KRUGMAN'S CALIFORNIA SCREAMIN'----- Chronicle of the Conspiracy
Join us as we discover, document, expose and challenge the bad people, the bad institutions and the bad ideas that stand in the way of wealth creation -- and show you how to fight back!
Monday, August 04, 2003
Think of this website as one of those purple lights that zap bugs dumb enough to keep flying into them. And think of the lies, distortions, biases and misquotations in Paul Krugman's New York Times columns as the bugs. What's that sound I hear? Zap! Zap! ZZZZAAAAAPPP! My, there are a lot of bugs today...
In Friday's column, Krugman describes a fantasy version of California's "slide into irresponsibility" in which big budget deficits are caused by irresponsible tax-cuts (not irresponsible spending), and it's all the fault of feckless Republicans (in a state utterly dominated by Democrats). Now Krugman is a very fancy economics professor from a very fancy Ivy League college, so we can at least assume he's got the budget math right. Can't we?
ZAP! David Hogberg caught Krugman in a humiliatingly simple math error, which surely the Times will be obliged to correct. Krugman wrote,
"As analysts at the nonpartisan California Budget Project point out, real state spending per capita was only 10 percent higher in 2002-03 than it was in 1989-90 — that is, most of the spending growth was simply a matter of keeping up with the population and inflation."
But Hogberg went to the CBP's website to fact-check this claim (Lord know the Times won't bother to do it). Hogberg notes in his Cornfield Commentary blog that CBP states,
"Per capita spending was $2,211 in 2002-03, as compared to $1,950 in 1989-90 (in 2002-03 dollars)."
Now let's see... I'm no Princeton professor -- I'm a Yale drop-out, in fact -- but I think Hogberg is right when he says that spending growth from $1,950 to $2,211 is 13.4%, not "only 10 percent." How can this be? Is it an innocent error? Is it rounding? Or maybe Krugman thinks that 10% sounds better with the word "only" in front of it than 13.4% does.
Remember the last time the Krugman Truth Squad caught the great economist in this kind of obvious error? It was back in April, when Krugman invidiously compared the ten-year cost of President Bush's tax cuts to the one-year wage associated with the new jobs it would create, in order to make the tax cuts seem absurdly large. Oh, how he and the rest of the leftist economics swarm howled when that bug got zapped! He wrote lame rationale after lame rationale on his website about it -- my favorite was when he wrote, pleadingly, "I am a competent economist, and know how to use numbers."
Well, what can we say? I'll just quote the oft-repeated refrain of Krugman's buddy and apologist, the leftist UC Berkeley economist Brad DeLong -- why oh why can't we have a better press corps?
What about that "nonpartisan California Budget Project"? ZAAAP! Matthew Hoy points out on his Hoystory.com blog that the CBP may be "nonpartisan," but it sure isn't non-leftist. Hoy notes that the CBP describes its mission as "Working to improve the economic and social well-being of low and middle income Californians..." It's funding comes from a number of left-leaning foundations, including the Streisand Foundation. As Hoy puts it: "yes, that Streisand."
If "nonpartisan" is what Krugman is looking for, then as D. J. McGuire suggested to me in an email, he should look at the work of the "nonpartisan" Cato Institute. In a recent report, Cato noted that California's real state spending per capita grew not "only" 10%, or even "only" 13.4% -- it grew 25.9%. What makes the difference? The "nonpartisan" Cato Institute measured from 1990 (the prior peak) to 2001 (the recent peak) -- that's the true measure. The "nonpartisan" CPB measured from 1990 to 2003, after some spending restraint had already gone into effect. ZAP-AP-AAAAAP!
Whatever the spending growth has been, Krugman justifies it by saying that most of it went to "the effort to hire more teachers and repair decrepit school buildings." That was necessary, according to Krugman, because "Proposition 13, the 1978 cap on property taxes, led to a progressive starvation of California's once-lauded public schools."
As a parent, I'm always somewhat put off when a childless person like Krugman shoots off his mouth about what's wrong with public schools, usually concluding that throwing money at them is the answer. The reality here in California, 3000 miles from Princeton, is that the schools are not much better than they were a decade ago -- even after throwing a lot of money at them.
So we can't cut spending (because, according to Krugman, it hasn't been growing excessively to begin with, and what growth there has been was mostly for education). So let's raise taxes. That leaves Robert Musil wondering, on his Man Without Qualities blog, why Krugman, an economist,
"...doesn't even ask the most basic question: Can California raise taxes without damaging the State's economy through creating an even more uncompetitive business climate? The answer is almost certainly 'no.' According to the latest data (1999-2000) from the U.S. Department of Commerce’s Bureau of the Census, California is eighth highest among the states when tax burden is compared on the basis of personal income and seventh-highest per capita..."
But Krugman pretends that the problem is that Republicans -- a minority in the state legislature, won't "make realistic proposals for spending cuts." James Sherk, senior fellow for economics at the Evangel Society, pointed out to me in an email that the "nonpartisan" CPB has, itself, documented the fact that California Republicans have proposed spending cuts, here and here. But, what's "realistic" -- and to whom? To Krugman? To California Democrats like Governor Gray Davis?
Krugman, of course, blames none of California's problems on Davis, and treats the move to recall Davis as a sham:
"...voters are being invited to focus not on hard choices but on personality. Replacing Gray Davis with someone more likable isn't going to pay the bills."
As a Californian, I can assure you that Davis' personality is the least of my worries. As fellow Californian Matthew Hoy points out, Davis has his own idea of "realistic" -- and it's about pandering to special interests in a way that has a lot of California voters quite upset.
"What is interesting about state spending are charts comparing the 2002-03 fiscal year (Page 3) spending to the 2003-04 fiscal year (Page 48)... There is only one category of funding that actually increases in the midst of this budget crisis: 'Youth & Adult Correctional.' That's right, the outrageous contract with the prison guards union that Davis approved after they made a large contribution to his re-election campaign."
ZAAAAAA-ZAAP!
poorandstupid.com
Posted by Donald Luskin at 8:05 AM | link |
