September 06, 2013

Mr. Krugman's Science: The Curious Silence About Syria

I'm at a loss to understand Paul Krugman's utter silence about President Obama's campaign to bomb Syria.  Mr. Krugman, as serious students of economics know (as oxymoronic a catergory as that might seem), won the Nobel Prize from a Swedish bank for his steadfast opposition to George W. Bush's "war of choice" in Iraq, a war which Bush placed on the "national credit card" while reducing the taxes necessary to pay for such folly.  Mr. Krugman was so exercised about Bush's misrepresentations that led us into an unnecessary war that he warned, quite uncharacteristically, that Bush would ultimately resort to "money printing," the way that all banana republics (as opposed to Banana Republics, which sell cotton shirts from Malaysia) eventually do when they run out of dough.

It turns out that a nation which pays debts in its own currency can't run out of dough.  Mr. Krugman assures us of this now.  I suppose this is the reason he has no problem with bombing Syria, or invading Syria with troops, or whatever.  We have the money after all, even if the national debt is much higher now, both absolutely and as a percentage of GDP.  Indeed, invading Syria, starting yet another war in the Middle East, might stand in for the "alien invasion" he also promotes as a way to galvanize federal spending and, thus, ensure economic recovery for the nation generally.

Cynics might observe that Krugman is a dyed-in-the-wool Democratic partisan, and that Mr. Obama's loose association with that party might explain everything.  They might go further and argue that Mr. Krugman recognizes that he's not likely to draw attention to his economic doodling on the same basis as before.  Would the Swedish bank reward him again with a Nobel Prize for challenging the winner of the 2009 Nobel Peace Prize?  Well, the Peace Prize comes out of Norway, so there's a shot.  I understand the Swedes tell Norwegian jokes.  Vociferous, consistent opposition to Obama's nonstop warmongering (which turns out to be about as flagrant as his predecessor's) might win Mr. Krugman the Nobel Peace Prize, however.  That award hutch is filling up! 

Mr. Krugman always has his eye on the prize, but I don't think he has more Nobels in mind.  He has to worry about the deficiencies in the analyses of almost all other economists, for one thing, and that's a lot right there.  In his column today Mr. Krugman explained why economic policy over the last five years has been so dismal, and why an output gap, the difference between what the American economy could have produced in goods and services over that period, about $2 trillion, was so predictable.

Well, I take that back.  It wasn't actually predictable, because the grand mavens of economics concede that you can't actually predict economic futures with their science.  The New York Times invited a colloquium on this very subject over the last weekend (after first publishing an article asserting that economics was not a science), and the outcome, which the Times appeared to endorse (probably at Mr. Krugman's insistence behind the scenes) was that although economics is not a science which can predict anything, it can explain things, so it's a science. 

An interesting distinction, as Woody Allen said in "Love & Death."  As to its usefulness in explaining things, we have Ben Bernanke's deathless pronouncement before a Congressional committee in October, 2005 :

U.S. house prices have risen by nearly 25 percent over the past two years, noted Bernanke, currently chairman of the president's Council of Economic Advisers, in testimony to Congress's Joint Economic Committee. But these increases, he said, "largely reflect strong economic fundamentals," such as strong growth in jobs, incomes and the number of new households.
Okay, that's an explanation.  We might disagree now that the housing bubble simply reflected "strong economic fundamentals."  We might say that Mr. Bernanke was off his rocker.  Mr. Bernanke holds a PhD in Economics from MIT, however, as does his fellow scientist Paul Krugman.

The Times article, in defending economics as an "explanatory" science, compared it to meteorology, which has "similar" problems of prediction (so the article claimed), but is nevertheless socially useful.  Not to cavil, but Mr. Bernanke was so far off that it would be a little like sitting in the middle of a hurricane and wondering whether the atmospheric low pressure might have something to do with these strong winds we're experiencing. 

Mr. Krugman was able to figure out where the economy ought to be today "on the back of an envelope."  It's all a matter of "textbook macroeconomics," and it tells you that federal spending on a jobs program would have avoided all the pain.  You can explain the past, that is, by applying a theory to it after you already know the results, even if, knowing the preconditions as you did, you could not predict the future. Yeah, why the hell not?  Why look in a textbook, however?  Why not just fart out a theory?

As the Distinguished Research Scientist from a Great Southwestern University points out, how do we distinguish the accuracy of Mr. Krugman's analysis from a hundred other theories we could develop (or fart) and apply to the same factual history?  What about automation, or the continuing problem of losing high-paying jobs to overseas competitors, or the skyrocketing cost of the master resource, petroleum, or the ecological, environmental and overpopulation limits we are hitting with a vengeance?  Maybe the United States has been in a long, slow, but accelerating decline brought about by all these forces, and the housing bubble was just a palliative interruption of that process that fueled consumer spending.  Maybe the "trend lines" on which "potential output" is based are pure moonshine based on completely unrealistic assumptions.

I don't suppose any of these ideas cluttered up the back of the envelope.  The theories of Paul Krugman, Ace Scientist, cannot be falsified.  Like the Letters of Transit that Mr. Ugarte laid his hands on, they "cannot be rescinded, not even questioned."

September 02, 2013

We'll Get Around to Dealing With This Atrocity Just After the Holiday

Naturally, I was as surprised as the next American citizen by the President's volte-face concerning the attack on Syria.  Since my overall analytical model is that the United States is governed by a military-security junta, for which Mr. Obama is the spokesperson (sort of the way that Ronald Reagan was the spokesman for General Electric), the question then became: what was it the Pentagon brass saw that made it decide to punt the issue over to Congress?

We can leave aside the idea that President Obama takes seriously Article 1, Section 8 of the American Constitution, which assigns the war-declaring power to Congress.  When Leon Panetta served as Secretary of Defense, he actually stated overtly to a Congressional committee that the Obama Administration does not consider the Constitution or the War Powers Act of 1973 an impediment to Presidential action in the face of perceived threats.  Panetta, of course, is not a Constitutional scholar; formerly, he played the role of the pharmacist on the old "Dobie Gillis" series.  Still, I have no doubt that he was speaking for the Administration.  In some way that no one wants to take the time to explain, the express grant of power to declare war to Congress in Article 1 is a kind of superfluity; the Founding Fathers apparently didn't really mean it, or it is inconsistent with the role of the President as Commander in Chief and therefore should be disregarded.

I think the Junta's ultimate aim is a tactical nuclear strike on Iran's nuclear facilities, and these practice wars (Libya, Yemen and almost-Syria), all done without Congressional consultation, are simply to keep the military complex in fighting trim and to establish the precedent that the Junta can conduct any war it wants with or without Congress.

So why did the Junta tell Obama to back down?  I think they were concerned about the quality of the operational intelligence.  There is a great deal of uncertainty about whether it was actually the Assad "regime" that used Sarin, the neurotoxic gas in the suburbs of Damascus.  On the surface of things, it seems like an idiotic thing to do.  Assad is winning the Islamic food-fight known as the Syrian civil war.  Why would he do something so clearly counterproductive?  There were rumors swirling that Saudi Arabia had actually supplied the poison gas to anti-Assad forces (al-Qaeda affiliated rebels, just as Saudi Arabia supplied funding to the 9/11 hijackers, who were almost all Saudis - the House of Saud is sort of the Milo Minderbinder of world insurrection). 

One telling point is that the American position was being carried almost exclusively by noted chowderhead John Kerry, one of the stupider members of the U.S. Congress, a man so mediocre that it was revealed during the Bush-Kerry contest of 2004 that Kerry's military aptitude scores were, in fact, lower than those of George W. Bush.  Kerry played the role of Colin Powell in the run-up to the Iraq invasion - an expendable "cut-out" who is going nowhere politically and so it doesn't matter if he's dead wrong about everything he's saying.

Still, it would not help the Junta's ultimate cause if, after this 36-Hour War, or whatever, it became evident that all of this was premised on a false-flag operation.  We don't need to invade Syria just to establish a precedent that is in essence already made.  Obama bombs and invades at will and never seeks Congressional authorization (unlike his predecessor, who was careful to seek it twice, for Afghanistan and Iraq).  Congress never lifts a finger to protest, and I doubt seriously that they really want anything to do with this Syrian decision.

I don't think this Syrian thing is going to happen, which is just as well.  Helping Al-Qaeda destroy the Shia will have to await some other venue, or some other pretext.  It will be up to the military to decide, and then they'll let their Man in the Oval Office know.

I'm not sure this system of governance is actually so bad, when I think about it, and consider the alternatives. Congress is a kind of lunatic asylum for the otherwise unemployable, a congregation of corrupt, anti-intellectual blowhards.  The weenie-flashers and those paying New Orleans whores to diaper them and powder their bottoms are probably the least destructive, since they've found a passion that doesn't involve national security.  Maybe General Jack Ripper was right.  Maybe politicians just don't have the time, the training or the inclination for strategic thought. An interesting note: within an hour of making his epic decision, President Obama was on the first tee, in his khaki shorts and brown-and-white saddle shoes