Strategy Secrets of Grand Moff Tarkin
Federal Reserve: What We Have Here Is a Failure to Communicate

A Hearty Welcome from the Reality-Based Community to Ben Stein!

Ben Stein seems... well, shrill. I hereby offer him a commission as lieutenant colonel commanding the 17th Keyboarding Battalion (Paul Krugman's Own), the "Fighting Fiscal Conservatives," with a cross appointment as Junior Sub-Deacon Shoggoth in the Order of the Shrill:

Note to the New Treasury Secretary: It's Time to Raise Taxes - New York Times: By BEN STEIN: You almost certainly don't remember little me... you were an intense and clearly brilliant young man. Since then, time has proven you to be a brilliant and intense middle-aged man.... But now you have your work cut out for you as Treasury secretary. You are facing what is, in many ways, the most dangerous economic future since the Depression. Danger is coming on many fronts, only dimly seen by the powers that be in Washington....

Can you imagine, Mr. Paulson, what it will mean to Americans in terms of our currency's value, in terms of the interest we will have to pay to foreign creditors, if our bonds reach junk status? Can you imagine just how crippling a burden this will be on taxpayers?

It gets worse. The annual trade deficit with the rest of the world is approaching $1 trillion.... [W]e have to transfer ownership of roughly $1 trillion of our assets to foreigners every year to cover our excess of international purchases over sales. But the total worth of all the assets in the United States is not greatly more than $50 trillion.... [W]e are basically transferring the value of an average of one of our 50 states to foreign investors every year....

Right now, inflation is moving out of the Federal Reserve's comfort zone.... To raise rates enough to slow down our economy and thus bring down commodity prices amid skyrocketing demand in developing economies is certainly not easy. To do this correctly, you'd need to be a brain surgeon of monetary policy and a cardiac ace of fiscal policy. In other words, there is a great, great deal to be worried about.

May I respectfully suggest that in this environment, ending the estate tax is not a major sensible priority? May I suggest that having the lowest taxes in 65 years on high-income taxpayers is not really as prudent as it might be if we were not running stupendous deficits, with far worse in the future?

I know you are a Republican, and so am I. Now and then, scornful fellow Republicans ask me what kind of Republican I am, since I'm for higher taxes on the rich. I tell them that I am an Eisenhower Republican, the kind who wants to leave a healthier America to posterity. That includes an economy not headed for the status of a banana republic's economy.

Now, I know that a truly great man, Ronald Wilson Reagan, when asked if he were not worried that his tax cuts would burden posterity with a heavy weight, supposedly asked, "What has posterity ever done for me?" Those of us with teenage children certainly know what he meant. But the problem is no longer quite as funny...