points to Paul Krugman
on trickledown economics....
What we've just seen is as clear a test of trickledown economics as we're ever likely to get. Twice, in 2001 and in 2003, the administration insisted that a tax cut heavily tilted toward the affluent was just what the economy needed. Officials brushed aside pleas to give relief instead to lower- and middle-income families, who would be more likely to spend the money, and to cash-strapped state and local governments. Given the actual results - huge deficits, but minimal job growth - don't you wish the administration had listened to that advice?
Mr. DeLong has a couple of things to say about the column....
It is a substantial mystery--why there was nobody inside the Bush administration arguing for a good old-fashioned Keynesian fiscal stimulus program that got money to the people most likely to spend it. Even though their forecasts at the end of 2002 were predicting swift employment growth, there is always the questions, "What if something else bad happens?" You would certainly expect political operatives to ask it.
It is for this other other reasons that I find myself shifting my view of the George W. Bush administration. Political hacks seem to have less influence than I had thought. Anti-pragmatic ideologues--people who *know* what the truth is, *know* that it is sunny outside, and don't bother to raise the windowshade to check--have more influence than I had thought.