Someone emailed me this Will Wilkinson post which I find interesting because his description of what progressives think about the economy has basically zero points of contact with what I think about the economy. It’s especially interesting, because the post starts by glossing Atlas Shrugged‘s take on where economic progress comes from (quantum leaps of brilliant innovation) and then explaining that that’s wrong and that it really comes from “an accumulation of tiny productivity-enhancing innovations.” Now I have no idea whether or not anyone on the left agrees with the Atlas Shrugged heroic vision, but certainly I don’t, whereas I’m quite certain that lots of people on the right agree with it. That’s part of the reason you have all these congressman and libertarian bloggers saying nice things about Atlas Shrugged.
But what I think progressives think about economic growth—certainly what I think about economic growth—is that a country in the circumstances facing the United States has more to gain from investments in infrastructure, education, health, and amelioration of the conditions of the most deprived than it does from low tax rates. I also think that it’s sometimes necessary to take a short-term hit to growth in order to ward off an ecological catastrophe, and that there are some worthwhile non-commercial goods whose creation and dissemination has an impact on welfare that’s not captured in GDP statistics.
The idea that “Obama and his devotees are Bizarro World Randian romantics in the grip of an adolescent faith in the generative powers of the state” seems simply outlandish to me. Does Will think this describes Larry Summers? Jared Bernstein? Really? I think if there’s romanticism in Obama’s rhetoric that’s because speechwriters prefer romantic language. The state doesn’t have magic generative powers, but there are certain kinds of worthwhile goods that are better provided by the state. The political right has been extremely powerful in the United States for the past thirty years which has left us relatively underinvested in those goods. If I was really seduced by fantasies about the generative powers of the state, I’d be recommending an expanded public sector for France too. But they’re in a different situation. Their health care is great and they’ve got plenty of high-speed rail. They could probably use some tax cuts and deregulation.