Scott Sumner has a wonderful post, riffing off a post of Paul Krugman’s. In his post Dr. Krugman lists five “largely empirical questions” that he claims divide progressives from conservatives:
- The existence of anthropogenic climate change
- The effects of fiscal stimulus/austerity
- The effects of monetary expansion, and the risks of inflation
- The revenue effects of tax cuts
- The workability of universal health care
Dr. Sumner gives his responses, for which you should read his post.
I consider myself politically center-center. I can provide empirical evidence and some subjective evidence: most conservatives think I’m liberal and most liberals think I’m conservative, as sure a rule of thumb for being a centrist as one could find. Here are my responses:
- I think that anthropogenic climate change is more likely than not but probably not as dire as many of the global warming advocates claim. Like Dr. Sumner I favor a carbon tax, as much for geopolitical reasons as anything else (although that may have a shelf life). I also think that whether I believe or don’t believe doesn’t make much difference as long as the proposals for slowing global warming won’t do much about it anyway, at least not as long as China and India aren’t on board.
- As I’ve said any number of times I think that fiscal stimulus of the proper sort properly timed can produce economic growth during economic downturns. I also think that the Congress is demonstrably incapable of either structuring fiscal stimulus properly or applying it when needed.
- I think that monetary stimulus would be nifty but I’m not sure how it can be accomplished and I think that persistently very low interest rates are having quite serious negative effects on a lot of businesses (e.g. insurance) and individuals. I’m not that worried about inflation but I am worried that it’s pretty hard to control when hyperinflation begins and that most analyses of hyperinflation are, flatly, wrong. I’m also a bit baffled by Dr. Sumner’s prescriptions which sound to me a lot like Harold Hill’s “Think System”.
- I think the revenue effects of tax cuts are unpredictable as a general proposition. There are conditions under which they will reduce revenue; under other conditions they may increase revenue. I think the same is true of tax increases by the way: there is no single answer as to their revenue effects. I’m skeptical that cuts in the income tax today will increase revenues and, as we have seen recently, increases in the personal income tax rate can increase revenues, at least in the short term. I opposed the “Bush tax cuts” for what it’s worth.
- I’m in favor of universal healthcare, think that there are workable and unworkable systems for accomplishing it, that Canada’s and Singapore’s systems are workable, that our system is unworkable and doesn’t produce universal healthcare. I don’t think that any system is workable that doesn’t include systematic controls on spending.