Ouch

Cato-at-Liberty has some harsh words for Jon Chait:

For those who think that it’s just conservatives, such as Ann Coulter, who are mean-spirited, they should check out the new book by Jonathan Chait, a senior editor of the New Republic, entitled The Big Con: The True Story of How Washington Got Hoodwinked and Hijacked by Crackpot Economics.

I managed to get through the introduction and first chapter of Mr. Chait’s book. Alas, I could read no more. Here are some of Chait’s characterizations of supply-side economists and supply-side economics–from the 1970s to the present day–in those first 44 pages:

“Pseudo-economists”, “cult of fanatical tax-cutters”, “amateurs and cranks”, “patently ludicrous ideas”, “preposterous ideas”, “theological opposition to taxation”, “ideological fanatics”, “insane”, “detachment from reality”, “extremism of their agenda”, “triumph of the extreme”, “a cult”, “quasi-religious”, “totalistic ideology”, “crank doctrine”, “sheer monomania”, “plain loopy”, “magical”, “sheer loons”, “deranged”, “wingnuttery”, “utterly deluded”, “crackpot economic theories”, “lunacy”, “ludicrous,” etc.

You get the idea.

One of the worst features of modern political discourse is the inability of critics to distinguish between being crazy, and being wrong. The supply siders of the 1980s were not crazy (Jude Wanniski and George Gilder notwithstanding); they were simply incorrect. The supply-siders of later vintage believed, on very flimsy evidence, that tax cuts raised tax revenue, for the same reason that progressives believe, on what to me looks like very flimsy evidence, that their national health care program will be the first American health care program in history to realize net cash savings: it is much nicer if the things you earnestly long for do not involve any tradeoffs. Unfortunately, this is almost never the case*.

I've recounted elsewhere my experience with supply-side dogmatism at a conservative publication; it's both shocking, and deeply wrong. However, that doesn't make Jonathan Chait right. Even as I wrote that, Ramesh Ponnuru of National Review was writing this about the New York Sun:

Presumably what they mean is that the top income tax rate is higher than the revenue-maximizing rate, but I'm not sure why they think that it is. Bush's tax cuts appear to have caused revenue to be lower than it would otherwise have been, which suggests that we're already below the revenue-maximizing tax rate.

Which suggests that hard-core Lafferism isn't quite the monolithic dogma that Chait suggests.

Broadly, that's my biggest problem with the book: it's so terribly simplistic that you can't really learn anything interesting about the Supply-side movement, or Republican economic policy, except that Jonathan Chait hates them. Except I didn't really need a whole book to tell me that; two minutes with one of his articles is more than enough to convey Jonathan Chait's searing contempt for all those who disagree with Jonathan Chait.

Large swathes of economic history are left out, or their implications ignored, because they don't fit Chait's cartoon version of evil rich people swaggering about in top hats as their lackeys on K Street and in the think tanks cravenly put one over on the good and great American people. And he makes truly embarrassing errors that seem to indicate that he hasn't really mastered the economic theories he's dismissing, which makes one disinclined to trust the rest of the book. The result is a work that is, as Cato's poster notes, venomous--but without the usual compensating virtue of being amusing.

* The fact that Europe has generally longer lifespans than America at lower cost is multi-factorial, with the health care system the least important--or perhaps irrelevant--variable lost in lifestyle, crime, genetics, and even the way that statistics are collected dwarfing the role of health care. Likewise, on the cost side, there is an extreme degree of path dependence in the mechanism that allows French doctors to, for example, make less than an experienced RN in the United States, and other than slashing pharmaceutical payouts, which account for a trivial percentage of US healthcare spending, and moreover, save money on other procedures, no one has offered a plausible political mechanism by which the US could get there from here.

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Megan McArdle is a columnist at Bloomberg View and a former senior editor at The Atlantic. Her new book is The Up Side of Down.

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