Paul Krugman’s 91% Solution

You have to admit it’s refreshing when a genuine, died-in-the-wool Washington insider lets his hair down after an election and tells us what he really believes.

Such is the case with Paul Krugman, NY Times columnist and godfather of Keynesian, read leftist, economics (he is also a Nobel Laureate, which proves nothing more than the ideological leanings of the committee determining such honors).

With his main man Barack now safely ensconced in the White House for four more years, Krugman makes a startling (even for the left) admission in his recent op-ed.

He pines for the good old days of the 1950’s.  Well, not so much for the Ozzie and Harriet part, or the cold war, or Joe McCarthy.  But for the 91%, yes you read that correctly, 91% tax rate for the evil rich.

One keeps expecting him to stipulate that he’s using hyperbole to make a point.  But he never does, concluding his column with “we can do it again.”

He actually believes a return of the 91% tax rate would be good for America.  Good for a country that is still in the throes of a stagnant economy, high unemployment, increasing government dependency and frightening levels of debt.

This is much like the issue of health care in this sense: while taking great pains to sell the Rube Goldberg contraption known as Obamacare based on the continuation of the nation’s insurance-based structure, the promise that you can keep your current plan and other soothing rhetoric, Barack Obama, Harry Reid and Nancy Pelosi in their hearts (and in their words, if you dig down far enough) desire a full European-style, government-run, single payer solution.  They just know they could never really admit it.  Or get it passed.

But Krugman has now blown the cover of leftists who say they want only a small tax increase on the wealthiest Americans, the top one or two percent who are easy to demonize.  Who really believes they want to stop there?

This begs the ultimate questions voters should have asked about Obama, Romney and all other candidates for public office for that matter.  What would they do if they could get away with it?

It was with the hope that enough voters would ask that question that so many observers, myself included, believed that Mitt Romney would prevail and the GOP would at least gain seats, if not seize control, in the Senate.

Instead, of course, Romney lost by three percent, George Allen went down by six percent, and a surprising number of other Republican Senate candidates were also beaten.

Mr. Krugman, who actually criticized the Obama administration (well before the election cycle) for not spending enough, especially on the failed billion dollar stimulus, has long favored an even larger welfare state.  So the questions for this brilliant economist is: with a 91% tax rate on the goose that lays the golden egg, i.e. the job creators, that will unquestionably lead to dramatically less production and more money moving offshore, where exactly does he intend to find the makers who create the piggybank for the takers (the 47%, if you will)?

And please don’t answer by saying that the increased tax revenues from the super-wealthy will cover a multitude of budgetary sins, for we know full well that even a 100% tax rate on the evil rich (which, by the way, includes Krugman himself) will hardly make a dent in our debt crisis…even if you somehow buy the laughably and fatally flawed argument that such a high rate will have no impact on private economic activity.

Krugman doesn’t stop his true confessions at pining for the days of government confiscation of most all of the income of the wealthy (though there were many deductions available to the “1%” that are no longer on the table).  Oh so predictably, he attacks the “mansions, army of servants and yachts” of the “plutocrats” (he actually uses that word instead of just implying it as Obama did about Romney during the campaign).  One wonders how modest his own lifestyle is (paging Al Gore).  Americans seem to tolerate even liars and scoundrels if they’re talented, but they detest hypocrites.

And then, he essentially lumps all opponents of his point of view together as “pining for the days when minorities and women knew their place, gays stayed firmly in the closet and congressmen asked, “Are you now or have you ever been?”  So those of us who actually believe, as the founders did, in the power of the individual rather than the government, in sustainable rather than unsustainable levels of government spending, and in incentives for productive and fulfilling lives rather than dependency, are racist, sexist, homophobic McCarthyites.

One might ordinarily laugh off such a tragically misguided and discredited viewpoint, expecting it to come from an outright, professed, unreconstructed communist.  But this is a guy who is actually venerated (I’ll stop just short of worshipped) by the secular left that now represents the ruling class in America.  We should all bookmark this column and wave it as a bloody shirt in future elections.

After all, with enemies like this, who needs friends.

  • Larry Moore

    I do not see Mr. Tim Donner’s piece; “Paul Krugman’s 91% Solution” in response
    to Mr. Krugman’s “The Twinkie Manifesto’’ as fair to Mr. Krugman.

    Mr. Krugman’s “Manifesto”
    offers a generalized comparison between the 1950’s and today. In his comparison Krugman makes the point
    that from the early 50’s through the early 70’s the people of the United States
    experienced uncommon growth in their standard of living. And that this growth came with and during
    very high tax rates for the rich in comparison to today’s rates.

    Nowhere does Mr. Krugman state that “He
    actually believes a return of the 91% tax rate would be good for America”. The words in quotations are Mr. Donner’s alone. It seems Mr.Krugman supports a tax increase
    for the rich in line with the 39% (pre-Bush tax cuts) top rate the Democrats
    are seeking.

    Mr. Donner says that
    leftists demonize the rich while claiming to “want only a small tax increase”. I agree some are entertained by publicly demeaning
    the rich and in the process cause needless friction. The rich are not evil. They simply do what they can, mostly shoehorned
    into what is legal, to amass as much wealth as possible. This should come as no surprise to anyone.

    More often than not,
    the very wealthy do not create their wealth instead they utilize the labor of the
    lower and middle classes as well as our financial system to obtain wealth. What is legal is that which the vast majority
    who create wealth must address to insure a backdrop of fairness.

    Great value and
    simplicity attend fairness, it is an idea easily understood and utilized by
    those previously uncommitted and embracing reason. A start at fairness while harboring preconceptions
    and commitment to a preordained conclusion will not get you there. Instead you will arrive at only one place,
    that being where you wanted to go from the start of the thing.

    Mr. Donner doubts the intentions of those who
    ask for “only a small tax increase on the wealthiest Americans” as he asks us “Who
    really believes they want to stop there?” Let Mr. Donner spin that wheel, his question
    leads only to the inexhaustible pursuit of the unknowable “real” intentions of
    others if we refuse to accept their own explanations. I’m sure Mr. Donner is willing to respond to
    his own dark question with a darker still answer. Mr. Donner would leave us all in fear of
    boarding the train not knowing how fast or far it will take us. Mr. Donner would have us forget that we own
    the train, the tracks, the ground they rest on and we have in our hire the crew
    that man the train. It’s in our ability
    to stop when and where we wish. If we don’t
    get on the train out of fear pushed upon us, then none of us goes
    anywhere. Mr. Donner points us not at
    our common problems, but each other.

  • DJRippert

    Krugman’s problem is that he just can’t help himself. He takes a fairly simple point – namely, that high marginal tax rates in the 1950s did not compress growth. If he would have spent the rest of his column developing that idea he would have been fine. However, he just can’t prevent himself from jigging and jagging into various other liberal directions. Collective bargaining is a case in point. He drags unions into the matter as if raising the highest tax rates will magically restart unionism.

    It also seems like he never bothered to read the “How Executives Live” article he references (via link) in his column. If he had read the article he would have seen that the corporate executives of the 1950s lived very high on the hog.

    He also conveniently forgets history. It was liberal icon John Kennedy who slashed the high taxes. In fact, Kennedy presided over the largest tax cut (measured as a percentage of GDP) in American history. Guess what? The world didn’t end with the Kennedy tax cuts. Krugman’s own calculus has American prosperity continuing until 1973 – long after the 91% tax rates were a thing of the past.

    The man is intellectually dishonest and an embarrassment to professional economists.

  • This field is for validation purposes and should be left unchanged.