By John Stang
Luke discussed several noteable topics today:
1. What’s the liklihood of another coup in Pakistan
2. Balancing the budget could be a stimulus
3. Who’s Alan Krueger?
Monthly Archives: August 2011
A Look at Alan Krueger’s Academic Work
By Luke Brinker
Over at Ezra Klein’s, Brad Plumer rounds up the academic work of incoming Council of Economic Advisers chairman Alan Krueger.
Filed under Uncategorized
Stimulus Sans Deficits?
By Luke Brinker
In an article that’s well worth reading, Yale economist Robert Schiller asserts that the interests of economic stimulus and deficit reduction need not be opposed:
In reality, stimulus can easily take a balanced budget form: The government can simply raise taxes and raise expenditures by the same amount. The idea that balanced budget increases could save an economy stuck in a bad equilibrium goes back to the work of economists Walter Salant and Paul Samuelson in the 1940s, and it’s been taught in introductory economics courses ever since, though somehow it has been absent from public discussion of the current economic situation. Salant and Samuelson argued that in a very weak economy the balanced budget expenditure increases would translate into a one-for-one increase in national income.
In fact, the returns on a balanced budget stimulus are likely to be even greater than that. If the government raises taxes to hire the unemployed, then the unemployed who now get jobs will likely quickly spend all the money they earn on new consumption, since they have been strapped and now have jobs. The currently employed, who will see their taxes go up, will likely not cut their expenditures as much because they are habituated to their current level of consumption. And it is unlikely that a balanced budget stimulus would “crowd out” private expenditures on goods and services by pushing up interest rates. The Fed has already committed itself to keeping interest rates at zero until 2013.
The problem, as Schiller goes on to say, is that even a balanced-budget stimulus is virtually certain to meet near-unanimous Republican opposition. As Rick Perry’s vow to make Washington “inconsequential” in people’s lives (despite his willingness to accept federal help for his state) attests, today’s Republican Party is motivated just as much by a reflexive opposition to robust government intervention in the economy as it is by any desire to reduce the deficit. Even if stimulating the economy can be done without raising deficits, the stubborn reality is that many Republicans see economics as a morality play. Keynesian pump-priming offends GOP sensibilities about government’s role in the economy, and empirical evidence showing that government action can be effective is, to them, a moot point.
Filed under Uncategorized
A New Coup in Pakistan?
By Luke Brinker
Since independence, Pakistan’s politics have been defined by short intervals of civilian governments, punctuated by coups d’état and periods of military rule. (For more on this, I highly recommend current Pakistani Ambassador to the U.S. Husain Haqqani’s superb 2005 book, Pakistan: Between Mosque and Military).
Civilian governments in Pakistan tend to fall when the elites of the Pakistani military and Inter-Services Intelligence Directorate (ISI) perceive that the civilian leaders are weak and ineffectual in the face of security and/or economic challenges. There’s reason to believe Pakistan is vulnerable to a coup now. President Asif Ali Zardari and the ruling Pakistan Peoples Party (PPP) are languishing in public opinion polls. Despite public protests over U.S. military operations in Pakistan, it’s widely believed that Zardari and Prime Minister Yousef Raza Gilani quietly give assent to such operations. The public protests are aimed at mollifying vociferously anti-American public opinion in Pakistan. But the ISI, with longstanding links to militant groups, is growing impatient. The U.S. raid on Osama bin Laden’s Abbotobad compound in May raised the intelligence and military establishment’s furor. Many assume that if a military coup comes, it will be because of the Pakistani government’s unpopularity stemming from its unwillingness to more strongly assert sovereignty in the northwestern tribal areas.
As if the Pakistani government didn’t confront a grave problem in militancy along the Afghan-Pakistani border, the southern port city of Karachi has been mired in ethnic violence for the past few weeks. Upwards of 1000 people have died, and the violence has exposed fissures within the Pakistani government. Feuding politicians, increasing insecurity, and a population desperately seeking order – it has all the makings of another military coup.
Filed under Pakistan
The Right’s Fast Military Fantasy
By John Stang
Jamie Fly at National Review pretty much sums up the rights Libya criticism:
The administration’s mixed messages and initial handwringing about Libya’s revolution in March confused allies as well as intervention skeptics such as China and Russia. Its incoherent legal case for the eventual intervention and the mismatch between the goal of removing Qaddafi and the narrower mandate of United Nations Security Council Resolution 1973 led to bipartisan condemnation of the administration’s actions by Congress.
The U.S. decision to limit its involvement several weeks into the conflict caused cash-strapped European governments to run short on ammunition and scramble to effectively deploy their limited military resources. A more robust use of force during this initial period, including greater use of ground-attack aircraft such as AC-130s and A-10s, could have completely crippled Qaddafi’s forces at the onset. The president’s declaration that there would not be any American boots on the ground left allied special forces on their own to assist the untrained rebel forces and guide NATO air strikes. The participation of American special operators would have undoubtedly put the alliance in a stronger position to pressure Qaddafi. All of these actions allowed Qaddafi to stay in power for months longer than necessary, resulting in countless unnecessary deaths. (emphasis mine)
To put it simply, Obama made a mistake by asking the U.N. for a mandate for a no fly zone and unilateral action by the U.S. would have been faster and more effective. Not to mention, Obama skipped asking for congressional approval, which was also a criticism hurled by the left. This “America’s military does things faster” argument is kind of nonsensical and doesn’t match 20th and 21st century military history at all. When the U.S. entered World War I and II, it was hardly a quick end to the war, Korea was a 3 year escapade, Vietnam took 7 years, Iraq and Afghanistan have taken a better part of a decade. What the right sees is Grenada or Desert Storm (which we got international approval for) as the prime examples of quick American firepower, and both happened under Republican Presidents. But in both those conflicts, we were not securing a nation. We simply bombed and got out after the armies and leaders retreated. Libya is more like Vietnam, Iraq, or Afghanistan where the second step of securing the country is needed. Most military operations take time and are unpredictable. Just bombing the hell out of some country hardly means a victory, as the right suggests.
I should also add that international recognition of conflicts, like Korea, the First Gulf War, and Kosovo, put constraints on the U.S. mission and make it so that way the U.S. pulls out after the mission is complete. Whereas Iraq, where U.N. approval was not granted leads to a longer staying time and a less clear sense of mission. So, international organization recognition has historically led to better, more timely results due to constraints.
I really want to hear what you think: Is the right correct in their criticism of Obama’s Libya policy?
Filed under Libya
