Giuliani and the Laffer Curve

Giuliani's pro-Laffer musings are, of course, reprehensible, if not surprising. I'd bet large sums of money that Giuliani himself doesn't believe that it's merely a "liberal Democratic assumption that if you raise taxes, you raise more money," but like with his health care plan, is just adopting positions for their utility in attacking Democrats, rather than their integrity as policy plans.

This is only a viable approach for him because he's smartly manipulating two dynamics. The first is that the press won't call him on it. Read Matt's round-up of the uncritical stenography accorded to Giuliani's comments. If every time Giuliani uttered this bit of economic absurdity, the reporter appended a comment explaining that most economists consider this a laughable bit of hackish quackery, he'd stop saying it. They don't, so he doesn't. Which enables his whole campaign strategy: In the current media environment, all policy proposals are created equal. If you have something that sounds like a plan, you're allowed into the conversation as if you have a plan. Therefore, there's really no incentive to craft your policy proposals for maximum coherence and wisdom rather than maximum political advantage.

Giuliani's second enabler is the cowardice of his fellow candidates. These comments on the Laffer curve came at a GOP presidential debate. Anyone on the stage could've smacked him down. And one of the most visible of the participants, Mitt Romney, has hired Gregory Mankiw as one of his two primary economic advisors. That would be the same Gregory Mankiw who responded to pro-Laffer curve comments by McCain with a weary "unfortunately, fealty to the most extreme supply-side views is de rigeur in some segments of the Republican party." But his candidate, who surely knows better or Mankiw isn't doing his job, said nothing to contradict Giuliani. Not a word. One wonders why Professor Mankiw is lending his credibility to an individual so willing to abet the propagation of "extreme" views.

So you tell me: Why should Giuliani be honest? What's in it for him?