Monday Smackdown: No, Larry Kudlow Is Not an Economist III
Procrastinating on December 19, 2016

Should-Read: Jonathan Chait: Trump Turns to Always-Wrong Pseudo-Economist Lawrence Kudlow: "The emerging cast... suggests... his party’s domestic platform... continued and even intensified...

...Lawrence Kudlow... leading candidate to run his Council of Economic Advisers.... Even hard-core conservatives... like Greg Mankiw... described the arguments used by Kudlow as those of “charlatans and cranks.”...

In 1993, when Bill Clinton proposed an increase in the top tax rate from 31% to 39.6%, Kudlow wrote, “There is no question that President Clinton’s across-the-board tax increases…will throw a wet blanket over the recovery and depress the economy’s long-run potential to grow.” This was wrong....

By December 2000.... “The Clinton policies of rising tax burdens, high interest rates and re-regulation is responsible for the sinking stock market and the slumping economy,” he mourned, though no taxes or re-regulation had taken place since he had credited Reagan for the boom earlier that same year. By the time George W. Bush took office, Kudlow was plumping for his tax-cut plan... endorsed Bush’s argument that the budget surplus he inherited from Clinton — the one Kudlow and his allies had insisted in 1993 could never happen, because the tax hikes would strangle the economy — would turn out to be even larger than forecast. “Faster economic growth and more profitable productivity returns will generate higher tax revenues at the new lower tax-rate levels. Future budget surpluses will rise, not fall.” This was wrong, too....

Kudlow then began to relentlessly tout Bush’s economic program. “The shock therapy of decisive war will elevate the stock market by a couple-thousand points,” he predicted in 2002. That was wrong.

He began to insist that the housing bubble that was forming was a hallucination imagined by Bush’s liberal critics who refused to appreciate the magic of the Bush boom. He made this case over and over (“There’s no recession coming. The pessimistas were wrong. It’s not going to happen. At a bare minimum, we are looking at Goldilocks 2.0. (And that’s a minimum). Goldilocks is alive and well. The Bush boom is alive and well.”) and over (“The Media are Missing the Housing Bottom,” he wrote in July 2008). All of this was wrong. It was historically, massively wrong.

When Obama took office, Kudlow was detecting an “inflationary bubble.” That was wrong. He warned in 2009 that the administration “is waging war on investors. He’s waging war against businesses. He’s waging war against bondholders. These are very bad things.” That was also wrong, and when the recovery proceeded, by 2011, he credited the Bush tax cuts for the recovery....

By 2012, Kudlow found new grounds to test out his theories: Kansas, where he advised Republican governor Sam Brownback to implement a sweeping tax-cut plan that would produce faster growth. This was wrong....

Any economic forecaster is bound to make some wrong predictions. But Kudlow hasn’t made a handful of failed guesses.... Kudlow’s crank theories have a key advantage over the crank theories propounded by, say, the Jim Jones cult: They confer massive windfall benefits upon society’s richest individuals. His unwavering fealty to supply-side theology is the very characteristic that proves his ideological bona fides and qualifies him to give Trump advice....

If you put Republicans in office, the Kudlows of the world will be designing their policy agenda, and the agenda will be designed around lower taxes for rich people. And Kudlow will insist it worked.

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