President Trump will award the Presidential Medal of Freedom, the nation’s highest civilian honor, to economist Arthur Laffer, the White House announced Friday. The president will honor Laffer on June 19 for his contributions to economic policy. The White House described Laffer as “one of the most influential economists in American history” in announcing the award.
OK the Idiot-in-Chief did say that but repeat after me – Art Laffer is not an economist. Why did Trump debase the Presidential Medal of Freedom and the entire economics profession?
Laffer co-wrote a book published last year titled “Trumponomics: Inside the America First Plan to Revive Our Economy.” His co-author was Stephen Moore, who earlier this year was nominated to serve on the Federal Reserve Board of Governors but withdrew amid bipartisan opposition from senators.
Well at least The Hill got this right. But this?
Laffer championed supply-side economics and gained prominence serving as a top adviser to then-President Reagan. He established what is known as the “Laffer Curve,” which showed that increases in tax rates will eventually cause government revenue to decrease at a certain point. The model has been cited to argue for the benefits of tax cuts. Critics of supply-side economics argue that it has contributed to inequality and disproportionately benefits the wealthy.
The inequality critique is not the only issue with tax cuts that reduce national savings. Couldn’t The Hill note that the 1981 tax cut lowered investment via higher real interest rates as well as appreciated the dollar leading to large trade deficits? Enough with this weak account as Slate got this right!
Trump Gives World’s Worst Economist the Presidential Medal of Freedom
A better read and if you are going to dub Laffer as an economist please note he is a very poor economist. But at least he lavished Trump with praise.
Ho hum, PGL is spreading that fake news again.
Laffer earned a B.A. in Economics from Yale University (1963) and an M.B.A. (1965) and a Ph.D. in Economics (1972) from Stanford University.
Will he make a correction?
While we’re at IT can PGL provide us with the name and year that he got his PHD in economics?
Got my Ph.D. in 1983. I also was a discussant at a conference around then when I got to meet the late great Paul Samuelson. He sort of shocked the room by referring to Art Laffer as “Mr. Laffer”. Bing as a source v. Paul Samuelson as a source? I report, you decide.
But yea getting a Ph.D. is no guarantee of not turning into a charlatan with all due credit to Greg Mankiw for that very accurate description of Laffer.
Wow – the bing link turns up Wikipedia bio. Now that is a reliable source! Snicker! Yea – it also turns up something from CNBC etc. I want to see what Stanford’s records actually show before believing they lowered themselves to grant Laffer a Ph.D. Maybe also a copy of his dissertation. That should be an interesting read!
He may be a economist, but a crappy one. Keep on humping those Bk.
To the actual, you know, point of the post: can you offer a defense of Laffer and supply side economics?
Take all the time you need.
I made a comment on FeSO4 at Robert’s Kiribati is Low but not as Low . . . post. Perhaps you have an answer to it as it is referred to in Robert’s article and in my comment. You appear to be a Physicist or Chemist of some time.
I’m a PhD geneticist. Although I’m a professor of biochemistry and molecular biology, I probably can speak with as much authority on iron feeding of pelagic plankton as Arthur Laffer can on economics. Unlike Laffer, I’m fine admitting my ignorance.
Thought I would ask as it might have been in your expertise arena after having read some of your comments. Thank you.
I remember an old interview with Laffer on TV. He was asked how to determine where you are on the Laffer Curve at any given point in time. He said there is no way to know so when in doubt, cut taxes. In many ways, his curve resembles the Phillips Curve, it looks great on paper and follows general mathematical principles, that’s about all you can say about either of them.
Here is what happens when you analyze actual economic data with the Laffer curve. He drew it upside down! http://angrybearblog.com/2011/10/laffer-curve-and-kimel-curve.html
Laffer seems to be a case of somebody who started out as a serious real economist and then fell into propogandizing for a misapplied version of a theory he went gonzo on.
it is true he want to Yale and got a PhD from Stanford in 1972. Between 1967 and 1975 he published a series of respectable papers in top journals, including the ARE, JPE, ReStat, JMCB, anf JME. He also served as the first Chief Economiist at the OMB under George Schultz 1970-72 without doing anything wacko.
It seems that after he drew his “Laffer curve on a napkin in the mid-70s for Cheney and Rumsfeld he lost it. The theory of course is true: beyond some point higher tax rates will bring lower revenues, with where that point is varying across time and countries. Current estimates in the US have it around 70 percent, but that is uncertain. Laffer himself at least at first did not claim credit for the idea, saying one can find it in both Keynes (I do not know about that) and even back as far as Ibh Khaldun many centuries ago.
The problem has been starting with his advocacy of tax cuts for Reagan in 1980-81 has been his persistent claims that the US, and even individual states most recently Kansas, are on the “far side” of the curve where tax cuts will raise revenues. This was not true for Reagan, and it has not been true for any subsequent case in the US, although it appears to have been true in Russia in 2001 after Putin first came to power and lowered and simplified what had been extremely high and confusing tax rates there.
And he seems to have gotten worse as time goes on. His advice to Kansas was pretty recent and just plain disastrous for that state. Of course he has repeated this nonsense for Trump, especially in his silly book with Moore on Trumponomics, and so far the Trump tax cuts are failing to conform to his predictions, once again. But now he has his payoff for being a good propagandist.
As it is, I hate to say it, I can think of worse economists than Laffer, starting with Moore, who has never been any good and does not have a PhD at all, but including Peter Navarro, who is in the administration and like Laffer started out not being too bad but now seems to have really gone totally off the wall.
Capitalism is fine in theory it just doesn’t work in the real world.