Outsourced to Thomas Levenson:
Bad Andrew (and George): Sullivan (and Will) Can’t Do Economics « The Inverse Square Blog: [T]his quote approvingly retailed by Sullivan from Will should win some kind of prize for the most ideologically blinkered thought (sic) of the year:
Hundreds of billions of dollars that the political class would have liked to direct for its own social and political purposes have been otherwise allocated. That allocation, by government fiat rather than by market forces, must reduce the efficiency of the nation’s stock of capital.
It’s hard to know where to begin with so much idiocy crammed into so few Augustan words.
Just two thoughts:
First: those billions that the notional “political class” would have liked to direct to its own ends did not exist as politically available funds until the crisis occurred.
The notion that in the real world any Congress would have said, hell, just increase the deficit by 150 percent or so to buy cupcakes on the moon is nonsense. I’d like to think that Will (or Sullivan) knows this, but I’m not in fact sure that either of them do. Spending too long repeating half-learned shibboleths from decades before tends to reduce your ability to connect ideas with observations of the real world.
Second: Look at that last sentence in the quote again. A more or less minor error slips in when Will seems to conflate real and financial capital — true beginners buffoonery. For a bigger howler, consider his complaint about government vs. private sector capital allocation. If “market forces” were so effective at allocating capital, we would, of course, not be in the position of bailing out private market players right now.
Why oh why can't we have a better press corps?