Friday, November 9, 2012

Brooks and Krugman.

David Brooks and Paul Krugman both publish columns in the New York Times on Friday.  I usually read Brooks first, due to habit and nostalgia; Brooks' columns remind me of the Wall Street Journal's editorial page between 1991 and 1997, and while his ideas don't always resonate any more, they're familiar. 

Reading Krugman's column, on the other hand, reminds me of the fourth opera in Der Ring des NibelungenGötterdämmerung. Today, his argument is that Obama should "[j]ust say no, and go over the [fiscal] cliff if necessary."

As a negotiating strategy, I can see where Krugman's coming from.  The party with the more stubborn constituency tends to obtain the better results in a negotiation, and Krugman is definitely considered a voice for the Democratic intelligentsia, if not the party as a whole. Thus, his demand for no compromise is likely to be taken seriously, at a minimum, by media observers, if not Republicans.

The problem, though, is that Krugman's argument is that Obama's BATNA is a world where the country will fall off the fiscal cliff, and that the fall won't be that bad.  This is untrue and I think Krugman knows it.  Krugman all but concedes that another recession would be the result, but somehow he (Krugman) thinks the damage that would be inflicted is worth it.

Allowing a recession to occur flies in the face of nearly everything Krugman's been arguing for over the last four years.  He and Brad DeLong have essentially said that the damage to people's lives from the current Lesser Depression could have been avoided by more comprehensive government action. For Krugman to now advocate shutting down the government is not just unbelievable, it's frankly not believable at all.  At best, Krugman's trolling.

Obama, since the earliest days of his presidency, has been willing to reach out and forge compromises. The voters know that (I think), and I think Obama's victory is in part due to his ability to strike deals.  To start pushing the President to abandon that strategy now is a recipe for turning Obama into a lame duck in the first 90 days of his second term (another thing I think Krugman knows).

The Republicans' BATNA is hardly better than Obama's. When the alternatives to a deal are dire for both parties, deals get done, no matter how angry the supporters may be. I wouldn't expect this situation to be any different.


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