Krugman on Saving (Oops, Losing) Your Soul

This is from his latest column:

Something terrible has happened to the soul of the Republican Party. We’ve gone beyond bad economic doctrine. We’ve even gone beyond selfishness and special interests. At this point we’re talking about a state of mind that takes positive glee in inflicting further suffering on the already miserable.

And what did Republicans do to cause such moral outrage? The House of Representatives passed a farm subsidy bill without the food stamp program in it. Krugman tells us that:

Farm subsidies became a fraud-ridden program that mainly benefits corporations and wealthy individuals. Meanwhile food stamps became a crucial part of the social safety net.

Mind you, the House didn’t abolish food stamps. Or even cut them back, even though the food stamp program is far more “fraud ridden” than the agricultural subsidy program. But Krugman argues that food stamps as a separate program will command less political support.

Okay, let’s accept that argument for a moment. By similar logic, how much lower on Dante’s rings of hell would we have to put Democrats? The modern farm subsidy program started in 1933 under Franklin Roosevelt and a heavily Democratic Congress. And except for a brief four-year period (1939-1943), for the next four three decades the farm subsidy bill was completely lacking in…(you guessed it)…food stamps!

Plus the old farm subsidy program was far more regressive than its modern counterpart. Its principal method of farm aid was to push agricultural prices up — by paying farmers not to produce and to destroy part of their livestock. Since food is a higher proportion of the budget for lower-income families, the biggest burden of the program fell on those least able to afford it. And, unlike the current program, in those days there was no limit on how much subsidy wealthy farmers could realize. In fact, the farm subsidy program was probably the most regressive program of the entire New Deal!

Why mention this? Because the NYT advertises that Krugman is a Nobel Prize winning economist and implies that when people read his columns they are getting real economics. Much of the time they are reading a rehash of the latest press release from the Democratic National Committee.

I think all economists have an obligation to alert the public about snake oil pretending to be economics.

Comments (12)

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  1. Devon Herrick says:

    I read Krugman’s article and thought it was over-dramatic.

  2. Dudley Do-Right says:

    I’m a big bad of generous farm subsidies to wealthy farmers! After all, the affluent household I grew up in was partially funded by farm subsidies.

    That said, farm subsidies are a total waste of taxpayers money. Big corporations are getting subsidies. Wealthy farmers are getting subsidies. Some farmers have a dozen different farms (on paper) to maximize their subsidies.

    I’ve heard critics say that large farms should be excluded so only small farmers get subsidies. That is also wrong headed. All subsidies should be done away with. Why subsidize a small, poor farmer (or a rich, hobby farmer)? We don’t subsidize small automakers just because they’ve been priced out of the market.

  3. JD says:

    It’s amazing that Nobel Prize winning Economist consistently makes arguments based on ambiguous moral arguments. I don’t think that a “soul” gone bad would be sufficient economic reasoning at Princeton.

    • Tomas says:

      I am not sure any mainstream economists espouse sufficient reasoning to be backed by any serious academic community.

  4. Bubba says:

    Why hasn’t anyone pointed out that Food Stamps are a leading cause of obesity among low-income people. Obesity is a far bigger problem for poor people than hunger. In fact, hunger really isn’t a problem. It’s a symptom of a different problem. Hunger exists in America only because of dementia, child neglect and drug addiction. Suggesting that people actually need food assistance to avoid starvation is completely false. Most adults could feed themselves on $1 per day if they were willing to eat stable foods (mainly carbohydrates) and prepare them. Food Stamps are just another way to transfer income. Most Americans would object to cash payments to poor people. Offering food makes the welfare system more palatable (no pun intended). Food assistance is fungible. If I’m used to spending $300 per month on food, and someone gives me $300 worth of food, I have $300 more disposable income to buy beer, crack or lottery tickets.

    • JD says:

      Exactly. The intention isn’t to feed people, if it were nobody would mind drug testing.

  5. Tomas says:

    I don’t see how food stamps should be part of the farm bill. Completely different type of program in my opinion.

  6. Ken says:

    Snake oil. I like that.