Yesterday, under the title Ducks In a Barrel, we noted that Paul Krugman’s latest column had been decisively fisked by Donald Luskin. Unfortunately, the people who run the Minneapolis Star Tribune don’t read Luskin, so yesterday they ran Krugman’s column, which the Strib’s editorial board endorsed, adding a whopper or two of their own. Somewhat weirdly, the basic theme of the Krugman piece and the Strib editorial was that President Reagan was not a tax-cutter. Today I sent the following email to the Strib’s commentary editor, Eric Ringham:
Eric, I can’t believe you are still running columns by Paul Krugman. Don’t you know he is the least reliable columnist now writing? For his Reagan column, he pulled off his usual deception, quoting figures on “middle income families with children” because the statistics on all middle income families didn’t work for him. He compounded this deception with an outright lie, misrepresenting 1979 tax burden data as 1980 data. This kind of falsehood is typical of Krugman. You can never trust any statistic he sets forth in a column.
The relevant tax burden data are here.
They show that in 1981, the last year before Reagan’s tax cut package took effect, the “total effective federal tax rate” on middle-income families was 19.2%. In 1988, Reagan’s last year in office, the total effective federal tax rate on middle-income families was 17.9%–a decline of 1.3%. These data are from the source that Krugman misrepresents, the CBO. Eric, anyone willing to do five minutes worth of research can see that Krugman is, once again, making stuff up. Krugman is, in my opinion, unique among columnists in that he consistently sets out not to inform his readers, but to deceive them.
He misrepresents the Social Security Reform Act of 1983, too, saying that “Its key provision was an increase in the payroll tax that pays for Social Security and Medicare hospital insurance.” In fact, the 1983 act merely accelerated by one year tax increases that had been adopted in 1977. (This is why, if you look at 1987 data instead of 1988, you will see that the total federal tax burden on middle-income taxpayers was 17.6%.)
For a more complete deconstruction of Krugman’s latest column, go here.
The Strib’s editorial board added an additional level of misrepresentation in yesterday’s editorial; they wrote: “During Reagan’s eight years in office, federal spending averaged 22.4 percent of Gross Domestic Product, which was higher than in any year under Presidents Richard Nixon, Gerald Ford and Jimmy Carter.” A very cleverly-worded piece of deception. In fact, federal spending as a percentage of GDP skyrocketed to unprecedented levels during the Carter administration and peaked at around 25% early in the Reagan administration. Federal spending as a percentage of GDP then declined to around 22.5 at the end of Reagan’s second term. (This was due more to rapid GDP growth than to fiscal discipline, given the Democrats’ effective control over Congress.) You can see the data here.
Eric, I’ve always thought you were a pretty fair-minded guy, albeit a Democrat. But you are really doing your readers a disservice by publishing these kinds of misrepresentations.
I have copied Paul Krugman on this email, so if he has anything to say for himself, I am sure he will respond.
Krugman continues his attack on the Reagan presidency in today’s column. I haven’t time for a complete disassembly at the moment, but consider this howler:
Inflation did come down sharply on Mr. Reagan’s watch: it was running at 12 percent when he took office, but was only 4.5 percent when he left. But this victory came at a heavy price. For much of the Reagan era, the economy suffered from very high unemployment. Despite the rapid growth of 1983 and 1984, over the whole of the Reagan administration the unemployment rate averaged a very uncomfortable 7.5 percent.
In other words, it all played out just as “left-wing Keynesian economics” predicted.
This is so brazen that you have to wonder whether Krugman is really trying to fool people anymore, or just going through the motions. As anyone over 35 years old presumably remembers, the decline in unemployment was, along with victory over inflation and the rapid expansion of gross domestic product, one of the signal achievements of Reagan’s domestic policy.
When Reagan took office in 1981, the unemployment rate stood at 7.4% and rising. During the recession of 1982-83, unemployment peaked at almost 10%. But as the Reagan tax cuts began to be felt, and the economy started to take off, the unemployment rate dropped sharply and steadily. By the time Reagan left office, it was down to around 5.5%, and still dropping. This bar chart shows in graphic form the magnitude of Reagan’s achievement:
One can only wonder what audience Krugman thinks he is writing for. People with no memory of the past and no ability to do research, I guess.