Monday, September 29, 2014

Moore vs. Krugman Cage Fight

Libertarian economist Mark Skousen is boosting a grand debate at the next FreedomFest in Las Vegas July 8-11, 2015. It's between NYT columnist and Nobel Laureate Paul Krugman and WSJ columnist and supply-sider Stephen Moore. They are going to debate a bunch of topics, one by one.
Red States vs. Blue States (especially California)… Flat Tax vs. Progressive Tax… Austerity vs Stimulus… Inequality vs. Growth… Market Healthcare vs. ObamaCare… Easy Money vs. Deficit Spending…Market Capitalism (USA) vs. State Capitalism (China)… and many more topics.
Of course, as a libertarian conservative I come down pretty hard on the Red State, Flat Tax, Austerity side of this argument. But I get what the other side is saying, and how faithfully the Paul Krugmans of the world represent them.

If you are a liberal you live and work, most likely, in a big organization like a school or a government bureaucracy. You experience the world as an underling. Your security and your livelihood depends on the "fairness" of your superiors or, failing that, your ability to curry favor with your bosses. Or maybe you are living on a government pension, Social Security or SSI or welfare. In other words these people are still living within the feudal system. They know that they depend upon a strong and generous patron that "takes care of them."

The idea of the market economy is terrifying to these people. They think: but what if my boss didn't like me? What if I got laid off? What if the employer came by and insisted upon "give-backs?" How would I pay my mortgage?

So these people buy the liberal Keynesian message. It is monstrous to talk about "austerity" and cutting government spending. How could people survive if their benefits were cut? It is monstrous to talk about a flat tax. The rich should pay more, because people like me on a fixed income can't afford any "cuts.".

The whole panoply of liberal macroeconomics is a response to the feudal culture of liberal voters. They want everything sewn up and guaranteed, from pensions to healthcare to benefits to job tenure.

But reality is that nothing is guaranteed. All government guarantees are made at the expense of what Amity Shlaes calls "The Forgotten Man," the folks that aren't represented by some special interest. So when the feudal horde of liberals demand to continue their pensions and benefits and rights undiminished through hard times like the Great Recession they are making it worse for people that don't have powerful interests on their side.

Because the best way to recover from a recession is if everyone is working hard to adjust to the new economic conditions. If the government beneficiaries had to share in the hardship, maybe they'd increase their work effort and contribute to the recovery.

Perhaps that's why this fall, after six years of the Obama administration and its full-on Keynesianism, average people are tuning out the message of the media and the administration that things are getting better.

The record of the Obama administration is that things have gone pretty well if you are well-connected, a liberal billionaire or a unionized government worker or a liberal activist or a government pensioner. But things are not so good for the rest of America and the rest of America is beginning to register its frustration.

It's right that Paul Krugman should represent the liberal feudal horde and their interest in their government benefits. But there is another story, and it's right for Stephen Moore to debate it with liberal icon Paul Krugman.

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