Left v right or right v wrong?
Tony Blair often says that the debate about the response to the economic crisis is not a matter of left versus right but of right versus wrong. I was talking about this with a clever person who used to work for him, who pointed out that the economists who support a looser fiscal policy to support demand tend to be left-wing, while those who prioritise deficit reduction tend to be on the right politically.
That is obvious, but the reasons for it are not. If the debate about economic policy really were about “what works” in promoting growth and employment while keeping an eye on inflation, which seem to be common objectives, why should fiscal expansionists tend to be Labour supporters with liberal views on, for example, immigration and a positive attitude to the European Union, while the advocates of fiscal responsibility tend to be Conservative supporters, or, at least, politically undeclared with conservative views on Europe. (If there are any well-known economists who support the Liberal Democrats, do let me know.)
I know how little I know about economics. The economists I respect tend to be neo-Keynesians on the left: Gavyn Davies and Jonathan Portes are my main points of reference. Paul Krugman I know less about; he seems to be even more partisan politically. Hamish McRae, my colleague on The Independent, is more of a budget-balancer, and I don’t know what his politics are, but he has long been a sceptic about the euro.
What is that all about?
Update: Larry Summers is another one.
Photo: Stefan Rousseau/PA. George Osborne (left) and Ed Balls (right)Tagged in: economics
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