Tuesday, September 20, 2011

Krugman Calls It Class Warfare...

I call it moving toward freedom. Here are Paul Krugman's "notes" on class warfare:
1. Major tax cuts for high-income Americans, much larger as a percentage of income than for the middle class; CBO data here
2. Decline in real minimum wage.

3. Union-busting, aided and abetted by federal policy.

4. Financial deregulation, which has fed inequality because very high incomes come disproportionately from that sector.
There is nothing wrong with tax cuts for the rich, or for the middle class for that matter. There is nothing wrong with allowing people to work at below the current minimum wage rate, if they want to do so. There is nothing wrong with a firm hiring non-union workers. There is nothing wrong with financial deregulation, as long as it doesn't include government backup support for banksters, if they make business mistakes.

Why are none of these wrong? Because they all fall in the realm of advancing freedom. And further, it explains why an interventionist like Krugman would be against them.


  1. Actually, there is some (unintentional) truth to what Krugman is claiming.

    Individual freedom is in fact a fight against classes, because there are no "classes" antagonistic towards each other when there is individual economic freedom.

    So if class warfare is taken to mean fighting against the entire CONCEPT of "classes," because one is fighting not for "the rich class", or "the middle class", or "the poor class", but rather the INDIVIDUAL, then you can count me in to be in full and total support of "class warfare." I am a fighter of individual freedom as against classes.

    Krugman, by engaging in class warfare against the rich, is himself engaging in class warfare, which means class warfare is justified, as long as one is fighting for the "correct" class.

  2. What the hell do the tax rate and these other things have to do with one another? This is a classic case of correlation means causation fallacy. I can tell you as a business owner that when my costs go up, I am going to look for ways to cut expenses or increase prices to make up the lost money. I have never met a business person that becomes more generous when his costs are rising. The unintended consequence of Krugman's tax solution, is that a business person that maybe didn't outsource before may consider to do so now. Krugman must think we live in a world where all our competition comes from the US.

    I have a small consulting firm and my competition comes from all over the globe. It seems that Amercian's at all levels have a hard time understanding that the US businesses are competing against businesses from all over the globe. When you make my cost structure weaker, I have to respond in many of the ways in which Krugman might call class warfare. The US government is in the process of inadvertently pricing low value US workers out of the market.

  3. I'm not sure what's the worse fallacy; conflating income and wealth or society and government.