Wednesday, 26 November 2014 / TRUTH-OUT.ORG
  • Free Marissa and All Black People

    Marissa Alexander made a decision for herself and her family to accelerate the (un-free) freedom that all who live black in the United States have when we aren't formally caged.

  • From Buy Nothing Day to Independence Day

    Let's highlight the importance of framing and narratives, and the power of including the Global South, in a global day of boycott against multinational corporations.

The Downside of Rapid Growth

Thursday, 10 April 2014 00:00 By Paul Krugman, Krugman & Co. | Op-Ed

(Image: Danziger / CartoonArts International / The New York Times Syndicate)(Image: Danziger / CartoonArts International / The New York Times Syndicate)It's fairly common for conservative economists to try to shout down any discussion of income distribution by claiming that distribution is a trivial matter compared with the huge gains from economic growth.

For example, the economist Robert Lucas wrote in an essay in 2004: "Of the tendencies that are harmful to sound economics, the most seductive, and in my opinion the most poisonous, is to focus on questions of distribution."

The usual answer to this is to point out that we don't actually know much about how to produce rapid economic growth - conservatives may think they know (low taxes and all that), but there is no evidence to back up their certainty. And on the other hand, we know how to make a big difference to income distribution, and especially how to reduce extreme poverty.

So why not improve things we know how to improve, as at least part of our economic strategy?

But even this argument may be conceding too much.

A new study by S. V. Subramanian, a professor at the Harvard School of Public Health, found that in poor and lower-middle-income countries, one of the most crucial aspects of well-being, child malnutrition, isn't helped at all by faster growth.

"An increase in (gross domestic product) per capita resulted in an insignificant decline in stunting," Linda Poon recently reported in "Shots," a National Public Radio health blog.

"And when the researchers compared the changes in G.D.P. to the changes in the number of wasting and underweight children, there was no correlation at all. 'It wasn't that (the association) was just weak or small,' Subramanian told Shots.

That was the case, he said, especially for stunting. More striking was the fact that the effect overall 'was just practically zero.' He says things like unequal income distribution and lack of efficient implementation of public services are possible causes."

Yes, rapid growth is good, but it doesn't solve all problems, even if you know how to make it happen, which you don't.

Things Go Better With Kochs

Hey, I had to use that headline before someone else claimed it.

David Weigel at Slate recently reported that Democrats are finding the Koch brothers, David and Charles, to be an effective fundraising tool - emails that bash the Kochs raise three times as much as emails that don't.

And you can see why: the Kochs are perfect villains.

It's not just what they are - serious evildoers who use their wealth to push hard-line right-wing, anti-environmental policies that redound very much to their own benefit.

It's also what they aren't: they're wealthy heirs, not self-made men; they aren't identified with innovation (which you can at least argue for Bill Gates); they haven't made money for other people like Warren Buffett.

So focusing on the Kochs is a way to personalize a vision of conservative politics as a defense of people with unearned privilege.

And here's the thing: that vision is basically right. Very few of the superrich are movie stars, even if the usual suspects love to pretend otherwise. Not many are innovators.

A fair number are self-made wheeler-dealers, but a growing number probably were born to great wealth.

© 2014 The New York Times Company
Truthout has licensed this content. It may not be reproduced by any other source and is not covered by our Creative Commons license.
Paul Krugman joined The New York Times in 1999 as a columnist on the Op-Ed page and continues as a professor of economics and international affairs at Princeton University. He was awarded the Nobel in economic science in 2008. Mr Krugman is the author or editor of 20 books and more than 200 papers in professional journals and edited volumes, including "The Return of Depression Economics" (2008) and "The Conscience of a Liberal" (2007).
Copyright 2014 The New York Times.

Hide Comments

blog comments powered by Disqus
GET DAILY TRUTHOUT UPDATES

FOLLOW togtorsstottofb


The Downside of Rapid Growth

Thursday, 10 April 2014 00:00 By Paul Krugman, Krugman & Co. | Op-Ed

(Image: Danziger / CartoonArts International / The New York Times Syndicate)(Image: Danziger / CartoonArts International / The New York Times Syndicate)It's fairly common for conservative economists to try to shout down any discussion of income distribution by claiming that distribution is a trivial matter compared with the huge gains from economic growth.

For example, the economist Robert Lucas wrote in an essay in 2004: "Of the tendencies that are harmful to sound economics, the most seductive, and in my opinion the most poisonous, is to focus on questions of distribution."

The usual answer to this is to point out that we don't actually know much about how to produce rapid economic growth - conservatives may think they know (low taxes and all that), but there is no evidence to back up their certainty. And on the other hand, we know how to make a big difference to income distribution, and especially how to reduce extreme poverty.

So why not improve things we know how to improve, as at least part of our economic strategy?

But even this argument may be conceding too much.

A new study by S. V. Subramanian, a professor at the Harvard School of Public Health, found that in poor and lower-middle-income countries, one of the most crucial aspects of well-being, child malnutrition, isn't helped at all by faster growth.

"An increase in (gross domestic product) per capita resulted in an insignificant decline in stunting," Linda Poon recently reported in "Shots," a National Public Radio health blog.

"And when the researchers compared the changes in G.D.P. to the changes in the number of wasting and underweight children, there was no correlation at all. 'It wasn't that (the association) was just weak or small,' Subramanian told Shots.

That was the case, he said, especially for stunting. More striking was the fact that the effect overall 'was just practically zero.' He says things like unequal income distribution and lack of efficient implementation of public services are possible causes."

Yes, rapid growth is good, but it doesn't solve all problems, even if you know how to make it happen, which you don't.

Things Go Better With Kochs

Hey, I had to use that headline before someone else claimed it.

David Weigel at Slate recently reported that Democrats are finding the Koch brothers, David and Charles, to be an effective fundraising tool - emails that bash the Kochs raise three times as much as emails that don't.

And you can see why: the Kochs are perfect villains.

It's not just what they are - serious evildoers who use their wealth to push hard-line right-wing, anti-environmental policies that redound very much to their own benefit.

It's also what they aren't: they're wealthy heirs, not self-made men; they aren't identified with innovation (which you can at least argue for Bill Gates); they haven't made money for other people like Warren Buffett.

So focusing on the Kochs is a way to personalize a vision of conservative politics as a defense of people with unearned privilege.

And here's the thing: that vision is basically right. Very few of the superrich are movie stars, even if the usual suspects love to pretend otherwise. Not many are innovators.

A fair number are self-made wheeler-dealers, but a growing number probably were born to great wealth.

© 2014 The New York Times Company
Truthout has licensed this content. It may not be reproduced by any other source and is not covered by our Creative Commons license.
Paul Krugman joined The New York Times in 1999 as a columnist on the Op-Ed page and continues as a professor of economics and international affairs at Princeton University. He was awarded the Nobel in economic science in 2008. Mr Krugman is the author or editor of 20 books and more than 200 papers in professional journals and edited volumes, including "The Return of Depression Economics" (2008) and "The Conscience of a Liberal" (2007).
Copyright 2014 The New York Times.

Hide Comments

blog comments powered by Disqus