January 12, 2004

A Word of Advice for Greg Mankiw

From this morning's Wall Street Journal:

In the book, Mr. O'Neill, who held senior positions in the White House budget office in the administrations of former presidents Richard Nixon and Gerald Ford before beginning a 23-year business career that took him to the top of Alcoa Inc., describes his conversations with the president as a "monologue" and said the president rarely asked questions in meetings. "The president is like a blind man in a room full of deaf people," he says. "There is no discernible connection." The chairman of the president's Council of Economic Advisers took issue with that assessment. "That's not my experience at all," Gregory Mankiw said on CNN. "The president understands the economy. He comes from a business background."

Greg: It's too late to convince anyone that George W. Bush understands the issues that come before him at the level that a president should. We know that he didn't read Paul O'Neill's or Glenn Hubbard's two-pagers. You know whether or not he reads yours. You're not helping George W. Bush's reputation. And you're harming your own.

Posted by DeLong at January 12, 2004 11:15 AM | TrackBack


Proabably not, except for people who really don't matter (you, me, etc.). And he's cementing his reputation with people who do matter - GOP politicians and their corporate backers.

Posted by: Barry on January 12, 2004 11:23 AM


Barry is right. Mankiw is counting on a nice payback after his "public service" is over.

I mean, respect from your colleagues is nice, but doesn't compare to a fatcat salary and perks in the cushy job that's waiting for him.

Posted by: XYZ on January 12, 2004 11:28 AM


Nice doggie.

Posted by: Alan on January 12, 2004 11:41 AM


My advice to him would be to save every document. That way, if you are pushed out, like O'Neill you can turn over 19,000 pages to a journalist.

Posted by: KevinNYC on January 12, 2004 11:46 AM


My advice to him would be to save every document. That way, if you are pushed out, like O'Neill you can turn over 19,000 pages to a journalist.

Posted by: KevinNYC on January 12, 2004 11:47 AM


Notice he says "Bush is from a business family." Not that Bush is a good businessman. In fact, Bush is a failure at business. His only success is as figure head of the Texas Rangers and the value realized from the sale of his interest only came after the Rangers extorted the local governments to build a new stadium under threat of moving the team. Oh yeah, his other success is trading on inside information at Harken, then having his Daddy the President fix the SEC investigation. I just bought Kevin Phillips' new book, "American Dynasty," about the Bush family. It is interesting. It seems, under Phillips' theory, that the Bush family business acumen is really the Bush-Walker family connections that get sweatheart deals. Mankiew should be made a pariah in the economic community. Basically, he should now be accorded hack status. He can preach to the rapid Republican right at Club For Growth banquets, various party fund raisers and corporate retreats after he leaves public "service," but no University should take him back. He can be like Laffer and create his own Crank Institute of Rightwing Lap Dog Sycophantic Economics.

Posted by: Cal on January 12, 2004 11:52 AM


you'd think the money from the textbook(s) would have been enough to buttress Mankiw's conscience and spine. Did he blow it all on WorldCom or something? This all gets more unbelievable by the day.

Posted by: David on January 12, 2004 11:53 AM



The quote says "from a buisness background, not "from a business family," which undercuts your analysis.

As for Mankiw, another possible explanation is that he believes most, if not all, of what he's saying. Or maybe, he approves of Bush's overall approach, and think going along with the part with which he disagrees is an acceptable price to pay for furthering the larger goal

As I recall, Joe Stiglitz was so furious at the Clinton Administration's handling of various debt crises that he's spent most of his time since then fulminating about it, in lectures and in print. Should he, too, have resigned at the time, and told the American People why?

Finally, why would you believe O'Neill's accounts of any of this?

Posted by: MaidenLane on January 12, 2004 12:39 PM


Glenn Hubbard got one perk from being CEA chair. He got to write some interesting analysis on the alleged benefits of switching to a consumption tax or alternatively not taxing capital income in the Economic Report of the President 2003. Greg Mankiw has written similar arguments but since that chapter was published in the Economic Report of the President 2003, maybe Mankiw gets to write a chapter in the Economic Report of the President 2004 telling us the growth benefits of fiscal restraint. Wait, advocating fiscal restraint was what got O'Neill fired. Never mind.

Posted by: Harold McClure on January 12, 2004 12:57 PM


MaidenLane: Mankiw did not say Bush is a business man; the best he could say is that Bush is from a business family. Edgar Bronfman Jr. is from a business family -- and extraordinary business family, but he is a terrible businessman. Look what he did with Seagram/Dupont. He blew $11 billion in family wealth. Now he wants to pay a premium for a record company which is in an industry undergoing fundamental change and turmoil. Mankiw's comment is meaningless. The author William Burroughs came from a business family, but you could hardly claim that he understands business. Mankiw is a Harvard Professor. He gets no room for slack or weasel words. Would he allow one of his doctoral students -- or undergrads even -- to rely on such shoddy argument? (But hey, maybe Harvard's recent golden days of the 70's and 80's are now gone.) The reason to believe O'Neill's account is that he gave his author 19,000 pages of documents to review. If he made the stuff up, then don't you think that the Bush vampires would have destroyed him in the press already? Notice they don't refute that he had access to documents, only that he didn't get all of the documents. Why don't they just produce the "top secret" memo that says, "you know, that prior memo -- written before September 11, 2001 -- that says look for a reason, any reason to justify invading Iraq and toppling Saddam was just plain wrong. Take those thoughts off the burner. And, by the way, that letter that Cheney, Rumsfeld, Perle, Wolfowitz and the neo-cons wrote and co-signed urging then President Clinton to invade Iraq and topple Saddam, you know, that open letter printed in the Press as a grandstanding ploy, well, that simply was a grandstanding ploy and each and every man and woman who signed it now rescinds that recommendation. We don't think it should by policy." Where's that memo? Why hasn't it been produced? O'Neill was made to be a fool and fed to the press as raw meat. True, he shouldn't have been Treasury Secretary in the first place, but he is now getting his revenge. Finally, in response to the question, "aren't you worried about what the Bush Administration will do to you for speaking out," O'Neill replied: "what can they do to me? I'm old and I'm rich." He's rich. That's all the matters when it comes to the press and most Republicans. If you are rich you must be right. I'm only applying their own logic to O'Neill. To paraphrase the President, O'Neill "hit the trifecta" for Republican respectability: he's a man, he's a successful businessman and he's rich. Therefore, MaidenLane, he must be believed.

Posted by: Cal on January 12, 2004 01:21 PM


Another point for O'Neill's characterization is something that James Fallows notes in his new The Atlantic Monthly piece on the Iraq invasion and occupation, "Blind into Baghdad." In his conversations with Administration officials, no one ever said, "The President thinks that..." or "The President feels strongly that" or "The President directed that." (Neither was Rice mentioned.) It was all, "Cheney said" or "Rumsfeld decided." Fallows says this ran against his experience with any--any--other Administration. He inferred that Bush decides only the very, very, very largest policy goals, and then chooses from policy options presented by his subordinates (and I infer vetted by Cheney, first, who is acting effectively as Chief of Staff).

My further inference is that Bush doesn't have the curiousity or skepticism or humility, perhaps, to seek independent counsel, a failing that is critical given his lack of administrative experience, nor does he interest himself with the second- or third-generation effects of a policy decision. Government as faith-based enterprise.

Posted by: Brian C.B. on January 12, 2004 01:28 PM


BTW, Maidenlane, the reason we can basically believe O'Neill is that the administration isn't denying any factual claims he has made. They're investigating how he got the documents and they're dumping on his reputation, but they aren't denying the substance....

Posted by: howard on January 12, 2004 02:41 PM


BDL wrote of Mankiw, "You're not helping George W. Bush's reputation. And you're harming your own."

What reputation was that? Notwithstanding academic credentials, he seemed like kind of a right-wing hack *before* he joined the Bush Administration.

Posted by: Stephen J Fromm on January 12, 2004 03:58 PM


Bush's "business background" consisted of him saying "My father is George Bush. Give me money."

It was quite effective, as business plans go, but I wouldn't call it the most optimal preparation for the Presidency.

Posted by: Thlayli on January 12, 2004 05:49 PM


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