Over at Delawareliberal there is a post suggesting that the proper antidote to GOP talking points [which in DL-speak means anybody who ever takes even the slightest issue with the economic viewpoints of Timothy Geitner, Paul Krugman, Robert Reich, and Mark Zandi, or who raises questions about the natural of the so-called stimulus package] is the rant against Congressional economic illiteracy by WaPo business columnist Steven Pearlstein:
Pearlstein’s excellent rant ends up with what I’m guessing is the real target of the piece — Republicans. If only because they were able to suck up alot of the media space over the past few weeks, they’ve had many chances to show off their real ignorance.
The post's author further explains that Pearlstein is--while claiming to be bipartisan in his bashing of Congressional economic illiteracy--really going after conservatives:
[quoting a previous coment] It’s good to be a Conservative.
Which apparently means that you will stay willfully ignorant of the terms of the debate here.
Which is something of Pearlstein’s point.
There are three problems here.
Number one is that Pearlstein is, frankly, considered a pretty major loose cannon, even on the left, as Glenn Greenwald notes at Salon:
It's been truly bizarre watching financial columnist Steven Pearlstein over the last six weeks use his considerable platform at The Washington Post to advance an unbelievably petty, small-minded crusade of railing against what he today-- in the very first sentence of his column -- calls "right-thinking economists and left-leaning bloggers," while insisting over and over that he -- Pearlstein -- has been right all along about everything. What makes his behavior so bizarre, aside from the self-centered fixation that drives it, is that he completely contradicts himself from one column to the next -- he takes fundamentally different positions on the bailout based on whatever short-term circumstances are prevailing -- all in order to declare himself vindicated and, more importantly, to demonize his blogger-enemies and those he dismissively calls "academic economists" (which, for Pearlstein, definitely means, first and foremost, Paul Krugman, and most likely, Nouriel Roubini).
The entire column is worth reading, because it says volumes about the intellectual inconsistencies of pseudo-economists like Pearlstein, who is indicted by Greenwald in his own words as he flits from position to position, depending on the day.
Number Two is that the Delawareliberal post cherry-picks its quotation of Pearlstein to make him sound smarter than he is. Here's one example:
(Discussing Senator Nelson’s claim that $1.1B dollars isn’t effective stimulus)…Maybe the senator could use that opportunity to explain why a dollar spent by the government, or government contractor, to hire doctors, statisticians and software programmers is less stimulative than a dollar spent on hiring civil engineers and bulldozer operators and guys waving orange flags to build highways, which is what the senator says he prefers.
Now here's the full quotation of the relevant two paragraphs:
Meanwhile, Nebraska's other senator, Ben Nelson (D), was heading up a centrist group that was determined to cut $100 billion from the stimulus bill. Among his targets: $1.1 billion for health-care research into what is cost-effective and what is not. An aide explained that, in the senator's opinion, there is "some spending that was more stimulative than other kinds of spending."
Oh really? I'm sure they'd love to have a presentation on that at the next meeting of the American Economic Association. Maybe the senator could use that opportunity to explain why a dollar spent by the government, or government contractor, to hire doctors, statisticians and software programmers is less stimulative than a dollar spent on hiring civil engineers and bulldozer operators and guys waving orange flags to build highways, which is what the senator says he prefers.
OK, two observations here (aside from the minor cavil that Ben Nelson's aide could use a little work on his/her grammar):
Point one: What the aide characterizes as Nelson's position--there is "some spending that was more stimulative than other kinds of spending"--happens to be accurate, at least according to Dr. Mark Zandi of Moody's, who is the current chief economic guru hawking government stimulus spending. In fact, Zandi argues that infrastructure spending is one of the most cost-effective bang for the buck types of spending that government can engage in. Why? Well, infrastructure spending not only creates jobs for the people doing the work (those people waving the flags), but it also creates demand for concrete, and water, and all sorts of other products that have to be produced and sold. Research into health-care efficiency may or may not produce new ways of doing things that are more cost effective (such is the gamble with any research), but are inherently less productive of that sort of secondary stimulus you get from infrastructure spending.
Those statisticians and software programmers with which Pearlstein is so enamored, generally work for consulting companies or universities, which will lop off from 28-35% of the total Federal money sent their way for indirect expenses. This means they will not be using that money to stimulate the economy, they'll be using it to pay their light bills and to subsidize part of the salary of the statistician's secretary so that they can toss a little more money in the reserve fund.
It turns out, unfortunately for the argument that Senator Nelson is an economic moron, that Pearlstein's wrong on this point.
Point two: Pearlstein's snotty little jibe about having Senator Nelson explain himself at the next meeting of the American Economic Association is ironic, considering that hundreds of economists across the nation (including multiple Nobel laureates) are taking direct issue with the blindly Keynesian bent of the stimulus package. If you check that list, by the way, and then double-check it against the membership directory of the AEA, you'll find something very embarassing for Pearlstein.
Number three on the problems with Pearlstein's rant is that he uses administration talking points rather than his brain:
In the next day's Journal, Coburn won additional support for his theory that public-sector employment and output is less worthy than private-sector output from columnist Daniel Henninger. Henninger weighed in with his own list of horror stories from the stimulus bill, including $325 million for trail repair and remediation of abandoned mines on federal lands, $6 billion to reduce the carbon footprint of federal buildings and -- get this! -- $462 million to equip, construct and repair labs at the Centers for Disease Control and Prevention.
"What is most striking is how much 'stimulus' money is being spent on the government's own infrastructure," wrote Henninger. "This bill isn't economic stimulus. It's self-stimulus."
Actually, what's striking is that supposedly intelligent people are horrified at the thought that, during a deep recession, government might try to help the economy by buying up-to-date equipment for the people who protect us from epidemics and infectious diseases, by hiring people to repair environmental damage on federal lands and by contracting with private companies to make federal buildings more energy-efficient.
Actually, what's striking here is Pearlstein himself twisting the facts.
For example, instead of blindly spending money to retrofit Federal buildings, why don't we ask why we have so many of them (over 1,700, not counting military structures) that the government wants them repaired, not to conduct the public's business in many cases, but to make them more attractive to private lessees. You see, the Feds rarely if ever get rid of a building even if the agencies that formerly used it have moved out. Quoth the GAO:
Unlike a private sector company, GSA cannot always dispose of a building simply because it would be economically advantageous to do so.
Or, about the CDC, let's talk budget and facilities:
Pearlstein wants us to believe that the CDC is operating out of shacks, using microscopes discarded by Louis Pasteur. Problem is, the CDC's own website belies this idea; just take a look at the New Facilities page, which talks about buildings already up and running or already funded prior to the pork bill:
Headquarters and Emergency Operations Center
The Headquarters building promotes collaboration by consolidating in one building employees from across the agency, particularly the Office of the Director, the Emergency Operations Center, and the Office of Terrorism Preparedness and Emergency Response.
Global Communications Center
CDC’s Global Communications Center (GCC) opened for business October 3, 2005. A state-of-the-art facility built to replace some of CDC’s aging infrastructure, the Global Communications Center houses the agency’s public information center, an exhibit /education area, a conference center, distance learning facilities, and a CDC visitor security processing area.
The Global Communications Center features high-tech, cutting-edge meeting spaces for training public health professionals. The building also houses a visitor education center, a multimedia facility that offers the public an opportunity to study and learn about public health.
Emerging Infectious Diseases Laboratory
The Emerging Infectious Diseases Laboratory triples CDC’s capacity to research pathogens that require the highest levels of safety precautions, such as Ebola, viral hemorrhagic fevers, monkeypox, and avian influenza.
In FY 2005, CDC completed the next phase of its new facilities in Atlanta. These world-class buildings make it possible for our world-class scientists to extend the boundaries of scientific knowledge and meet the challenges posed by the health threats of the 21st Century.
The inspiring structures are much more than masterpieces of glass, stone, and steel. They symbolize the expanded footprint of CDC’s role as the nation’s health protection agency. Like CDC itself, the buildings are designed for health, built for science, and prepared for tomorrow.
Environmental Health Laboratory
The Environmental Health Laboratory allows scientists to use advanced laboratory science and innovative techniques to prevent diseases resulting from toxic chemical exposures in the environment. Scientists also have the capacity to respond to terrorism and public health emergencies involving chemicals and to improve laboratory methods to diagnose and prevent diseases.
Yeah: either the CDC is lying on its own website, or Pearlstein is full of shit.
As for that remediation of mines on public lands, let's first get Pearlstein off his high horse about environmental clean-up and note that a substantial amount of this allotment goes to trail repair, which is not exactly the same thing as environmental clean-up. And this whole issue of cleaning up those old mines would be more convincing if the Federal government actually knew how much land it owns.
Here's what a MAPPS study two or three years ago found:
How much land does the Federal Government own? Congress can have a healthy debate over whether the government’s real property portfolio is too large or too small, but the answer to the above question is – we really don’t know. In December 2006, the Government Accountability Office (GAO) reported the Federal government failed its audit for FY 2006. GAO has repeatedly (108th, 109th, 110th Congresses) designated Federal Real Property Asset Management one of the high-risk areas within the Federal government most prone to waste, fraud and abuse. One of the reasons cited by GAO is the fact that the government does not have a current, accurate inventory of the land it owns. The General Services Administration (GSA) collects data from at least 30 Federal agencies, but its system has been criticized by GAO for being “unreliable and of limited usefulness” and “not current or reliable.”
Pearlstein would suggest that even government waste is OK now, because it stimulates the economy:
Even if the entire sum were to be stolen by federal employees and spent entirely on fast cars, fancy homes, gambling junkets and fancy clothes, it would still be an $800 billion increase in the demand for goods and services -- a pretty good working definition for economic stimulus. The only question is whether spending it on other things would create more long-term value, which it almost certainly would.
Now I'm not quite sure, following this theory, why anyone would then object to a bailed-out automobile manufacturer buying a new private jet or a corporate CEO lavishly decorating his bathroom. Because it's all good, right Mr. Pearlstein?
Except, of course, that the President doesn't agree with you. Oops. The President seems to agree with those ignorant Senators and Congressmen that government waste, fraud, and abuse is bad. Well, at least that's what he says when he's going after all those evil people in the private sector who make over $500K per year.
Wait! I've got it. What Mr Pearlstein wants us to understand is that government waste is not just OK, it's stimulus, and that private waste is abusive, criminal, and anti-American....
Gee, it turns out that some liberals and progressives supporting massive government stimulus are not above advancing a few BS talking points of their own.
Who'd have thunk it?