Left v right and right v wrong: part IV
Further to my previous posts about why left-wing people tend to support fiscal stimulus and right-wingers to support budget-balancing, Paul Krugman (pictured) has devoted his column in the New York Times to the subject. Here’s the important part:
Real-world events — stagnation in Ireland, the original poster child* for austerity, falling interest rates in the United States, which was supposed to be facing an imminent fiscal crisis — quickly made nonsense of austerian predictions.
Yet austerity maintained and even strengthened its grip on elite opinion. Why?
Part of the answer surely lies in the widespread desire to see economics as a morality play, to make it a tale of excess and its consequences. We lived beyond our means, the story goes, and now we’re paying the inevitable price. Economists can explain ad nauseam that this is wrong, that the reason we have mass unemployment isn’t that we spent too much in the past but that we’re spending too little now, and that this problem can and should be solved. No matter; many people have a visceral sense that we sinned and must seek redemption through suffering — and neither economic argument nor the observation that the people now suffering aren’t at all the same people who sinned during the bubble years makes much of a dent.
There is something in that, as Martin Hutchison explained in his response to my original post. Krugman then goes on to make a tub-thumping but self-undermining argument about class, suggesting that the rich believe in austerity because they think it is in their interest, even though it isn’t. But I’m just as sceptical about the idea of false consciousness when applied to the rich as I am when it is applied to the workers.
Hat tip: Stanley Raffel.
Photograph: Fred R. Conrad/The New York Times
*It’s on the Banned List but he is a Nobel prize-winning professor.Tagged in: economics
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