Paul Krugman's Lecture

I was recently privileged with an opportunity to attend this lecture by Paul Krugman, the author of "The Great Unraveling" and distinguished economics professor from Princeton, share his views at ASU's Gammage auditorium. Although he was preaching to the choir, there were a few conservatives in the audience. Hearing him cite the tactics used by the Bush administration to se deceptive practices in their tax cuts really shocked me and I feel I should share what he told me.

Basically, in Washington most proposals are analyzed in a 10-year window. Meaning, that the tax cuts proposed back in 2001 were said to cost about $350 billion. However, the trick is that the cost analysis was only done for the first 10 years because the bill was designed to expire in 2011. So in actuality if the bill was a permanent it would cost over $800 billion. The problem now is that the last two years, the Bush administration has continued to say "Why isn't this permanent? We need to make it permanent.". They are not mentioning that the $350 billion tax cut that was passed will actually cost more than twice that. Why? Because it's easier to get it passed that way. Now that it's already in affect people aren't aware of the actual long term cost associated with it. In an essence they have used knowingly deceptive practices to get a bill sneaked passed congress and the American public.

Krugman also touched on the methods used by the Bush administration in promoting their ideas. For instance, the spokesman-ship for the first tax cut was based on the foundation that we had a surplus that needed to be distributed. Half way through the year when it became apparent that our surplus had been spent by out of control government spending, the focus shifted to serving as an economic stimulus to maintain the current economy. Then, after it became apparent that the economy was already taking a dive the focus shifted again... the Bush administration said the tax cut would be a sort of foundation for economic recovery. It's no surprise that they have done the same thing with the Iraq war. First it was about terrorism, then it was the WMD, and now it's about liberating Iraq. The focus remains the same but the reasoning is shifting. The real question is why do we allow ourselves to be fooled.

We're stuck in a war that we entered into under the basis of false presumptions and we have a president who's fiscal policy consists of cutting taxes and increasing spending. This type of out of control leadership coupled with tactfully deceptive marketing practices worry me a lot.