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Neocons:Munich :: Austerians:Stagflation


Matt O’Brien is correct:

I checked, and re-checked, and triple-checked, and I can confirm that it’s not 1979 anymore.

Now, that shouldn’t be too surprising — I’m not writing this on an Apple II, after all — but it is to a generation of men (and yes, they are all men) who think stagflation is always and everywhere a looming phenomenon. No matter how low inflation goes, they see portents of Weimar. But that neverending 70s show isn’t just a phobia of rising prices. It’s the idea that the solution to economic pain is more pain. In other words, Volcker-worship.

Indeed, Kinsley was actually explicit about it:

But only in this sense. Austerians believe, sincerely, that their path is the quicker one to prosperity in the longer run. This doesn’t mean that they have forgotten the lessons of Keynes and the Great Depression. It means that they remember the lessons of Paul Volcker and the Great Stagflation of the late 1970s. “Stimulus” is strong medicine—an addictive drug—and you don’t give the patient more than you absolutely have to.

You might think the fact that inflation remains very low might give Kinsley pause, but apparently not. You might also think the fact that the invocation of the 70s makes no sense even on its own terms might also undermine the argument. Except, again, that logic and history don’t really have anything to do with it — it’s an excuse, like pretending to believe that Saddam Hussein was a threat comparable to Hitler to advocate a war you’ve wanted for other reasons anyway. It’s just overclass moral panic, identical to Kinsley’s silly arguments about Chris Christie. Other people have to suffer to pay for some perceived sins; that’s the whole argument. And you can bet that if it was Kinsley being asked to make sacrifices he’d start recognizing the errors in his own arguments very quickly.   The drug analogy is perfect, although not in the way Kinsley intends; a similar logic is used to justify a war on drugs whose immense costs and gross inequities can’t be rationally defended, but persist in large measure because there are sinners and someone has to pay.   As the manager said in Wall Street, “it ain’t going to be me.”

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