In which I wholeheartedly support Simon Johnson’s call for Obama to nominate Nobel-winning economist Paul Krugman to the Office of Management and Budget:
The president should nominate Paul Krugman to replace Peter Orszag as director of the Office of Management and Budget. We have previously reviewed Krugman’s outstanding qualifications for this (or any other top level) job (link to details). The main reason Krugman himself has been reluctant in the past relates to a potentially difficult Senate confirmation hearing – for example, if Krugman had been put forward to replace Ben Bernanke.
But for the OMB position, the dynamic of a hearing would be terrific for the president’s specific agenda and broader messages. Krugman, of course, is the leading advocate for continued (or increased) fiscal stimulus. This is exactly President Obama’s message to the G20 this weekend.
Plus, when Republicans push back against Krugman on this issue, he will let them have it full blast on fiscal policy during the Bush administration. Krugman has, again and again, been an outspoken critic of the Bush era fiscal policy. He has precise chapter and verse on where the Bush team went off the deep fiscal edge.
I think this is a fantastic proposal for three reasons. Consider the benefits: 1) Krugman gets the chance to prove once and for all that Neo-Keynesian economics does not work even when its foremost champion is in a position of power. 2) He will no longer be writing ridiculous opinion columns. 3) Within 18 months, the rest of the world will be forced to acknowledge that Krugman is a maleducated ignoramus who knows virtually nothing about relevant economic theory. 4) Mainstream economics can finally move on from an outdated and destructive economic theory.
And there’s no downside. It’s not as if Obama is going to appoint anyone who understands the first thing about the present contractionary crisis, after all. Krugman can’t possibly make things any worse than whatever clueless hack ends up getting appointed; for all Krugman’s willful theoretical incompetence, he’s actually less cretinous than the average mainstream economist.