" is the optimal tax rate for the government. It maximizes the revenue of the state, and it's ability to engage in "other purposes." That phrase, however, is not so clear: what are these "other purposes"? How well are they performed? How well is that performance even measured? If the people decide that the government no longer needs to perform them, can they get their money back?

We're Not Gonna Have Barney Frank to Kick Around Anymore...

...Unless of course, he gets prosecuted. As he needs to be.

Ladd Ehlinger reminds us of how awesome he is:

"We Will Control the Market"

And there you have it, really. (h/t Protein Wisdom)

For 100 years these hyper-instructed ne'er-do-wells have been telling that, given sufficient money and authority, they'll get everything under control. That the business cycle is theirs to command. That the incentives and motivations of millions of human hearts could be perfectly shaped by legislation. Despite watching their house of  jokers collapse around them, they believe it still.

Monty, at Ace:

The “market” is not a thing to be managed, or a process to be controlled. The market is just an aspect of the natural world, working on the creatures who move through it. Merkel’s comment reflects the combination of arrogance and ignorance that is at the root of so many of our economic problems.

Yes. And the only thing wrong with this statement is that every GOP candidate is not shouting it from the rooftops, all the time. Every quarter the GDP is "unexpectedly" less than envisioned, and yet the premise of progressive politics -- that a learned technocracy can manage the wealth of the land better than the people -- remains a truism in the minds of too many people. They will continue to believe it until the bottom drops out.

Whereupon, they will eulogize their fallacies as "noble".

Stop Newt Before He Gets THE CHILDREN

GET IN MAH BELLY!

When I was 15, I had a work-study job at my Catholic high school. Twice a week I cleaned up the art room. I didn't like it very much, but I did it.

Newt Gingrich basically suggested the same thing (h/t Protein Wisdom). Actually, he suggested something better, because the kid janitors would be paid in actual cash money. All I got for cleaning clay-wheels every week was a break on my tuition.

Naturally, proggies shriek in terrified indignation:

You are probably one of the most disgusting human beings I’ve never met!
I want my neighbors 9yr olds or 14 yr olds cleaning up behind my children while I focus my children onto focusing on their education and letting my children to be “KIDS”.
Everyone knows that you Repugnants wants to model our society after China and make everyone a slave to Corpratism. We get it!
I don’t mind working my fingers to the bone but………….CHILDREN…………Really???

We are constantly told that poor kids are forced into the drug trade or worse from lack of economic opportunity. I don't see how giving a kid a job that pays $8-16 an hour doesn't constitute an economic opportunity. Nowhere does Newt say that the child labor laws would be abolished; at best, they'd be amended. We're not talking about a 12-year-old working 40+ hours a week and missing out on school; we're talking about maybe 10 hours a week, before or after school and weekends.

Am I really to believe that a kid who grows up in a poor, dilapidated neighborhood, with one or more parents missing, getting no breakfast except what the school provides, marking time in a broken public school earning a diploma that won't be worth the paper it's printed on would be objectively HARMED by earning some money pushing a mop around?

Really?

The Greatest Trick the Socialists ever Pulled was Convincing the World They Didn't Exist...

And like that... they're gone.

The reductio ad Hitlerium is an irritating logical fallacy, which almost never serves to improve understanding or conversation. Calling the OWS crowd Nazis, or even fascists, is a stretch. That needs be said before anything else.

But pointing out what Nationalsozialistische Deutsche Arbeiterpartei means is a handy and fun way to irritate socialists, as Ladd Ehlinger has discovered. I've been round the block with lefties desperate to argue that nothing about the Nazi's was left at all (keep scrolling), so I sympathise.

It all comes to how the word "socialist" is defined. Typically, those on the Left prefer to define "socialist" as "one who favors ending private property." This allows anyone who hasn't gone that far left to escape the title of "leftist" altogether. By this and similar ellisions, the Left pretends to be the Center.

But I prefer to define "socialist" as "one who favors the use of direct political power to remake society according to principles of universal justice." I like it because it allows the myriad of squabbling social thinkers, from LeFebre to Lenin to Mussolini to Mao to be recognized according to their common traits. It puts all the tyrants who covered their tyranny in the cloak of True Justice in a single pot.

And it allows us to draw distinctions between them. We can see Progressives, Mensheviks, Trade-Unionists, Corporatists, Fascists, Nazis, and Communists as similar, but also note their wide and obvious differences. We can grant that your average "liberal" Democrat has no intention of carting anyone off in a boxcar, while continuing to point out that their calls for "unity" are code for "now stop arguing with us."

A few objections:

• But Nazis and Fascists (and no small number of Progressive Democrats) hated Communists. If Communists are Socialists; how can Nazis, etc. be Socialists?

Answer: Large political/philosophical movements engage in vicious infighting all the time. See also, Christianity in the 16-17th centuries. For that matter, the Communists hated and murdered other Socialists with great regularity. No history of the Russian Revolution is complete without tracing the roles played by the Mensheviks and Socialist Revolutionaries in the Bolshevik rise to power, and the cruelty with which the Bolsheviks repaid them.

• Isn't this just a cheap method of putting Progressive Democrats in the same boat as Fascists and Communists?

Answer: Not at all. In fact, it works within the way Progressives think of themselves: as sensible radicals who oppose totalitarianism. A Progressive who accepts my definition of "socialist" can still say "Sure, I want to see society change, and am prepared to use the law as a tool to bring that change about. But I'm not going to impose change at the point of a bayonet. I'm humane and have a conscience."

As evidence for my assertion, I invite anyone to read Section III of The Communist Manifesto, wherein Marx lists the varieties of socialism which fail to meet his standard of scientific materialism: Feudal Socialism, Petit-Bourgeois Socialism, German or "True" Socialism, Conservative Socialism, etc. If Marx could admit that numerous and mutually contradictory versions of socialism existed, why cannot we?

Gingrich: Comparisons and Myths.

I've always kind of liked Newt Gingrich for his brains and brashness. I've also often wondered about his judgement (having an affair while sticking it to Clinton over Lewinsky? Really?). Now that Hermann Cain has hit his first post-bounce drop, I'm prepared to lean toward him a little.

In the AmSpec, Jeffrey Lord compares Gingrich to Churchill. The parallels are interesting, but more interesting is this:

Not to be forgotten is what Fox News commentator Juan Williams, recently sitting next to Gingrich on the set of Special Report with Bret Baier, delicately referred to as the former Speaker's personal "baggage." By which Williams means the Speaker's three marriages, the extra-marital business and all the rest. The famous myth of the first Gingrich divorce is discussed here by Gingrich's daughter Jackie Gingrich Cushman, who was present at the time. Surprise, surprise -- fact, says Ms. Cushman, is different than left-wing fiction. The first Mrs. Gingrich, a private person, is very much still alive, present and accounted for and not deceased as is the tale. The story runs roughly that the dastardly Newt took divorce papers to his dying wife's bedside when she had no idea a divorce was in the offing, shocking her as she lay dying. In fact Mrs. Gingrich, says her daughter, had herself requested the divorce long before Gingrich entered her hospital room. The story, says Cushman, is fiction from start to finish. Gingrich's political mistake was not understanding that such a personal moment would be distorted and used by liberal opponents. Out of such a moment perhaps comes the Newtonian understanding of the need for a political rapid response team whose sole purpose is to flag political untruths on the spot. Be that as it may, this tale shows the endurance of a political Bigfoot tale, the political equivalent of the fictional monster repeatedly spotted but mysteriously never actually captured because, of course, in fact it doesn't exist.

The art of political judgement differs not greatly from the art of the bloodhound. One must learn to tell false scents from true ones. If Gingrich isn't really as personally awful as legend has it, then maybe -- just maybe, he has mellowed, and like Churchill, knows what the hour demands.

Of course, not everyone is prepared to embrace this rise. Robert Stacy McCain seems more hostile to Gingrich than he was to Rick Perry, which is saying something. This I cannot understand. Preferring Hermann Cain to Newt can be defended on conservative personal and policy preferences. Preferring Mitt Romney to Newt smacks rather of taking one's ball and going home.

Bye-Bye, OWS

Marybeth Carragher, who lives in a building overlooking the park, said she and other residents were apprehensive about the city’s plan to let the protesters return, without their tents. “I think my neighbors and I are very thankful that the mayor acted,” she said, “but we remain completely outraged for having to endure this for nine weeks.”

My New Favorite Word for the Left...

Oikophobic. (This is why it pays to read Instapundit)

American patriotism is not a blood-and-soil nationalism but an allegiance to a country based in an idea of enlightened universalism. Thus our oiks masquerade as--and may even believe themselves to be--superpatriots, more loyal to American principles than the vast majority of Americans, whom they denounce as "un-American" for feeling an attachment to their actual country as opposed to a collection of abstractions.

Read the whole thing.

The Orwellian Inquisition Against Verbal Naughtiness

Katie Roiphe in the New York Times: (h/t Instapundit)

In our effort to create a wholly unhostile work environment, have we simply created an environment that is hostile in a different way? Is it preferable or more productive, is it fostering a more creative or vivid office culture, for everyone to vanish into Facebook and otherwise dabble online? Maybe it’s better to live and work with colorful or inappropriate comments, with irreverence, wildness, incorrectness, ease.
Is the anodyne drone typing away in her silent cubicle free from the risk of comment on her clothes, the terror of a joke, the unsettlement of an unwanted or even a wanted sexual advance, truly our ideal? Should we aspire to the drab, cautious, civilized, quiet, comfortable workplace all of this language presumes and theorizes?

Naturally the comments section brims with bland, earnest objections, the bulk of which suggest that said anodyne drone is precisely the goal they seek to achieve. Asked and answered, then. But one fellow sums up the progressive contrition perfectly:

Hey, I'm no professional feminist, but I'd rather let people decide for themselves what they find acceptable. That might include humoring some people who indeed seem Puritanical and hypersensitive. Who am I to tell them where "the line" is?

It does not occur -- or is not said -- that "humoring" the seemingly Puritanical differs not at all from accepting their interpretations and obeying their diktats, and that this achieves precisely the opposite of the free-thinking, tolerant universe that the "Who am I to ... ?" mantra prays for. The (seemingly!) Puritanical and hypersensitive have no qualms about saying exactly where the line should be, not merely for themselves but for everyone else. And they suffer no guilt about enforcing this line with all the power of the law.

Do you possess a mind, capable of distinguishing between good and bad? Then you can say where the line ought to be. Any who attempt to silence you do not share your good will.

Baltimore: Nobody Votes, Everybody Pays

This is what ennui looks like:

Judging from the sparse turnout at the Fells Point school, there were probably lots of stickers awaiting voters that may never show up. The same scenario was expected at the city’s other 289 polling places. City election officials were predicting only about 10 percent of the city’s 370,000 registered voters would cast ballots. That would make the Sept. 13 primary election look like it was crowded. About 23 percent voted in that primary despite a contested race between Rawlings-Blake and rivals Otis Rolley and Catherine Pugh.

There's a Republican and a Libertarian voting, and neither party even bothered to make an effort to contest this election. A city in which 10% of the population vote in a general election is a city with votes for the picking. The GOP and Libs should start a Baltimore Protest/Reform Party, and march through the streets until someone pays attention.

Of course, all that requires money and moral courage, neither of which are in abundance here.

This Magazine's Offices Got Firebombed

It says "100 Lashes if You Don't Die of Laughter"

Take it and Post it. They can't firebomb all of us.

The New Depression is On, Y'all...

So sayeth Carl Weinberg, chief economist at High Frequency Economics, to CNBC (h/t: Ace):

“Our view is that unfunded guarantees are worthless. Raising resources to fund the EFSF and the associated SIV will require diverting savings – domestic European savings, for the most part, not Chinese savings, and not those kept on reserve at the IMF – from either domestic consumption or investment,” he said.Raising that money within the next year from European savers will have a major effect on jobs and incomes as output and demand drop sharply, according to Weinberg, who believes that Europe will be back in crisis sooner rather than later.“We predict a catastrophic contraction of GDP in Euroland in a combined monetary and real-economy event," he said. "The event we envision is much more akin to the Great Depression of the 1930’s than to any business cycle we have experienced in our lifetimes.”

And what happened after the Great Depression in Europe?

I say we let the Germans win this time. Help them out, if possible.