Krugman Strikes Out

I have come to expect wooly-headed partisanship from Paul Krugman instead of economic analysis, and that is one reason I started this blog. The other reason was that I want to have another source that attacks and exposes the Keynesian fallacies for what they are: dangerous nonsense.

Nonetheless, even Krugman has managed to go where few economists have gone before: into total partisan fantasyland. I figured he would be crowing in his Monday column, and I am correct. Krugman's utterings in the aftermath of the passage of the healthcare nationalization legislation are not worthy of anyone who has a doctorate from one of the most prestigious economics programs in the world. He has given talking points that I would expect to read on the Daily Kos or in one of the ubiquitous emails I receive from the Democratic Party.

Krugman has entitled his column, "Fear Strikes Out," but in reality, Krugman has struck out, demonstrating not only his outright partisanship, but also his dishonesty. Let me begin.

He begins the column with a long quote from President Obama. Now, I generally don't like to begin any of my articles with quotes from politicians unless I am taking the scalpel to their words, as we can figure that however lofty the rhetoric might be, there is an iron fist inside a velvet glove, and this is no exception.

However, after quoting Obama, he then turns to Newt Gingrich:

And on the other side, here’s what Newt Gingrich, the Republican former speaker of the House — a man celebrated by many in his party as an intellectual leader — had to say: If Democrats pass health reform, “They will have destroyed their party much as Lyndon Johnson shattered the Democratic Party for 40 years” by passing civil rights legislation.

Notice that "passing civil rights legislation" was not what Gingrich said. No, Krugman inserted those words to imply that anyone who opposed the legislation was a racist.

Now, I don't like to defend the loathsome Gingrich, and I don't forget that for all of his lofty "limited government" rhetoric, he was just another politician grabbing what he could from the till. However, one has to understand the tactics that Krugman is using, and they are absolutely despicable.

He points out that someone from the Tea Party protests called John Lewis the "N-word," which is "proof" that opposition to the medical care legislation was undergirded with racism. While I also condemn the use of such language, nonetheless, Krugman uses the incident in a way that promotes a non sequitur. Do you have difficulties with the legislation? Do you think that it is going to pile on trillions of dollars of unfunded liabilities on our present and future generations at a time when the government of this country is essentially bankrupt?

Well, if you believe that, or even think it, then you also are a racist. Lest you think I am exaggerating, read on:

Instead, I want you to consider the contrast: on one side, the closing argument was an appeal to our better angels, urging politicians to do what is right, even if it hurts their careers; on the other side, callous cynicism. Think about what it means to condemn health reform by comparing it to the Civil Rights Act. Who in modern America would say that L.B.J. did the wrong thing by pushing for racial equality? (Actually, we know who: the people at the Tea Party protest who hurled racial epithets at Democratic members of Congress on the eve of the vote.

However, what if you are someone who says that the Law of Scarcity was not repealed, no matter what Krugman says? Well, you, too, are a cynical racist. Why? The Congressional Budget Office has declared this legislation to be fiscally sound, and we know that the CBO always gets it right, and that it is "nonpartisan" and never affected by politics:

Yes, a few conservative policy intellectuals, after making a show of thinking hard about the issues, claimed to be disturbed by reform’s fiscal implications (but were strangely unmoved by the clean bill of fiscal health from the Congressional Budget Office) or to want stronger action on costs (even though this reform does more to tackle health care costs than any previous legislation). For the most part, however, opponents of reform didn’t even pretend to engage with the reality either of the existing health care system or of the moderate, centrist plan — very close in outline to the reform Mitt Romney introduced in Massachusetts — that Democrats were proposing.

Ah! We have proof! Mitt Romney pushed what Krugman claims is a similar plan in Massachusetts, and Romney is a Republican, so any opposition to the government's newest edict can only be made on the basis of racism! Don't you see the logic? It is all there!

Krugman, however, is not done. He finishes with this benediction:

This is, of course, a political victory for President Obama, and a triumph for Nancy Pelosi, the House speaker. But it is also a victory for America’s soul. In the end, a vicious, unprincipled fear offensive failed to block reform. This time, fear struck out.

Yes, if you think that legislation that essentially nationalizes medical care, promises price controls, has new provisions that will criminalize actions that once fell into the category of voluntary, peaceful trade, and imposes coercive measures along with empowering the Internal Revenue Service, then you are on the side of the demons. You are a vicious, lying racist who wants everyone to get sick and not have healthcare.

Am I exaggerating? Read the column and see for yourself. You cannot both take a hard look at the fiscal provisions of this legislation and ask questions about it, for if you do, then you are a vicious racist.

There is more in this column and I will take a future look at some other points he makes, but for now, I leave readers with this sobering thought: The 2008 Nobel laureate in economics has declared that questioning this legislation through the lens of the simple laws of economics is an act of racism.

Krugman takes on the Austrians and Ron Paul (and, as usual, misrepresents what they are saying)

Gee, hoodathunkitt? Paul Krugman hates Ron Paul. It is not enough for Dr. Paul to want to leave abortion to state legislatures (where the U.S. Constitution would place it), but the very fact that Dr. Paul is personally opposed to abortion and would not perform one is enough to send Krugman into a rage.

Furthermore, Krugman attacks Dr. Paul on the matter of civil rights. Now, keep in mind that Dr. Paul is not against civil rights per se, given that no other person on the scene, Democrat or Republican, that is running for president that openly opposes the police state that both parties have created. (Sorry, Krugman. One cannot support both civil rights AND a police state. So, who is against civil rights?)

Anyway, Krugman is not referring to Dr. Paul's views on race, but rather Dr. Paul's view of the 1964 Civil Rights Act. Like all Progressives, Krugman holds that any law or regulation that is created in the name of something like civil rights is in itself the very essence of those rights. As Frederic Bastiat wrote in The Law in 1848, socialists (and I should add, Progressives) always couched beliefs within a specific government action:

Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.

We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.

Likewise, according to Paul Krugman, the only reason one could oppose sections of the Civil Rights Act which give government huge swaths of control over private property is racism. (Likewise, if one thinks that ANY environmental regulation is bad or unnecessary, then one is in favor of having feces wash up on beaches, to paraphrase Anthony Lewis, who also wrote his columns at the NYT.)

But Krugman was only getting warmed up when he accused Ron Paul of being a racist and a misogynist. (And why else would one be opposed to abortion than out of hatred for women? Gloria Steinem has declared such, and so it is an established truth, at least at Princeton University and the NYT.)

Ron Paul, writes Krugman:

...(ignores) reality, clinging to his ideology even as the facts have demonstrated that ideology’s wrongness. And, even more unfortunately, Paulist ideology now dominates a Republican Party that used to know better.

Given the open opposition that Republican stalwarts have exhibited toward Dr. Paul, the idea that his "ideology" is dominating the GOP is a very sick joke, but Krugman seems to be full of humor these days. Unfortunately, he totally misstates the position that Austrians have on money, and he further writes that all Austrians believe that the monetary base is exactly the same as money that is circulating.

First, as he points out in the article, the Fed massively increased the monetary base and some Austrians have said that sooner or later if that base is turned into large-scale lending, we are going to have inflation. That is a no-brainer. However, because some Austrians have said that maybe inflation will occur sooner rather than later, according to Krugman, that means that all Austrian theory on money is wrong. (This is what the ancients once called a non sequitur, but without the non sequitur, Krugman would not have any columns.

Second, Krugman continues in that insistence:

Austrians, and for that matter many right-leaning economists, were sure about what would happen as a result: There would be devastating inflation. One popular Austrian commentator who has advised Mr. Paul, Peter Schiff, even warned (on Glenn Beck’s TV show) of the possibility of Zimbabwe-style hyperinflation in the near future.

So here we are, three years later. How’s it going? Inflation has fluctuated, but, at the end of the day, consumer prices have risen just 4.5 percent, meaning an average annual inflation rate of only 1.5 percent. Who could have predicted that printing so much money would cause so little inflation? Well, I could. And did. And so did others who understood the Keynesian economics Mr. Paul reviles. But Mr. Paul’s supporters continue to claim, somehow, that he has been right about everything.

Austrians are not shocked at what has transpired. The economy, thanks to the bailouts, explosion of regulations, and incendiary rhetoric from the White House, is mired in depression, just as Austrians predicted it would be if the policies of the past four years were followed. As long as the monetary base remains just that -- a base -- and the money does not circulate, the official rate of inflation will be low. What I do find interesting, however, is Krugman's insistence that commodity prices have nothing to do with inflation, that the only reason they rise and fall is because of demand from "emerging economies" and "volatility." (Of course, "volatility" is an effect, not a cause, but since Keynesians regularly confuse cause and effect, we should not be surprised at Krugman's conclusions.)

You see, if Austrians are wrong in their belief that an expansion of money in circulation will force up prices (and that is what Krugman insinuates), then all of monetary theory is turned upside down. For that matter, Krugman already is on the record in calling for the Fed to directly purchase U.S. Government securities on the primary market, which in essence would be financing government via the printing press. Does Krugman also believe that such an action would not have a huge effect upon prices of goods, or does he want us to believe that any predictions of inflation here would be wrong?

Krugman's insistence that Austrians are ignorant about money is, well, ignorant. Austrians say that money is a secondary good which has a primary use to facilitate exchanges, and its productivity exists in the fact that it allows exchanges to occur that would not happen in a barter economy. Austrians further hold that money is subject to all of the laws of economics, including the Law of Marginal Utility (no, we don't hold that it simply is a quantity variable).

However, one of the most important aspects of Austrian thinking on money is that Austrians emphasize the transmission mechanism of new money being injected into the economy, and that transmission is non-neutral, for those receiving the new money first will be able to pay for goods at the old prices, but with new incomes. This view contrasts with the Keynesian viewpoint that monetary transmission is neutral, and that the only thing which matters is that money get put into the economy so that someone can spend it.

Moreover, Austrians also point out that the injection of new money into the economy also will have an effect upon the relative prices of goods, and that the relations will change as more money pours in. This contrasts with Krugman's view that new money has no such effect, and that everyone benefits equally from monetary injections. (In Krugman's view, while inflation benefits debtors at the expense of creditors, that is OK because he falsely assumes that all creditors are the "one percent" and that all debtors are in the other category.)

So, because hyperinflation has not hit, Austrians are totally ignorant about money, and that includes Ron Paul. We are dealing with timing, not monetary theory, and Krugman by confusing the former and latter, demonstrates his own ignorance about monetary matters.

Creating caricatures is "listening"? Only in Wonderland!

It seems that Paul Krugman really does listen to what others who are not Keynesians have to say. Really! Why do I know that? Krugman himself says it:

In my experience with these things – which I find both within economics and more broadly – is that if you ask a liberal or a saltwater economist, “What would somebody on the other side of this divide say here? What would their version of it be?” A liberal can do that. A liberal can talk coherently about what the conservative view is because people like me actually do listen. We don’t think it’s right, but we pay enough attention to see what the other person is trying to get at.

The reverse is not true. You try to get someone who is fiercely anti-Keynesian to even explain what a Keynesian economic argument is, they can’t do it. They can’t get it remotely right. Or if you ask a conservative, “What do liberals want?” You get this bizarre stuff – for example, that liberals want everybody to ride trains because it makes people more susceptible to collectivism. You just have to look at the realities of the way each side talks and what they know. One side of the picture is open-minded and sceptical. We have views that are different, but they’re arrived at through paying attention. The other side has dogmatic views.

In his own blog, Cafe Hayek, Don Boudreaux has his own reply to Krugman, and you can read it here. Now, for a guy who insists calling the Austrian Theory of the Business Cycle the "Hangover Theory" (and then explaining it in caricature form and simply refusing to acknowledge that Austrians do not explain it in the terms Krugman uses), his statement is pretty rich. Furthermore, I looked at some past posts of my blog and found a number of places where Krugman has declared that opposition to his points is motivated, at least in large part, by racism and hatred of others. (Last year, Krugman insisted that anyone opposed to QE2 had that viewpoint because that person wanted others to suffer and be out of work.)

So, despite Krugman's insistence that HE and HIS FRIENDS all are the epitome of open-mindedness and that everyone else is a dolt and idiot, I let his own columns and his own comments speak for themselves.

I have met a number of economists who won the Nobel, including Krugman, James Buchanan, Gary Becker, Milton Friedman, and F.A. Hayek. Interestingly, the latter four were gracious to their intellectual opponents and took great efforts to be able to explain differing points of view. And I never saw those four use the kind of attack language that Krugman regularly uses in his columns, articles, blog posts, and interviews.

The madness of fiat money

Yes, I know that Paul Krugman has yet another budget screed in which he calls for higher taxes, more government spending, and all that. Surprise, surprise, surprise: he falls down and worships the proposal that comes from the hard-core socialist wing of the Democratic Party (the "Progressive Caucus").

However, I am more interested in his recent blog post, "Money Madness," in which he once again explains his belief that a system of fiat money is just fine with him, and if it is fine with Krugman, then it is the Way, the Truth, and the Life. He writes:

The whole tone of this discussion is reminiscent of the way people talked about the gold standard back when it was widely thought that any meddling with the sacred role of a metal with precisely 79 protons would mean the demise of civilization. But it has been 80 years since Britain went off gold, and last I noticed, William and Kate weren’t getting married in a desolate wasteland. We’ve had freely floating exchange rates for almost 40 years....

There you have it. Since we have been outright printing money for nearly a century, everything is just great, right? Furthermore, what Krugman really is saying is that we would not have had prosperity at all. We would be stuck in depression with high unemployment and a very uncertain future.

Oh, wait! After massive new spending, QE2 (which, contra Krugman, turned out to be a big deal), we have high unemployment and a very uncertain future. Krugman's reply? Print more money.

Are food and energy prices rising? Why, that is due to speculators and demand from elsewhere. It couldn't have anything to do with Ben Bernanke's showering of the world with dollars. Why? If it did, then Krugman would have to admit that maybe inflation was not a good thing.

But, Krugman does not stop there. No, he gives us his monetary philosophy of life:

Anyway, money and monetary policy are basically technical issues, albeit important ones. The fate of Western society is not at stake, nor is there a deep moral issue in allowing the purchasing power of the medium of exchange to depreciate modestly over time. Calm down, everyone.

I would beg to differ. If I were to enter your household and take your property, albeit slowly, you would still call it theft.

However, when the government says that you have to use its money for exchanges, and then purposely depreciates that money, leaving you poorer in the process, that is a moral issue. Krugman would counter, of course, that it is the very inflation that makes the economy grow, but he gives no methodology of this "technical" claim.

By the way, when Krugman claimed last year that those who opposed QE2 did so because they wanted people to suffer and be out of work, was he not making a "moral claim"? When he claims that opposition to Keynesian policies is done out of racism, is that not a "moral claim"?

So, I guess that when Krugman attacks people who disagree with him and calls them racists, he is making a "technical" statement. Anyone who points out that deliberate government depreciation of money just might have a moral connotation is engaging in metaphysics.

In the end, with Krugman it is "heads I win, tails your lose."

Paul Krugman: Think Exactly Like Me, or You Are a Racist

Paul Krugman, as a New York Times columnist, is supposed to operate independently of the newspaper's editorial policy, in that his columns are supposed to reflect his thinking and not be done in coordination with the newspaper's editorials. Of course, his latest attack on Rand Paul and the appearance of the paper's editorial calling Paul a racist just might be coincidence, but I have my doubts.

Why is Rand Paul a "racist," according to Krugman and his employer? He is a racist because he does not believe that the federal government should dictate anti-discrimination policies to private businesses via the Civil Rights Act of 1964. Keep in mind that Paul has not used racially-inflammatory language during his campaign or even brought up race at all. However, if he does not worship at the feet of the feds, then he is by definition a racist, or at least that is what they claim at the NYT.

Writes Krugman:

You know, if Rand Paul loses his Senate race, in a way I’ll be sorry. He’s been so much fun in such a short period of time!

Anyway, given the flap over his assertion that he wouldn’t support the Civil Rights Act of 1964, some Republicans are making the argument that they were the party of civil rights, while Democrats were the enemies. And there’s some truth to that: in the 1950s and early 1960s, the opponents of civil right were largely Southern Democrats.

But what happened to those Southern Democrats? They became Republicans. And I’m not just speaking metaphorically: many Republican members of Congress during the era of GOP dominance were, literally, former Democrats who switched parties.

The point is that today’s Democratic party is, effectively, the party of Lyndon Johnson, whose decision to push forward on civil rights cost the party the South, as he knew it would. Meanwhile, today’s Republican party is the party of Richard Nixon, who cynically exploited the backlash against civil rights to build a new majority.

Therefore, Rand Paul is a "Southern Democrat" who is a racist, like Theo Bilbo or George Wallace in his earlier years. Now, Krugman offers no proof that Paul is a racist; he just makes the connection.

Likewise, his employer declares:

In a handful of remarkably candid interviews since winning Kentucky’s Republican Senate primary this week, Mr. Paul made it clear that he does not understand the nature of racial progress in this country.

As a longtime libertarian, he espouses the view that personal freedom should supersede all government intervention. Neighborhood associations should be allowed to discriminate on the basis of race, he has written, and private businesses ought to be able to refuse service to anyone they wish. Under this philosophy, the punishment for a lunch counter that refuses to seat black customers would be public shunning, not a court order.

It is a theory of liberty with roots in America’s creation, but the succeeding centuries have shown how ineffective it was in promoting a civil society. The freedom of a few people to discriminate meant generations of less freedom for large groups of others.

It was only government power that ended slavery and abolished Jim Crow, neither of which would have been eliminated by a purely free market. It was government that rescued the economy from the Depression and promoted safety and equality in the workplace. (Emphasis mine)

Republicans in Washington have breathlessly distanced themselves from Mr. Paul’s remarks, afraid that voters might tar them with the same extremist brush. But as they continue to fight the new health care law and oppose greater financial regulation, claiming the federal government is overstepping its bounds, they should notice that the distance is closing.

Now, the editors don't explain how the government "rescued" the economy from the Great Depression, given that the rate of unemployment in 1939 was substantially higher than it was in 1930 or even 1931, and was close to the 1933 high of 25 percent. However, we are speaking of the NYT, the same newspaper that tried to claim that Duke lacrosse player Reade Seligmann simultaneously could be both at a bank teller and at a party miles away raping Crystal Mangum. This is a newspaper that believes its very words supercede reality.

Krugman makes one more interesting comment: "So yes, let’s honor the great Republicans of yore; I’m a Lincoln man, myself."

That is interesting. Lincoln was a self-proclaimed racist, whose Illinois did not permit free black people to live within its state borders. Lincoln also ordered his armies to loot, burn down whole cities and towns, and whose armies went pillaging and raping as they went along.

Thus, if I am to follow Krugman's logic (and the logic of his employer), then Krugman favors rape, racism, and destruction. Hey, if he is a "Lincoln man," then he has to favor what Lincoln did.

How DARE Anyone Protest This Bill!

In the days before the vote on the allegedly "historic" Obamacare bill in the House of Representatives, recalcitrant Democrats were receiving threats overt and covert from constituents, unions, and others. A number of them had to deal with obscenity-laden threats from Rahm Emmanuel, courtesy of the Obama White House.

However, such actions were not extremism. No, they were statesmanship, or at least in the Wonderland inhabited by the likes of Paul Krugman.

However, whatever rumors or even lies about the protests of those who were against this monstrosity of a bill are being told, Krugman is there to repeat them, and he does so again in his column today, "Going to Extreme."

Before taking on today's missive, I want to deal with a Big Lie that Krugman was helping to spread. Remember the supposed screaming of the "N-word" at black members of Congress last week? Krugman and all of the others in the media made hay of it. However, it turns out that the account was a fabrication, made up by a reporter from the McClatchy newspaper chain.

(In case you are not familiar with the leftist McClatchy chain, one of its newspapers, the News & Observer of Raleigh, North Carolina, started off the infamous Duke Lacrosse Hoax with a fabricated account written by a female reporter who now works for a Marxist publication. More than any other media outlet, the McClatchy chain was responsible for this patently-false hoax and subsequent attempted frame of three young men by the prosecution and police of Durham. That McClatchy would promote another Big Lie does not surprise me in the least.)

That it turns out that no one -- not one person -- has been able to pick up any of those supposed slurs on the numerous videos made of that moment. This was a fabrication, pure and simple, yet Krugman gleefully jumped on it because it was "proof" that anyone who opposed Obamacare is a racist.

Ironically, Krugman's employer put a correction in his "Fear Strikes Out" column because Krugman had falsely claimed that Newt Gingrich was saying that "civil rights" damaged the Democratic Party. So, Krugman himself is not above promoting fabrications when it suits him. (Of course, Keynesian economics is a fabrication, but that is a discussion for another time and post.)

So, in today's column, we read more of the same:

But back to the main theme. What has been really striking has been the eliminationist rhetoric of the G.O.P., coming not from some radical fringe but from the party’s leaders. John Boehner, the House minority leader, declared that the passage of health reform was “Armageddon.” The Republican National Committee put out a fund-raising appeal that included a picture of Nancy Pelosi, the speaker of the House, surrounded by flames, while the committee’s chairman declared that it was time to put Ms. Pelosi on “the firing line.” And Sarah Palin put out a map literally putting Democratic lawmakers in the cross hairs of a rifle sight.

All of this goes far beyond politics as usual. Democrats had a lot of harsh things to say about former President George W. Bush — but you’ll search in vain for anything comparably menacing, anything that even hinted at an appeal to violence, from members of Congress, let alone senior party officials.

So, we are back to the same partisan vitriol: We Democrats are nice people, those Republicans are a bunch of violent kooks. Now, to me, both parties are full of people who have advocated violence against Americans and much of the rest of the world, and currently are carrying out those threats at home and abroad.

Krugman then makes this astonishing claim:

Mr. Obama seems to have sincerely believed that he would face a different reception. And he made a real try at bipartisanship, nearly losing his chance at health reform by frittering away months in a vain attempt to get a few Republicans on board. At this point, however, it’s clear that any Democratic president will face total opposition from a Republican Party that is completely dominated by right-wing extremists.

For today’s G.O.P. is, fully and finally, the party of Ronald Reagan — not Reagan the pragmatic politician, who could and did strike deals with Democrats, but Reagan the antigovernment fanatic, who warned that Medicare would destroy American freedom. It’s a party that sees modest efforts to improve Americans’ economic and health security not merely as unwise, but as monstrous. It’s a party in which paranoid fantasies about the other side — Obama is a socialist, Democrats have totalitarian ambitions — are mainstream. And, as a result, it’s a party that fundamentally doesn’t accept anyone else’s right to govern.

Please. This is a president who made the hyper-partisan Emmanuel his chief of staff, and who made it clear that he had the votes, and he was going to do whatever he pleased. Obama told Republicans that if they were not going to go along with what he wanted, then it didn't matter, anyway. Furthermore, the Democrats quickly have turned these alleged "threats" of which Krugman speaks into fundraising opportunities, which always makes me a bit suspicious. That Krugman tries to paint a picture of a naive, trusting Obama who was stabbed in the back by those mean, nasty, vicious, racist Republicans is junk that at best is saved for the Daily Kos or Media Matters.

Paul Krugman represents the Eastern, secular, urban Democrat who absolutely cannot understand nor tolerate anything other than the culture in which he lives. Should anyone be different, well, that person really needs at best to pay taxes, and bend over and take whatever the Krugman-approved government gives him or her. Any opposition to his ideas can be motivated only by racism, and whatever "ism" he pulls out of his hat.

Krugman on Freedom

In dealing with Paul Krugman's last column, I concentrated on his accusation that the only possible motivation one could have to question ObamaCare was racism. Yet, there is a paragraph in Krugman's column that points to another issue: freedom itself. He writes:

I’d argue that Mr. Gingrich is wrong about that: proposals to guarantee health insurance are often controversial before they go into effect — Ronald Reagan famously argued that Medicare would mean the end of American freedom — but always popular once enacted.

Krugman's point is that if an entitlement is "popular," then any argument about "freedom" is irrelevant. Now, I can understand why a Medicare benefit might be popular, since it involves people receiving care for which they do not pay. To give an extreme but pertinent example, I am sure that when Hitler's regime stole the property of wealthy Jews and gave it to politically-connected Nazis, that the program was popular with those who received the benefits, yet no one is going to accuse Hitler's regime of enhancing freedom.

Let us look at the statement that Reagan made in 1961 and see whether or not Krugman has fairly characterized it:

One of the traditional methods of imposing statism or socialism on a people has been by way of medicine. It's very easy to disguise a medical program as a humanitarian project. . . . Now, the American people, if you put it to them about socialized medicine and gave them a chance to choose, would unhesitatingly vote against it. We have an example of this. Under the Truman administration it was proposed that we have a compulsory health insurance program for all people in the United States, and, of course, the American people unhesitatingly rejected this.

Reagan added:

The doctor begins to lose freedom. . . . First you decide that the doctor can have so many patients. They are equally divided among the various doctors by the government. But then doctors aren’t equally divided geographically. So a doctor decides he wants to practice in one town and the government has to say to him, you can't live in that town. They already have enough doctors. You have to go someplace else. And from here it's only a short step to dictating where he will go. . . . All of us can see what happens once you establish the precedent that the government can determine a man's working place and his working methods, determine his employment. From here it's a short step to all the rest of socialism, to determining his pay. And pretty soon your son won't decide, when he's in school, where he will go or what he will do for a living. He will wait for the government to tell him where he will go to work and what he will do.

Indeed, what we have seen in the last four decades has been the disconnect between doctor and patient, as the doctor is governed by federal oversight, the Drug Enforcement Agency, Medicare "cost controls" from Medicare, insurer oversight, and the trial lawyers. Second, the nature of taxation is this: if government provides benefits to one group of people by taxing another group of people, then the people who are taxed do lose some of their freedom.

Am I exaggerating? Has any reader ever been subjected to an Internal Revenue Service audit, or known anyone who has gone through that experience? Who is the master and who is the servant? Does this relationship enhance or diminish freedom?

Don't kid yourselves. We are less free today, as the government has ordered everyone to have health insurance, or else face the wrath of the IRS. Krugman may call that freedom, but I call it coercion and yet another example of the master-servant relationship we have with our government.

Granted, Krugman is speaking of what "Progressives" call "Positive Freedom" in which government forces others to provide a benefit to someone, when then does not have to pay directly for the largess. According to Krugman and others, that person if "more free" because he or she now can direct income elsewhere. However, that is "freedom" gained at the expense of other people, who now are less free.

Guy Rexford Tugwell, one of the most important advisers to President Franklin Roosevelt, acknowledged in a 1968 article in The Center Magazine:

The Constitution was a negative document, meant mostly to protect citizens from their government.... Above all, men were to be free to do as they liked, and since the government was likely to intervene and because prosperity was to be found in the free management of their affairs, a constitution was needed to prevent such intervention.... The laws would maintain order, but would not touch the individual who behaved reasonably.

To the extent that these new social virtues developed [in the New Deal], they were tortured interpretations of a document intended to prevent them. The government did accept responsibility for individuals’ well-being, and it did interfere to make secure. But it really had to be admitted that it was done irregularly and according to doctrines the framers would have rejected. Organization for these purposes was very inefficient because they were not acknowledged intentions. Much of the lagging and reluctance was owed to constantly reiterated intention that what was being done was in pursuit of the aims embodied in the Constitution of 1787, when obviously it was done in contravention of them. [Emphasis mine.]

Now, to be fair, Krugman is not writing about the U.S. Constitution, but instead is claiming that expansion of the tax-funded welfare state enhances freedom. Yet, it also is clear that such "Progressive" notions also clash with the idea of freedom as the Founders of the United States saw it. (My guess is that Krugman would call them "racists" and say whatever they believed is not relevant in the 21st Century.)

As I see it, Krugman's definition of freedom is like saying that a situation in which bullies steal the lunch money of schoolchildren increases freedom because the bullies now are free to spend their other income on whatever they please instead of buying food. Unfortunately, like most "Progressives," Krugman believes that the master-servant relationship of government to the people promotes the Good Society. I look at it and see the expansion of outright slavery.