Saturday, February 20, 2016
A Nobel Prize for Sanders...
A gaggle of high-powered, left-leaning economists, including Christina Romer, Alan Krueger, Paul Krugman, and others (and they really are big name economists) have cast, umm, a "bit" of doubt on the Sanders economic plan. Sanders claims it would essentially eliminate unemployment and poverty, raise median household income 38%, balance the budget and earn surpluses for the government, and bring about a new trial for Sacco and Vanzetti. Well, I'm not certain that Sanders actually made this last claim, but the aforementioned economists argue that it is no less likely than the other claims.
They are, of course, correct. Sanders' economic claims are flights of fancy, as ill-founded as Charles Fourier's claims that the oceans would turn to lemonade if socialist policies were adopted. Economic growth rate of 5.3%, unemployment falling to a record low of 3.8% even while labor force participation rate increasing from current 62% to 67% (i.e. enormous number of people entering the job market and having no trouble finding work), the 1.3 trillion USD deficit turning into "large surpluses..." What is interesting is that Sanders actually found economists who were willing to affirm that these miracles would indeed happen, although it turns out they are from U. Mass. Amherst, so the term "economist" must be used rather loosely. (This isn't really a smart aleck comment, BTW; heterodox economics is so different that it really should be thought of as a different academic endeavor.)
Even more amusing is that Sanders' wild claims left our gaggle of high-powered economists with egg on their faces, as they'd all just been raking Republican candidates over the coals for making far less extravagant claims, such as Jeb!'s claim that under his presidency economic growth would be 4%, which they all found outlandish. PK puts it particularly nicely: "Sanders needs to disassociate himself from this kind of fantasy economics right now." If a Republican had made such wild claims, Paul would not be calling for him/her to retract, he'd be spraying a firehose of invective, scorn, and general nastiness at the target. Come on, Paul, you used to be an economist. Call Sanders an ignoramous, the way you did in the old days when you were a real hero.
But on to the main point. Why a Nobel Prize in Economics? The Sanders campaign did not take this criticism from a number of noted economists passively, but rose to the challenge, diving straight into the heavy theoretical and empirical work, and came up with this crushing refutation. In the words of Sanders' chief policy advisor, the criticisms are baseless, because the critics are "the establishment of the establishment." Now there's an airtight proof for you! With brilliance like this, the Sanders' campaign should be a shoe-in for the prize, don't you think?
Photo: Greeks are finding their experiment with democratic socialism to be quite exciting.