Christine Romer was a brilliant macroeconomist who had done some of the best work on how government 'stimulus' influenced economic recoveries. Her work showed that the only thing that worked well were long term marginal tax rate reductions and counselled against using government spending to 'stimulate'. She got to the White House and despite her research and insights and obvious expertise the Chicago pols ignored her and opted for an enormous stimulus package 60 times larger than the previous record and totally focused on the one thing that Dr. Romer had definitively shown to be ineffective. None the less she manfully (womanfully?) shilled for a program that she knew was a joke, thereby destroying her credibility and I suspect, her chances to make history as a Nobel laureate.
Now we have her replacement, Austain Goolsbee from the University of Chicago, who is an expert in investment and investment incentives. He has a well regarded corpus of work that shows that government manipulation of investment incentives does not work and that the best way to encourage more investment (you guessed it) is broad, accross the board reductions in the marginal taxes on same. Here's Steve Spruell explaining. Of course the Obami have proposals on the table to raise marginal rates and to substitute in their place all sorts of technical, obscure lawyer and accountant friendly 'targeted' wheezes. So once again a brilliant economist has been brought in to shill for a policy that his research has conclusively proven to be insane.
Thus on the rocks of power and pride great careers are cast. It appears that Obama destroys everything he touches. Everything. This administration is turning into a Shakespearean tragedy with Obama as the humpbacked momma's boyfriend in a toga being chased by witches.
E tu Goolsbee?
No comments:
Post a Comment