I Think Clive Crook Is Right and Wrong...

Clive Crook comes to Paul Krugman's defense, apropos of Paul Krugman's rebuttal of Ruth Marcus's shameful Washington Post op-ed column:

Clive Crook: Krugman and Krugman and Social Security: I think Paul's rebuttal is correct, so far as the "circumstances" [i.e., the economics of Social Security] are concerned...

I think so too.

He then moves on to other issues, where I think Clive Crook goes astray. I think that Clive Crook stays on the right track here:

...But the circumstances [i.e., the economics of Social Security] are of course not the only thing to have changed since he opined on this topic in the past. [Paul Krugman's] modes of analysis and expression have changed too, and radically, in ways that often seem calculated to obscure the fact that he is one of the four or five most brilliant economists of his generation. This is not incompetence or inadvertence on his part; it appears to be a conscientious choice...

But then he goes badly astray. This is simply wrong:

...[Paul Krugman] wants to fuel the rage of the administration's opponents more than he wants to help people think through the arguments. He feels that this now serves the greater good. Bush and his people are too wicked for dispassionate analysis, he believes; there will be time for Seriousness later...

Here Clive Crook is 180 degrees wrong. "Dispassionate analysis" begins with the observation that Bush lies, those on Bush's payroll lie, and Bush's other mouthpieces lie. By beginning his analyses with the presumption that Bush and company (including people like Ruth Marcus) are informed public-spirited people making serious arguments in good faith, Clive Crook is misinforming his readers. Indeed, by paragraph 11 of this very post Clive Crook is writing that "the Bush administration’s focus on social security reform was... deliberately misleading"--a conclusion that belongs much higher up in the article.

Here, however, Clive Crook is right:

...In my view, for what little it may be worth, this is a disservice to Paul's own remarkable talents...

In an ideal counterfactual world, Paul could indeed be using his remarkable talents more productively. But we do not live in the Republic of Plato, we live in the Sewer of Romulus. So here and now Clive is wrong when he writes:

...this is a disservice... as well as to the greater good...

If somebody else were holding down the reality-based slot on the New York Times op-ed page, that would be one thing. But nobody is--hence I don't see that Paul as a moral agent has a choice: he has to keep doing what he is doing.

And here Clive is right:

...But this is a complaint which, by now, he has heard a thousand times...

There follow some smart observations about Social Security, like:

On an important point, [Democrats] are right: no great fiscal crisis lies in wait for social security. On present policies, the retirement of the baby boomers is going to push the programme into a gently increasing deficit over the next few decades, but tweaks will be enough to deal with it.... A fiscal crisis is indeed looming over the next few decades – but its cause is Medicare, not social security. For the US, the real fiscal enemy is not the ageing of the population, but the relentless rise in healthcare costs.... [T]he Bush administration’s focus on social security reform was both ill-conceived and, no doubt, deliberately misleading....

And:

The case for [Social Security reform] has little to do with fiscal arithmetic.... Private saving in the US is roughly zero.... households have... relied on house-price inflation to provide capital to support them in retirement. Those bets are going bad at the moment. Many Americans, especially the least well off, are going to be much more tightly squeezed after they retire than they expect. Social security gives them a base that should not be jeopardised – but for many of the not-rich, with few other resources to draw down, it is not enough.

Politicians should be asking themselves how best to encourage more saving – and Democrats should co-opt “the ownership society” as a slogan of their own. So simple: just rebrand it “ownership for all”.

A big theme of Democratic thinking is the need to spread the benefits of capitalism more broadly. Middle-class anxiety is real. Support for liberal trade is collapsing. The answer, Democrats say, is shared prosperity: the rewards of globalisation should go not just to the shareholder class, but to workers too. Quite right. But does this spreading have to be mediated exclusively through higher taxes and higher spending on welfare programmes? Is there not a good liberal case for widening the shareholder class as well?

For genuine social security reformers, that is the real prize. Shore up the system for the least well-off, to be sure, and make the safety net more secure. Then add a new layer, through partial privatisation, of wider participation in equity ownership...

And one not-so-smart observation about Social Security:

Properly conceived, this is a programme for empowering the less well-off, supporting their financial independence and widening access to the benefits of capitalism. No doubt, Republicans have a self-interested tactical reason to support the idea: more shareholders might nudge the electorate their way. But is the Democrats’ equal and opposite reason for denouncing the idea any more noble or public-spirited?

I think Clive Crook has forgotten his recent history. Bush's Social Security "reform" plan was emphatically not "shore up the system for the least well-off" and "add a new layer... of wider participation in equity ownership." Remember Gene Sperling's slogan: "personal accounts as an add-on, not a carve-out"? That was a Democratic program (originally Ned Gramlich's)--not Bush's. It would be a good program. But it is not a program that you can get to if you start rom the idea--as Ruth Marcus and company do--that Social Security faces an imminent crisis.

Comments

[wood turtle]

The qualifying age is going up to 67, and there is no guarantee that people's life expectancy is going to go up. What's to worry?

[Charles]

Clive's problem is that he thinks he's a mindreader. On the prostate cancer statistics issue, I've already rapped Clive's knuckles for issuing statements on Krugman's behalf without dropping him an e-mail to check. "...[Paul Krugman] wants to fuel the rage of the administration's opponents" repeats, with aggravation, this bit of mental turbidity.

To put it simply and elegantly, barring that he's a mentalist, how the f--k does he know what Krugman wants to do?

There are lots of blogs to read and until he can telepathically inform me of why I am wrong about this, Clive's is off my list.

[piotr]

I think Brad got it better than you, Charles: dispasionate analysis of the GOP policies and their effects leads to rage, or at least to outrage. Krugman's moral duty is to be shrill.

And as rabble-rousers go, Krugman is singularly devoid of passionate language. He uses words like "lie" and tries to keep his arguments as simple as accessible as he can. But they are nevertheless arguments with logical steps, references to sources and other studies etc. It is very cerebral kind of shrillness, well appreciated by geeks but probably not by the unwashed masses.

So Krugman repeats "Conservative movement delenda est", because we are a much worse society as long as this movement stays in power or has ability to block reforms that would undo its mischief and restore (and complete) New Deal.

By the way, I think that Crook's problem is that while is head is in the right place, his heart is in the land of delusions. "Ownership society" is a strange priority. I would diagnose Crook as a "fanatical moderate" who thinks that priorities proposed by Krugman centered on (relative) economic equality and shared increase in the standard of living (rather that ditching the bottom 50%, or even 90%, in a mire of stagnation and sliding back) are to crass for a subtle mind.

Except that a true fanatical moderate wants to be serious about fixing non-existing problems with Social Security. So Crook is a genuine moderate rather than a useful idiot for conservatives. In better times, it would be a position to recommend.

I think that Crook raises an excellant question -- why Americans save so little, why is it so hard for them to save -- but "ownership society" is a wrong angle to pursue it.

[Barkley Rosser]

Over on Econospeak in some commments, Bruce Webb reports the latest numbers for this year. As of the end of September, the Social Security Trust Fund had taken in $161 billion net for the year. The low cost projection has it taking in $193.2 billion for the entire year. That means that the fund is doing better than the low cost projection by, oh, $13-14 billion or so.

Now, everyone should keep in mind that under the low cost projection, the fund never runs a deficit, never, much less goes insolvent. And, it is not just this year, but most of the years during the last decade that the fund has done better than this low cost projection, and, of course, much better than the intermediate cost projection that is the general object of discussion in the media.

So, in fact, Clive Crook's "gently increasing deficit" looks way too pessimistic by the most recent numbers, indeed, by any numbers over the last decade pretty much.

[Barbara]

When Clive Crook asks why everyone shouldn't be able to benefit from participating in the ownership society as shareholders, he telegraphs the fact that he doesn't understand that the shareholder class has seriously moved on from the usual view of it -- or more properly, it has fragmented: Not all shareholders are created equal. The public securities market has become a festival for well-connected swine. And certainly, those shareholders who are managers have been helping themselves to outsize shares of the assets that might reasonably have been expected to flow to the rest of us 20 or 30 years ago, as dividends. Not participating at all is the wisest choice, especially if it concerns money you actually need, and it might just deter the looting that we have become accustomed to, if enough people do it for long enough.

[kharris]

Slightly off topic, and clearly an effort to commit the same crime that Crook is here accused of committing --

Any chance that Krugman's affection for Keynes has influenced his choice of secondary vocation? Is "The Economic Consequences of the Peace" the model from which Krugman is working?

[sm]

In the Republic of Plato the rulers are allowed to lie to maintain their power, and fix the results of what is supposed to be a meritocratic system.

We are in the Republic of Plato, at least we will be when the government bans all music except that in the Doric mode.

[beckya57]

The case against Krugman is always about one thing: He insists on telling the unpleasant truths about the Bush (mal)Administration that lots of people (including a lot of elites) don't want to hear. He's been doing it since before Bush became president, and he's stuck with it through lots of condemnation. He's a fine example of the truism that prophets are always loathed in their own time.

[Rob]

Shorter Crook: "Sure Krugman is right but why must he be so shrill?"

[Charles]

Piotr, I don't dispute that dispassionate analysis of GOP policy leads to rage.

What I dispute is Crook's assertion that Paul Krugman's intent is to enrage people about GOP policy. When one describes the motivation of another person, unless it's completely obvious, manners dictate one should inquire.