Larry Kudlow knows his data. But it seems to me he takes pains to present it just so.
For instance, he writes things like: “as a share of GDP, Ronald Reagan cut spending from about 23 percent down to 20 percent.” He also writes things like: “Only recently, under the Bush Republicans, has spending jumped back to slightly over 20 percent” and “Clinton and the Gingrich Congress lowered spending to 18 percent.”
Now, I’d like to expand on those points…
1. Spending in 1980, the last fiscal year before Reagan took office, was 21.7 percent of GDP. In 1988, his last fiscal year in office, spending was 21.3% of GDP. That may be close enough to 20% for Kudlow, but most of the rest of us would have said “Ronald Reagan cut spending from about 23 percent down to 21 percent”, not 20 percent. If you do the math, Reagan managed to decrease the size of the budget by 4 tenths of one percent of GDP, which makes him quite the fiscal conservative in Kudlow’s estimation.
2. Now, (and this is why I say Kudlow knows his data), Reagan actually did cut spending from 23 percent down to 20 percent, well, not 20 percent, but rather 21.3 percent. He managed that by first raising spending above 23 percent for two years in a row. Thus, to comment Reagan for cutting spending from 23 percent is equivalent to praising GW for cutting the deficit in half – you don’t praise a guy for reducing the severity of the problem he himself created.
3. Nice to see Kudlow that maybe Clinton had something to do with the cuts in spending. Spending fell from 22.1 percent of GDP in 1992 to 18.4 percent of GDP in 2000. But here’s the thing… it fell from 22.1 percent of GDP in 1992 to 21.0 percent of GDP in 1994, the year before the Gingrich Congress arrived to do its spending cuts. Now Kudlow is a smart man, he can do the math… why would he give credit to the Gingrich Congress when the rate at which spending was being cut fell after Gingrich took over? To most people, that would indicate that the Gingrich Congress was obstructing Clinton’s attempts to cut spending, would it not?
Now, we’ve looked at stuff Kudlow’s written here at Angry Bear before. I think Kudlow knows precisely what he is doing – I believe he is being dishonest, and I believe he knows he is being dishonest. And I also believe that his employers know he is dishonest. I am pretty sure an honest analysis would be easier to produce than the stuff that Kudlow writes. And since he is paid so very much (I would bet he makes ten times what I make per year, when he has a bad year), it is my opinion they are paying him precisely because they want him to be dishonest.
And if you have been reading this site for more than a month or so, you probably know I think we are partly responsible when we treat Kudlow and his employers and other enablers as respectable.
Update…. I forgot to post the the link to where the data comes from. My apologies. The data is from the Office of Management and Budget, Table 1.3. I’d hate for people reading this to think I simply made up the data.