Bleg: James Tobin and Paying for the Viet Nam War
In Conversations with Economists (h/t Kevin Quinn at Econospeak), James Tobin refers to LBJ having made “a mistake” in “raising taxes to pay for the Viet Nam War.”
Google Desktop can’t find the line of reasoning behind that in any of Tobin’s papers that have survived my migrating possibly-non-OCR PDFs over about six computers. Anyone able to point me to Tobin’s preferred alternative?*
UPDATE: The full quote:
Klamer: We experience stagflation….How would you account for this experience within a neo-Keynesian neoclassical framework?
Tobin: That gets us into the history of the economic world in the US since 1966. Probably there were some mistakes in demand management policy. I wouldn’t deny that. In fact, it was a council of neo-Keynesian advisors that told Johnson he should raise taxes for the Vietnam War.
Is this just a reference to the mismanagement pgl has discussed here and at Econospeak so often? And is there evidence that the advisors were arguing that the war was the reason to raise taxes?
*That’s “given that the War was in progress anyway”; not funding and not fighting was not an option, no matter how preferable it might have been without the presence of Dr. Manhattan and his “glowing blue schlong.”