Paul Krugman's Latest Idiotic Column

The BBQ Pit
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Paul Krugman has a new hit piece out on Obama, here . Like most of them, it is full of mistakes and false equivalences. He opens talking about Obama’s Fox News interview in which he was asked to name a good conservative idea. Obama named cap-and-trade—a method of dealing with pollutants which uses market forces to efficiently minimize them.

Krugman says,

States have always been free to meet national air-quality standards in any way they see fit. Under the Clean Air Act, states submit their plan to the EPA, which approves or denies it. The EPA almost never denies them, and as a matter of law, cannot mandate the method used to obtain emission reductions. And, of course, the Carter EPA’s approval of such programs hardly bears on where the idea for cap-and-trade comes from.

The real implementation of cap-and-trade came from the 1990 amendments to the Clean Air Act and the first Bush administration, which Krugman acknowledges. Among the architects of that revolution was one of my advisors. I assure you that it was a conservative revolution, fighting the traditional environmental movement which saw trading pollution as sanctioning (in the good sense) immoral pollution practices. That this marked a change from Reagan’s policy is, also, irrelevant to whether conservatives should be able to claim credit for the policy. They absolutely should. It started as a conservative idea and was implemented by a Republican President. By this logic, any policy change Bush made from Reagan is not a conservative policy. We have a word for that kind of logic: stupid.

Krugman then spends several paragraphs hand-waving before concluding that:

So, Obama’s accurate acknowledgement of the conservative idea of market-based pollution solutions means he cannot criticize McCain on health care? WTF? Does anyone see the connection here? Because conservatives once denied acid rain, and Obama credited them with cap-and-trade, Obama therefore cannot criticize them for denying the health care crisis? Sheer sophistry.

Krugman closes by saying:

This final part takes the cake. Hillary is actively supporting a policy which everyone but her campaign agrees is blatant political pandering. Krugman has to acknowledge it because every other editorial economist has criticized her for it. So he sticks in the end, couched in his now familiar attack on Obama’s health care plan. And then equates it to praising the idea of cap-and-trade. Truly shameful.

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Krugman is an educated evil genius. Never forget that he was a shill for Enron.

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Algher, please. Krugman is no genius, and he’s probably not evil. He may have been a shill for Enron or not (I don’t know), but he’s pretty leftist generally.

Al of that is irrelevant. Krugman is fundamentally not an honest man, at least in his columns. I used to look in on them periodically, but I grew disgusted with his fast-and-very-loose approach to facts. He’s often willing to make up facts whole cloth so long as they fit his preferences, and he’s been using that against conservatives for years. He’s a more polite, but no less a hatchet man than Ann Coulter (well, hatchet woman in her case).

I’m not a fan of Ann Coulter, as while I agree with some of her goals in the abstract she’s all-too-willing to impute evil to her opponents. And she’s very rude often dishonest and I don’t admite that.

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Yeah, Krugman has really done his part to make health care “exhibit A for a Democratic campaign” by repeating bogus claims about an Ohio woman supposedly denied care (“misstatements” originally made by Hillary Clinton).

And remember that Krugman was enthusiastically touting Veterans Administration health care as a model for the nation awhile back. This was before the meme of marvelous government health care for veterans lost a bit of luster in the Walter Reed debacle (and additional tales of V.A. hospital screwups hit the news).

Krugman will probably go ballistic in the event of an Obama presidency if compromises are sought with Republicans.

He’s a rabid partisan, and all too often not a very knowledgeable and convincing one.

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I’ll never forget that debate he had with O’Reilly.

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Well, it was a “debate”, I guess, sorta. Much the same way that taking candy from a baby is a “negotiation”.

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Talking about “bogus claims”, you might want to be more careful yourself. Walter Reed is not a VA hospital, it’s an Army hospital, as Krugman himself points out.

And like Krugman, I’ve seen no data to contradict the previous findings that the VA hospitals do a better job, on the whole, than most other hospitals (though I admit, I haven’t been looking very hard - health care policy ain’t exactly my cup of tea).

While Krugman has, indeed, been a real asshole during this presidential primary, let’s not descend into factual inaccuracies ourselves when we try to nail him for errors.

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And you might want to read my post a little more carefully, as the quote you reference notes “This was before the meme of marvelous government health care for veterans lost a bit of luster in the Walter Reed debacle (and additional tales of V.A. hospital screwups hit the news).”

“Marvelous government health care for veterans” is the unifying theme here.

I’ve done med school and post-graduate training at several different V.A. hospitals, and I would nominate none of them as models for health care.

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He sure does.

Cite? The Environmental Defense Fund (now with a different name) and Resources for the Future were all for it.

LOL. It seems to me that Reagan’s conservatism was a big part of the reason why he opposed such regulation. Let’s not forget that Reagan gave us the S&L crisis, by lifting the oh-so-dreadful regulatory burdens on banks protected under the FSLIC’s generous umbrella.

Oh, really. Is Weitzman of MIT (who penned Prices v. Quantities) a movement conservative? John Dales?

Oh and here’s what the modern conservative organ, the National Review, thought about the 1990 Clean Air Act: “…will require expensive retrofitting of equipment of even quite small companies, in order to meet draconian pollution targets… Yet the Bush Administration has looked with a mild and friendly eye…”

There was no mention of tradeable emission targets, because conservatives were oblivious to such technicalities.

Let’s see some linked substantiation, Mr. Parker. Otherwise, we may conclude that you are misrepresenting history and empowering ignorance.

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See here, this “clean air” and “clean water” is all very well, so long as it doesn’t interfere with business! Prioirities, man, priorities!

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Let’s take a closer look at this alleged conservative revolution.

Who voted for the Clean Air Act? 401 representatives.

Who voted against it? 25: 20 Republicans and 5 Democrats.

That’s right: more Republicans voted against it than Democrats. Four times more.

And were these 5 Democrats especially liberal? Well, I only looked up the first 2, but based on them, I’d say, “Not really”.

Douglas Applegate (D) of Ohio was a union-backed rep, who had a 44% approval rating by the League of Conservation Voters in 1993 and a not-overwhelming 70% approval rating from the ADA, the liberal group.

Jerry Costello (D) of Illinois had a 44% rating from the American Conservative Union.

My source is the Fall 1993 edition of the “US Government Owner’s Manual”, from Project Vote Smart. Feel free to research the others.

Sorry, but the Clean Air Act of 1990 received pretty strong support from the environmental community: unsurprisingly, opposition came from the conservative end of the spectrum.

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First I’ll address some of your points before reinforcing my own.

Regarding Reagan, must all conservative ideas be accepted by all conservatives? Marketable permits are favored by conservatives like McCain precisely because they allow flexibility instead of forcing firms to adopt particular technologies. Reagan’s preferences likely went like this: no regulation > cap and trade > command and control. That no regulation was his first preference says nothing about whether the second is a conservative idea or not.

Similarly, the breakdown in support for Congress for the entire CAA revision, which contained many more provisions than just the addition of cap-and-trade for SO2, is meaningless on the question of the origin of the idea. Indeed, you cite the National Review’s opinion of the CAA. That actually works directly against your own evidence, because it suggests that conservatives had other reasons for opposing the amended act.

Next, you point out that EDF was for it. That EDF was for it is actually an understatement. EDF was critical in the passage of the 1990 amendments. But this is actually a point in my favor. Fred Krupp, President of the EDF since 1986, was a colleague and classmate of Richard B. Stewart, who was the Assistant Attorney General for the environment from 1989-1991. Stewart is a conservative (he’s my professor) and a well-known environmental law scholar who–with Krupp–played a large role in shaping the 1990 Clean Air Act. Together with Bruce Ackerman, Stewart wrote* Reforming Environmental Law*, 37 Stanford Law Review 1333, in 1985. It was among the first major law articles to argue for the benefits of marketable permits over the existing Best-Available-Technology approach. It had a huge impact in the environmental law community and is part of what convinced Krupp to advocate the policy.

Krupp was widely criticized at the time by liberal environmentalists for selling out to big business. Check out the final page of this article for the residual feelings about EDF. “The Nation: For the Environment, Compassion Fatigue ,” by Keith Schneider, The New York Times, November 6, 1994. He eventually served on George H. W. Bush’s Commission on the Environment. Even today EDF is widely criticized for being too conservative. “Climate Shift: Some Environmental Groups are Sitting Down With Big Business. But others say the fate of the planet is non-negotiable ,” by Daniels Brook, The Boston Globe, March 18, 2007.

The best source for tracing the history of marketable permits is Barry D. Solomon & Hugh S. Gorman, The Origins, Practice, and Limits of Emissions Trading, Journal of Policy History (2002). I can’t find it in a free database, but I’ll summarize. If you have access, I encourage you to read it yourself.

Referring to the trading that happened pre-1990, the authors say, “Many national environmental groups, most notably the Natural Resources Defense Council (NRDC), opposed these early applications of air emissions trading.” NRDC isn’t even the most liberal of environmental groups. They point out how Sierra Club and others continue to question cap-and-trade policy.

The authors point out that the foundation of the idea is in Coase Theorem. Since you are an economist, I’m sure you know that Coase, and the U. Chicago economists generally, are regarded as conservative. They trace the rest of the history through Dales (whom you cite and whose politics I know nothing about) and others. They note especially the important role President Bush played in getting the provisions into the amendments.

Like all big ideas, I’m sure this one had liberal supporters in the early stages as well. But I think it is entirely fair to term is a conservative idea. It is a way of minimizing command-and-control regulation, which is the type Reagan railed against. Many liberal groups criticized, and continue to criticize it for being too friendly to big business and sanctioning pollution.

I have a half dozen other relevant books and articles if you’re interested in reading more. PM me if you like.

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But, in a way, aren’t you suggesting that this notion was concieved less for the cause of environmental protection, but as a means to short-circuit or stall regulatory initiatives that businessmen would find uncomfortable? Seems to me there is a movement afoot to credit consevatives with an environmental conciousness and concern they have never had.

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Generally speaking, it is true that cap-and-trade is better for businesses than command-and-control, but it is also better for the environment. I don’t think it impugns their environmental consciousness to want a program that is as efficient as possible.

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A slight correction to my previous post. Stewart and Krupp were not classmates, just colleagues in the emerging world of environmental law scholarship.

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Certainly not, if that is truly their motivation. Is that the case you would like to make?

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I’m not sure I understand the question. Motivation is difficult to assess externally, but from their written arguments, I think it is quite clear that both the politicians and the intellectual standard-bearers were interested in a system that was more efficient, and with fewer perverse incentives, than the dominant paradigm of best-available-technology.

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I strongly take issue with your characterization Richard Parker, but I confess that it is reassuring that we are working off of the same set of facts.

Do you really think that the Environmental Defense Fund was a conservative organization? I find that ludicrous.

Here’s my potted history.

The Clean Air and Water Acts were passed under Nixon, around 1972. They use Command-control techniques, which caused some consternation among American economists -left, right and center- as they typically are not too fond of central planning. One popular alternative within the discipline was to tax pollution. Another was tradable emission permits, which had the advantage of actually being politically viable – big business was unlikely to agree to a tax scheme.

The environmental community didn’t know what to make of these arguments, though they eventually came around. EPA policies were shown to be demonstrably inefficient, and where there’s vast inefficiency there are opportunities to please everyone, by increasing output, profits and pollution reduction. Or so the economists argued.

This was in no way a “conservative revolution”. This was the application of textbook economic principles to the problem of environmental protection. The shortcomings of command-control had been detailed by quite a few researchers.

Yes, the EDF was known as the most market-friendly of the environmental pressure groups. But so what? Movement conservatives such as the National Review were unalterably opposed to any sort of environmental innovation. I’m happy that Stewart considers himself a conservative, but I’m afraid you’re going to need the example of more than 1 advocate.

And I repeat, these tradeable permits were not even mentioned by the National Review. This issue was simply not on their radar, suggesting that this was a technocratic idea, not a conservative one.

Right, but try “unprofitable”. Again though, more efficient regulations (i.e. lower costs for industry for the same or greater amount of emission reduction) is generally a good thing all around. When incumbent firms are granted tradeable emission permits, they are essentially being granted assets, that can be cashed at a profit if they find a cheap way to reduce emissions.

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Here’s an obligatory link to The Master’s 1993 report, “Can companies buy “pollution futures” that give them the right to pollute?”, where he explains the logic behind the idea.

That sort of wording suggests that the EDF was considered a bona fide environmental organization.

That they might have been perhaps were a little too close to industry was the stuff of inside-baseball. Nobody too my knowledge has ever accused them of being an astroturf operation.

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In my experience in this field (which is admittedly limited to a three month environmental law internship), it is the most conservative of the major environmental NGOs. I don’t think they are astro-turf. They are genuinely committed to bettering the environment through cooperation with large corporations and using market incentives. I’m not sure where exactly the centerline that they must cross over to be considered conservative is, but I definitely don’t think their support for the policy is an argument for its liberal origin.

And again, I would note the criticism that EDF received from the left for supporting these kinds of policies.

My only major quarrel with your history is that many environmental groups were actively opposed to marketable permits. As previously cited, NRDC was opposed and now isn’t, but Sierra Club and others continue their opposition. The mainstream liberal environmental movement is very skeptical of big business. Many environmentalists see pollution as a sort of moral wrong. Some of the most forceful advocates of the left’s environmental movement have criticized marketable permits as institutionalizing pollution, making it less sinful. See, e.g., Mark Sagoff, The Economy of the Earth: Philosophy, Law, and the Environment (1988).

I agree that it is the application of textbook economic principles. But sometimes conservatives are the standard-bearers for classical economics. Do we agree that we can call Ronald Coase a conservative? If not, perhaps our disagreement lies in our political definitions rather than in the history of marketable permits.

Well, of course, George H.W. Bush was another prominent advocate. :stuck_out_tongue:

I don’t see why the National Review’s opinion is either here nor there. You concede that they opposed the amendments because of various command-and-control reasons and that they did not mention marketable permits (which in the grand scheme was a fairly small part of the 1990 amendments). If National Review had come out against marketable permits, I think that would be a strong but not decisive argument for you. But they didn’t do that.

I just don’t think it not being on the radar of one of the conservative mouthpieces is evidence that it isn’t a conservative idea. I think it just wasn’t a big part of the reform.

Perhaps from your perspective, the critiques of command-and-control regulation are politically neutral. And in terms of the content of the critiques, I think that’s correct; they can be made without any political value judgments. But in terms of which political party has championed the anti-C&C agenda, I think it clearly has been conservatives. Sometimes for the worse, and sometimes for the better, as in this case.

Let me just close by noting that my critique of Krugman’s article was not limited to this issue. Even if I thought Krugman was right that marketable permits were not championed by conservatives, the rest of his article is hackwork.