September 30, 2001The Hitchhiker SyndromeBy PAUL KRUGMANhey started arriving
literally before the dust had settled. The Washington Post The most vocal hitchhikers are conservative pundits, who within a day of the terrorist attack were urging the administration to use the occasion to ram through tax cuts for the wealthy and large corporations, drilling in the Arctic and so on. This drive reached a sort of climax in the already notorious Wall Street Journal editorial of Sept. 19, which added appointments of conservative judges to the list of goodies the administration should grab while the grabbing is good. Some politicians took heed. Representative Bill Thomas, chairman of the Ways and Means Committee, rushed to prepare legislation cutting the capital gains tax; he was ready to put that legislation in play just days after the terrorists struck but was somehow dissuaded. And a good thing, too: that tax cut was a terrible idea, which would have done little to stimulate the economy, would have greatly worsened the long-run budget prospect and would have given the lion's share of its benefits to a tiny, wealthy, minority. As I said, the Bush administration has been pretty good so far about rejecting the hitchhiker strategy; sadly, the official who was least restrained was the one with the best policy proposal. Robert Zoellick, the United States trade representative, did himself and the nation no favor when he appeared to demand "fast track" negotiating authority on the grounds that it was part of a counteroffensive against terrorism. It so happens that free trade is one issue on which the administration is mostly right and many Democrats are wrong. That does not excuse Mr. Zoellick's exploitation of a national crisis. Indeed, he has made it that much harder for well-intentioned free traders to defend their position, now that their cause has been tainted by his opportunism. The big question ・in its way as big a question as what military action the U.S. will eventually take in Afghanistan or elsewhere ・is whether politicians of both parties (for there are liberal hitchhikers too) will understand that in times like these the national good requires a special effort to avoid not just the reality, but even the appearance of political profiteering. On economic policy the signals are mixed. Capital gains tax cuts have, it seems, slipped off the agenda. But some administration officials continue to push for a cut in corporate profits taxes, an almost equally bad idea that shares the same defects: it would contribute little to the economy in the short run, would seriously hurt the long-run budget picture (the most widely circulated proposal would, according to the Center on Budget and Policy Priorities, cost $900 billion over the next 10 years) and would deliver its benefits mainly to the wealthiest families. Worse yet, such a tax cut would look remarkably like a political payoff. Last spring the administration urged corporate lobbyists to mute their voices while the original tax cut proposal was forced through Congress; their interests, they were quietly promised, would be attended to later. Then it became clear that the tax cut was every bit as much of a budget-buster as the critics had warned, and the lobbyists found that their moment had passed. To give them what they want now would give every appearance of using a national emergency to reward political allies; that in itself would be a reason not to cut corporate taxes, even if the proposal were not such a bad idea. Last week the White House spokesman, Ari Fleischer, warned that in times like these people "need to watch what they say, watch what they do." (It did not help Mr. Fleischer's eroding credibility that the official transcript of the briefing mysteriously omitted the ominous first half of his remark.) The comment, aimed at "all Americans," was highly inappropriate. But a similar comment aimed at his own colleagues would be entirely appropriate. In the aftermath of the outrage of Sept. 11 the administration has extraordinary freedom of action. But freedom, as always, comes with responsibility. Those whom we trust to look after the national interest must watch what they say and do, lest it seem that the nation's trust has been abused. |