"EXETER, N.H. - Wise-cracking funnyman Al Franken yesterday body-slammed a demonstrator to the ground after the man tried to shout down Gov. Howard Dean. ... 'I got down low and took his legs out,' said Franken afterwards...'I would have done it if he was a Dean supporter at a Kerry rally...I'm neutral in this race but I'm for freedom of speech..."

It's no coincidence, you know. Enron and Howard Dean have something in common: Paul Krugman was a consultant to both of them. The only difference is that Enron paid Krugman directly. But Dean hasn't had to pay a penny -- Krugman's consulting fees were picked up by the New York Times, since it's been on the op-ed page of America's "newspaper of record" that Krugman has been dispensing his campaign advice.

Let it never be said that Krugman isn't a full-service consultant. He has been touting Dean in the Times, too -- just as he once touted Enron. But now, evidently, it is time to move on and look for another client. In today's column, America's most dangerous liberal pundit offers his advice to the whole Democratic field:

"So here's a test for the Democratic contenders: details of your proposals aside, which of you can do the best job explaining the ongoing budget con to the American people?"

What can this "ongoing budget con" be? It must be pretty important, because less than a month ago a Krugman column lectured America's reporters to "Actually look at the candidates' policy proposals," yet now he himself casts "details of your proposals aside"! So, Mr. Kerry and Mr. Edwards -- listen good!

Krugman says the con begins with an "urban legend" promulgated by conservative think tanks that President Bush is "allowing runaway growth in domestic spending." Oddly, one of those conservative think tanks must be the Krugman Foundation, because only last December Krugman was warning of the "spectacle of a government launching a war, increasing farm subsidies and establishing an expensive new Medicare entitlement."

Even in today's column he allows that recent farm subsidies were "lavish budget increases" and that there has been a "surge in defense and homeland security spending." Well, actually he can't quite make up his mind on that latter point. Last August he wrote that for "homeland security, small-government ideology reigns. The Bush administration has been unwilling to spend enough on any aspect of homeland security, whether it's providing firefighters and police officers with radios or protecting the nation's ports."

But putting those pesky "details aside," as Krugman might say, what is his actual proof that the growth in domestic spending is no more than an "urban legend"? First, Krugman says there can't possibly be an increase in education spending because "No Child Left Behind is rapidly turning into a sick joke." Everyone knows that sick jokes are free. Second, Krugman says that "many government agencies are severely underfinanced," and cites as his single point of evidence that "the head of the National Park Service's police admitted to reporters that her force faced serious budget and staff shortages." Tough for Yogi and Boo-boo, I must admit, but hardly evidence of widespread fiscal restraint.

Okay, all you Democratic candidates -- are you with the program so far? Repeat after Paul: "There's really been no big federal spending increase. It's like the alligators in the New York City sewer system."

Now we're ready to take the next step in the "ongoing budget con." It's time to talk about tax cuts.

Bush's tax cuts, according to Krugman, explain why the federal government's "revenues have plunged." Burst bubble? Tech wreck? Recession? Never heard of it. It's those tax cuts for "the richest 5 percent of families." And what about those across-the-board cuts, famously advertised by the president as being "for everyone who pays income taxes"? Forget about them. According to Krugman, "most people don't feel that their taxes have fallen sharply. And they're right: taxes that fall mainly on middle-income Americans, like the payroll tax, are still near historic highs."

But not according to the Urban Brookings Tax Policy Center -- who tax analyses Krugman has called "impeccable." They say that the fraction of the total tax burden falling on the richest 5 percent is actually higher now -- after Bush's tax cuts -- than it was before. That means that proportionately, the little guys got the bigger tax cut. More "details," I suppose.

But Krugman has more for the Democratic hopefuls to go on. You see, it's not just the tax cuts. Krugman claims that the drop in federal revenues "probably reflects an epidemic of tax avoidance and evasion" by "wealthy people who don't feel like paying taxes." Krugman's evidence for this? None, really, except to recommend that readers buy a book on the subject by fellow Timesman David Cay Johnston. Operators are standing by.

Repeat after Paul: "Ignore that couple thousand bucks you saved in taxes this year! Only the rich got a tax cut! And the greedy bastards are still cheating."

We're almost there. Now let's put it all together into the "ongoing budget con". Here, Mr. Kerry and Mr. Edwards, is what you are supposed to explain to the American people:

• There's really no increase in federal spending.
• Tax cuts for -- and tax evasion by -- the rich have created massive deficits.
• But the right has deliberately planted an "urban legend" that deficits "are the result of runaway spending, which must be curbed."
• So now the right will "slash government programs that help the poor and the middle class."

So repeat after Paul, one last time, Mr. Kerry and Mr. Edwards: "If elected, I will raise taxes and increase government spending."

Hey, wait a second... with advice like that, just whose side is Krugman on, anyway?

Posted by Donald L. Luskin at 6:44 AM | link  

Monday, January 26, 2004