Paul Krugman: Why Jeb-onomics Is Just Voodoo Economics All Over Again
Make no mistake, Paul Krugman writes in Friday's column, no matter how much "Jeb!" tries to distance himself from his last name, what he is offering up economically speaking is the same failed conservative ideology that his own father even recognized as "voodoo economics."
In his announcement speech for the presidency this week, Bush made the absurd promise that he would double the country's economic growth to 4 percent. First off, as Krugman points out, no one knows how to do that.
I’ll get to Jeb!onomics in a minute, but first let me tell you about a dirty little secret of economics — namely, that we don’t know very much about how to raise the long-run rate of economic growth. Economists do know how to promote recovery from temporary slumps, even if politicians usually refuse to take their advice. But once the economy is near full employment, further growth depends on raising output per worker. And while there are things that might help make that happen, the truth is that nobody knows how to conjure up rapid productivity gains.
Why, then, would Mr. Bush imagine that he is privy to secrets that have evaded everyone else?
One answer, which is actually kind of funny, is that he believes that the growth in Florida’s economy during his time as governor offers a role model for the nation as a whole. Why is that funny? Because everyone except Mr. Bush knows that, during those years, Florida was booming thanks to the mother of all housing bubbles. When the bubble burst, the state plunged into a deep slump, much worse than that in the nation as a whole. Taking the boom and the slump together, Florida’s longer-term economic performance has, if anything, been slightly worse than the national average.
The key to Mr. Bush’s record of success, then, was good political timing: He managed to leave office before the unsustainable nature of the boom he now invokes became obvious.
Apart from this tiresome tendency to take credit for merely having somewhat good timing, Bush is just promising the radical plutocrat tax-cutting plan for the country that has already been demonstrated to be an utter failure in places like Kansas. And he is selling that notion by promising growth. Same old dangerous wishful thinking as always. "Way back in 1980, George H.W. Bush, running against Reagan for the presidential nomination, famously called it 'voodoo economic policy,'" Krugman points out. "And while Reaganolatry is now obligatory in the G.O.P., the truth is that he was right."
So, there was this one time when a Bush was right.