Paul Krugman’s recent posts have been most peculiar. Several have looked uncomfortably like special pleading for political figures he likes, notably Hillary Clinton. He has, in my judgement, stooped rather far down in attacking people well below him in the public relations food chain, violating one of the unwritten rules of discourse: if you are going to kick someone, you kick up or at least sideways.
Perhaps the most egregious and clearest cut case is his refusal to address the substance of a completely legitimate, well-documented article by David Dayen outing Krugman, and to a lesser degree, his fellow traveler Mike Konczal, in abjectly misrepresenting Sanders’ financial reform proposals and attacking that straw man. Dayen pointed out that the proposal that both criticized, Sanders’ plan to break up big banks, was Elizabeth Warren’s so-called 21st Century Glass Steagall bill. That also meant they misrepresented Sanders as not addressing shadow banking and undermined Warren’s reform program. Similarly, as Dayen stressed, both tried to depict Sanders as a naive hair-on-fire idealist for wanting to break up the banks when both the FCIC and foreign bank regulators back the idea.
Now there are elements of Sanders’ reform plan not to like. For instance, while reinstituting a usury ceiling is a stellar idea, the specific way Sanders has formulated it needs rethinking. Similarly, he wants to stop paying interest on bank reserves and instead impose charges on them, which is misguided. The interest payments on reserves are an artifact of QE, since it has resulted in excess reserves piling up in the banking system, and the payment of interest rates becomes necessary to allow the Fed to maintain an interest rate floor. But rather than do their own homework, which would have included reading the Warren bill, these self-styled wonks simply amplified Clinton’s anti-Sanders talking points with a bit of extra hand-waving.
What so irritated Krugman, and led him to issue not one but two posts going after Dayen on a bizarre no-name, no-link basis? It’s doubtful that it was Dayen describing at length how Krugman’s attacks on Warren’s bill (had he even understood that that was what he was attacking) were at odds with his past position, or that Mike Konczal’s recent skepticism of Glass Steagall-type reforms, was a flip-flop from a long document he co-wrote in 2010. This is what appears to have set Krugman on tilt:
The radicals in this debate, in other words, are those protecting the deregulatory status quo….
But denying this consensus, and delegitimizing structural reform as silly and shortsighted, only does the work of banks and their lobbyists, who want to preserve the current system and cut off any avenues for a more far-reaching redesign.
Why in the world are people who call themselves liberals helping them do it? Those wondering why Warren hasn’t endorsed Hillary Clinton yet should consider whether it’s because Clinton and her minions are delivering a mortal wound to the cause of Warren’s life.
Krugman’s first post, Wonks and Minions, went full bore ad hominem. Members of his audience who would not know that Krugman was settling a particular score would mistakenly see this as an effort to depict many of Sanders’ backers as hysterics and unsound, clearly less trustworthy that established fauxgressive brand names like Ezra Klein, Jonathan Cohn, and Jonathan Chait. Treating this list as if it were a pantheon of intellectual accomplishment is a big tell as to where Krugman is coming from. Established readers will recognize Klein as a shallow apologist for neoliberalism; we’ve referred to him as Baghdad Bob (see Ezra Klein Should Stick to Being Wrong About Health Care, New Propaganda Coinage: “To Klein”, and Mark Ames: Ezra Klein’s Shine Job on the Kochs for examples of what Krumgan apparently regards as praiseworthy output). If you think we are being unfair, or that our criticisms are dated, please see this fresh Jacobin article eviscerating Klein’s apparently Sanders-induced volte face on his health care views in Meet the New Harry and Louise.
And here’s the priceless part in Krugman’s faux high ground post: he acts as if he’s riding in to defend Konczal when Dayen’s article was almost entirely about Krugman. And Krugman’s failure to offer a substantive response means he’s resorting to old trick of trial lawyers at the end of their rope: “When the facts are on your side, pound the facts. When the law is on your side, pound the law. When neither is on you side, pound the table.” The post is full of cheap slurs:
And the response of some — only some — Sanders supporters is disappointing, although I guess predictable given that somewhat similar things happened during the 2008 primary. There will, I guess, always be some people who, having made an emotional commitment to a candidate, can’t accept the proposition that someone might share their values but honestly disagree with the candidate’s approach.
Right now I’m getting the kind of correspondence I usually get from Rush Limbaugh listeners, although this time it’s from the left — I’m a crook, I’m a Hillary crony, etc., etc.. OK, been there before — back in 2008 I was even the subject of tales about my son working for the Clintons, which was surprising because I don’t have a son.
But I’m used to this stuff. It’s a bit more shocking to see Mike Konczal — one of our most powerful advocates of financial reform, heroic critic of austerity, and a huge resource for progressives — attacked as one of Hillary’s minions and an ally of the financial industry.
What’s really funny is that neither Mike nor I, nor, I think, any of the other wonks-turned-evil-minions have changed positions.
This is remarkable, and in a very bad way. Krugman conflates the content of his inbox with Dayen’s post via the “minions” in the headline and text, tarring Dayen with being emotional and accusing his of depicting Krugman and Konczal as evil. Moreover he simply chooses to deny the evidence presented by Dayen in his post, (as well as mine) that Krugman and his allies, in fact, reversed positions on specific policy proposals with the only apparent reason being that Sanders is now the architect. If there’s some other rationale, I’m sure Krugman’s supporters would very much like to hear it, but the lack of a rejoinder means the charges stand.
In addition, Krugman considerably exaggerates both Konczal’s fidelity to “progressive” causes and his courage. Konczal is not heroic, nor is he the expert that Krugman holds him out to be. As a financial services industry expert with a strong history of crisis-related scholarly work said via e-mail:
(1) There’s a lot of important technical stuff that neither weighs in on, especially Krugman.
(2) Konczal is always a second (or third) mover on issues.
Nor has Konczal been a stalwart on austerity. He defended his Roosevelt Institute when it decided to accept to take Peterson Institute funding. See these posts for details on what Peterson got for its money:
Konczal was public in his support for this sellout, calling this Judas kiss a “sweet gig.“. An assessment from one of his readers::
June 6, 2011 at 12:14 am
Mike, as a long time fan, your post is deeply disappointing. Especially on the health care stuff and the naivete about Pete Peterson’s goals.
You don’t think a public option is a possiblity? I love you man, but you just need to move over to OFA. Franklin Roosevelt needs his legacy advanced by someone who sees the possiblity that we could have a health system as rational and cost-effective for all Americans as the #$%%$&& Dutch. And someone who sees how not having single payer is destroying both Social Security and Medicare.
You don’t seem to be advancing Franklin Roosevelt’s legacy, just ensuring that the retreat is a bit more orderly. Too bad. Really.
Konczal made more of an effort to respond to Dayen, in Why I (Still) Think Shadow Banking is Key to Financial Reform, without linking to his post until Dayen chided him on it. Dayen replied on Tumblr in detail (scroll down to the key section, which begins, “There seems to be a lot of effort put into deliberately misconstruing my point…”)
Remember, we are now into an argument that Dayen is continuing on Tumblr, meaning it is far less visible than his original Fiscal Times article. Rather than choose to ignore it, Krugman doubles down on the personal attack. From his post Bernie, Hillary, Barack, and Change:
He could be wrong, of course. But if you’re a progressive who not only supports Sanders but is furious with anyone skeptical about his insurgency, someone who considers Mike Konczal a minion and me a corrupt crook, you might want to ask why Barack Obama is saying essentially the same things as the progressive Bernie skeptics. And you might want to think hard about why you’re not just sure that you’re right, but sure that anyone who disagrees must be evil.
Is Krugman off his meds? Where does this paranoid “those who challenge my positions and those of my allies are calling me evil and a corrupt crook” lunacy come from? Straw manning isn’t an adequate depiction of what is going on here, since “straw man” is a misrepresentation of the content of a position. Krugman goes well beyond that to accuse Dayen of personal enmity and moral absolutism.
And the invocation of Obama as a policy expert on banking is absurd. Obama has depended on the support of the FIRE sector from the outset of his life in politics. From a 2012 post, Exclusive: How Obama’s Early Career Success Was Built on Fronting for Chicago Real Estate and Finance:
[Robert] Fitch gave his eye-opening speech before an unlikely audience at an unlikely time: the Harlem Tenants Association in November 2008, hard on the heels of Obama’s electrifying presidential win. The first part contains his prescient prediction: that Obama’s Third Way stance, that we all need to put our differences aside and get along, was tantamount to advocating the interests of the wealthy, since they seldom give anything to the have-nots without a fight.
That discussion alone is reason to read the piece. But the important part is his description of the role that Obama played in the redevelopment of the near South Side of Chicago, and how he and other middle class blacks, including Valerie Jarrett and his wife Michelle, advanced at the expense of poor blacks by aligning themselves with what Fitch calls “friendly FIRE”: powerful real estate players like the Pritzkers and the Crown family, major banks, the University of Chicago, as well as non-profit community developers and real estate reverends.
And lest we forget that this same Obama appointed Timothy Geithner as Treasury Secretary, showed no interest in bringing the banks to heel, when Krugman had helped clear the way for that by depicting nationalization as the best option for Citigroup and Bank of America, and instead told banking industry executives he was the only thing standing between them and the pitchforks? This was the same Obama that failed to press for principal modifications, failed even to use the $75 billion in TARP funds that the Bush Administration had courteously left them for that purpose, failed to clean up mortgage servicing and instead gave the banks a second bailout by covering up for their massive mortgage chain of title issues via the 2012 National Mortgage Settlement?
Krugman, who is more and more a political economist as the year go by, peculiarly chooses to fall back on wonkery as the justification for pooh-poohing Sanders, when as we and others have stressed, he and others were eager to push for the main chance when they had politicians more to their liking fronting for them. As Georgetown professor Adam Levitin said via e-mail:
What Krugman and all the wonks miss are the politics. The real importance of both Glass-Steagall and single-payer is as political economy reforms. Bust up the big banks and you bust up their political power, which enables other reforms. Single-payer changes the bargaining leverage in health care monumentally and that enables price reform outside of the political process, so political power of pharma and insurance is reduced. Krugman, Klein, etc. are oblivious to this because they’re wonks who think policy, not politics, and don’t recognize that the space for policy is determined by politics. If we want whole scale reform, we need to address the politics first.
And Robert Reich similarly underscored the paramount importance of creating an impetus for root and branch reform:
I’ve known Hillary Clinton since she was 19 years old, and have nothing but respect for her. In my view, she’s the most qualified candidate for president of the political system we now have.
But Bernie Sanders is the most qualified candidate to create the political system we should have, because he’s leading a political movement for change.
The upcoming election isn’t about detailed policy proposals. It’s about power – whether those who have it will keep it, or whether average Americans will get some as well.
The Krugman that was early to stand up to the Iraq War, who was incisive before and during the crisis has been very much in absence since Obama took office. It’s hard to understand the loss of intellectual independence. That may not make Krugman any worse than other Democratic party apparatchiks, but he continues to believe he is other than that, and the lashing out at Dayen looks like a wounded denial of his role.
In other words, as much as Krugman’s tantrum is so transparently off beam as to warrant ridicule, and as much it might seem fair minded to give Krugman and Konczal the benefit of the doubt and depict them as hostages of their own self-styled wonkery, that’s just falling for their protective coloring. Their whole argument is political, Hillary is pragmatic and polls better, etc (check out the extreme passive aggressive way Krugman traffics in Clinton talking points about how Bernie is unelectable). They really believe in political corruption as long as Democrats and technocrats are in charge, which is why Hillary’s speaking fees from Wall Street aren’t even worth a mention. They believe in Scalia’s logic on Citizens United. That’s why Konczal defends the Peterson donations to Roosevelt; he really has a right-wing dystopian understanding of corruption and power, that might makes right. In their case, that ‘might’ is the professionalism of technocracy, and choosing who to ignore is their divine right.
The fundamental issue here is that there is deep disagreement within the Democratic Party over values, not over methods. The argument that Hillary and Bernie represent different methods for the same goal is the essential lie of the Krugman/Konczal/Klein world. Krugman and his merry band really want a world shaped by technocrats without accountability or responsibility. This is a world where people in power can ignore who they want (like Dayen) and take money from whoever they want (like Peterson and Enron) and support who they want (like Clinton and Obama) without being held responsible for the policy outcomes that emerge. All opposition is cynically chalked up to racism, as opposed to the inherent evil of a world run by elitist corrupt professionals.
Those who want a more just world aren’t unprofessional children or racists; Sheila Bair, Simon Johnson, Elizabeth Warren, Robert Reich, and so on and so forth believe in a more equitable world where credentialism and access to capital isn’t the dominant element of power. They believe in democracy, where voters can be persuaded to support good ideas and honest politicians that stand up to big money. These are deep disagreements and they aren’t going away.
In reality, it’s not that Konczal and Krugman are stupid, or off their meds. It’s that they are the marketing arm of Wall Street in charge of corralling liberals. They are well-paid for it. But it’s their technocratic and corrupt policy outcomes that have created Trump, and if they aren’t defeated, Trump or a variant like Trump will one day take power.