the real problem here is that media organizations are looking for unicorns: serious, honest, conservative intellectuals with real influence. Forty or fifty years ago, such people did exist. But now they don’t.
.. First, while there are many conservative economists with appointments at top universities, publications in top journals, and so on, they have no influence on conservative policymaking.
.. What the right wants are charlatans and cranks, in (conservative) Greg Mankiw’s famous phrase. If they use actual economists, they use them the way a drunkard uses a lamppost: for support, not illumination.
.. under Obama the director was always someone who was interested in real policy research, listened to what experts had to say, and was willing to change views in the face of evidence.
.. Obviously none of this is true in Kudlow’s case. He’s basically a TV personality, whose shtick is preaching the magic of tax cuts, and nothing – not the Kansas debacle, not the Clinton boom, not the strong job creation that followed Obama’s 2013 tax hike – will change his mind. And it’s not just that he’s incurious and inflexible: selling snake oil is his business model, and he can’t change without losing everything. And that’s the kind of guy Republicans want.
All this means that if you get a conservative economist who isn’t a charlatan and crank, you are more or less by definition getting someone with no influence on policymakers. But that’s not the only problem.
.. even aside from its complete lack of policy influence, it’s in an advanced state of both intellectual and moral decadence – something that has been obvious for a while, but became utterly clear after the 2008 crisis.
I’ve written a lot about the intellectual decadence. In macroeconomics, what began in the 60s and 70s as a usefully challenging critique of Keynesian views went all wrong in the 80s, because the anti-Keynesians refused to reconsider their views when their own models failed the reality test while Keynesian models, with some modification, performed pretty well. By the time the Great Recession struck, the right-leaning side of the profession had entered a Dark Age, having retrogressed to the point where famous economists trotted out 30s-era fallacies as deep insights.
.. What accounts for this moral decline? I suspect that it’s about a desperate attempt to retain some influence on a party that prefers the likes of Kudlow or Stephen Moore. People like John Taylor just keep hoping that if they toe the party line enough, they can still get on the inside... we’re looking at asymmetric polarization... Am I saying that there are no conservative economists who have maintained their principles? Not at all. But they have no influence, zero, on GOP thinking... News organizations don’t seem to have figured out how to deal with this reality, except by pretending that it doesn’t exist. And that’s why we keep having these Williamson-like debacles.
‘Tired of the wait game’: White House stabilizers gone, Trump calling his own shots
Other than Defense Secretary Jim Mattis, the lone remaining enforcer is Kelly. But his power as chief of staff has been diminished. Officials said the days of Kelly hovering in the Oval Office morning to night and screening the president’s calls are over. Trump is largely circumventing Kelly’s strict protocols.
The president recently reached out to some people Kelly had sought to excommunicate, calling former communications director Anthony Scaramucci to banter about politics and inviting Lewandowski and Bossie to dinner in the residence.
“He’s rotating back to the people who actually like him and is more willing to take advice from those people,” Scaramucci said. “They’re more honest with him, and he’s more comfortable with them.”
Allies said Trump is reverting to the way he led the Trump Organization from his 26th-floor office suite at Trump Tower in Manhattan. There, staffers were functionaries or lawyers, and many of his advisers were outside the company — rival business leaders, media figures and bankers. Back then, Trump controlled his orbit himself from behind his cluttered desk, relying on assistant Rhona Graff to field calls.
.. Ascendant in the West Wing are advisers who play to Trump’s gut: Kudlow on tax cuts and deregulation, Bolton on a muscular approach to foreign affairs, Peter Navarro on protectionist trade policies, Stephen Miller on crackdowns on undocumented immigrants and Kellyanne Conway on an open press strategy and tangling with reporters.
.. Like Conway, Bolton and Kudlow are seasoned cable news commentators who share Trump’s hard-charging instincts and have no illusions about his governing style. Officials said they are expected to cater to the president’s wishes and seek to avoid the internal knife fights that have befallen many a Trump aide.
.. “Gary was really good, but I don’t know if Gary ever embraced the Trump economic ideas. He was more of a traditional Democrat or moderate Republican. Kudlow is a real cheerleader for the tax cuts in a way Gary never was, although he helped get them passed.”
.. Trump has been frustrated by news stories of White House tumult and has ordered aides to contest the notion that there is chaos.
.. “The top story, number one, is Stormy Daniels,” King said he told Trump. “I told him it’s utterly ridiculous. I just came back from Hamburg, Germany, and they were just laughing at us.”
Is It Policy, or Just Reality TV?
It also announced that President Trump was nominating the White House physician to head the Department of Veterans Affairs. What do these announcements have in common?
The answer is that both are indicators of how Trump views his job. He doesn’t seem to see actual policymaking as important; instead, he treats it all as an exercise in reality TV.
.. The point, instead, is that running veterans’ health is a management, not medical, job — and Jackson has no managerial experience.
.. Once you start looking at the Trump administration as an exercise in publicity, not policy, you see signs of it everywhere.
.. Larry Kudlow to replace Gary Cohn in that role, Kudlow’s remarkable track record on the economy — he’s been wrong about everything
.. nothing in Kudlow’s role as a shouting head on cable TV has prepared him for the job he’s supposed to do.
.. So Trump is acting as if his job were to run up ratings for his TV show, not to make actual policies.
.. Wall Street had a big relief rally when investors tentatively concluded that Trump wants to only play at trade war, and can be bought off with symbolic wins that change nothing real.
.. Trump hasn’t managed to repeal Obamacare, but his officials have undermined the program’s efficiency, driving up premiums and reducing coverage.
.. if and when America needs real leadership, there will be nobody home.
.. So far, the Trump era has been almost free from crises Trump didn’t generate himself. One of the few such events demanding an effective response was Hurricane Maria — and the response was disastrously inadequate.
.. So what happens if there’s a foreign policy crisis, a financial crisis, a health crisis
.. we’ll need actual policies. And who’s going to devise those policies? Lincoln had a team of rivals; Trump has assembled a team of poseurs.
.. And even if Trump should come to realize he needs better people, he probably couldn’t get them.
.. Trump can’t even hire good lawyers!
.. one of these days, the reality TV administration is going to bump up against actual reality. And it’s not going to end well.
Trump’s New Economic Adviser Lawrence Kudlow Has Been Wrong About Everything for Decades
Supply-side economics is not merely a generalized preference for small government with low taxes, but a commitment to the cause of low taxes, particularly for high earners, that borders on theological.
.. The Republican stance on taxes, like its position on climate change (fake) and national health insurance (against it), is unique among right-of-center parties in the industrialized world.
.. In 2012, every Republican presidential candidate, including moderate Jon Huntsman, indicated they would oppose accepting even a dollar of higher taxes in return for $10 dollars of spending cuts.
.. Kudlow attributes every positive economic indicator to lower taxes, and every piece of negative news to higher taxes.
.. In 1993, when Bill Clinton proposed an increase in the top tax rate from 31 percent to 39.6 percent, Kudlow wrote, “There is no question that President Clinton’s across-the-board tax increases … will throw a wet blanket over the recovery and depress the economy’s long-run potential to grow.”
.. This was wrong. Instead, a boom ensued. Rather than question his analysis, Kudlow switched to crediting the results to the great tax-cutter, Ronald Reagan. “The politician most responsible for laying the groundwork for this prosperous era is not Bill Clinton, but Ronald Reagan,” he argued in February, 2000.
.. By the time George W. Bush took office, Kudlow was plumping for his tax-cut plan. Kudlow not only endorsed Bush’s argument that the budget surplus he inherited from Clinton — the one Kudlow and his allies had insisted in 1993 could never happen, because the tax hikes would strangle the economy — would turn out to be even larger than forecast.
.. Kudlow then began to relentlessly tout Bush’s economic program. “The shock therapy of decisive war will elevate the stock market by a couple-thousand points,” he predicted in 2002. That was wrong. He began to insist that the housing bubble that was forming was a hallucination imagined by Bush’s liberal critics who refused to appreciate the magic of the Bush boom. He made this case over and over (“There’s no recession coming. The pessimistas were wrong. It’s not going to happen. At a bare minimum, we are looking at Goldilocks 2.0. (And that’s a minimum).
.. When Obama took office, Kudlow was detecting an “inflationary bubble.” That was wrong. He warned in 2009 that the administration “is waging war on investors. He’s waging war against businesses. He’s waging war against bondholders. These are very bad things.” That was also wrong, and when the recovery proceeded, by 2011, he credited the Bush tax cuts for the recovery.
.. Kansas, where he advised Republican governor Sam Brownback to implement a sweeping tax-cut plan that would produce faster growth. This was wrong. Alas, Brownback’s program has proven a comprehensive failure, falling short of all its promises and leaving the state in fiscal turmoil.
.. The onset of deficits exceeding a trillion dollars a year in the midst of low unemployment has not prompted any regret, or even a hint of willingness to compromise on the party’s rigid opposition to higher taxes.
This was the Trump agenda even with the relatively moderate Gary Cohn running the National Economic Council. Now that true believer Lawrence Kudlow is taking the helm, the dawn of fiscal sanity in the GOP is receding ever farther into the distant future.