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“Crazy About Money”: Cruz’s Obsession With Gold Would Do Even More Economic Damage Than Trump

In this year of Trump, the land is loud with the wails of political commentators, rending their garments and crying out, “How can this be happening?” But a few brave souls are willing to whisper the awful truth: Many voters support Donald Trump because they actually agree with his ideas.

This is not, however, a column about Mr. Trump. It is, instead, about Ted Cruz, who has emerged as the favored candidate of the G.O.P. elite now that less disagreeable alternatives have imploded.

In a way, that’s quite a remarkable development. For Mr. Cruz has staked out positions on crucial issues that are, not to put too fine a point on it, crazy. How can elite Republicans back him?

The answer is the same for Mr. Cruz and the elites as it is for Mr. Trump and the base: Leading Republicans support Mr. Cruz, not despite his policy positions, but because of them. They may not like his style, but they agree with his substance.

This is true, for example, when it comes to Mr. Cruz’s belligerent stance on foreign policy. Establishment Republicans may wince at the candidate’s fondness for talking about “carpet bombing” or his choice of a noted anti-Muslim bigot and conspiracy theorist as an adviser.

But both Jeb Bush and Marco Rubio chose foreign policy teams dominated by the very people who pushed America into the Iraq debacle, and learned nothing from the experience. I know I wasn’t the only observer who looked at those rosters and thought, “They will, in fact, be greeted as liberators.”

And then there’s a subject dear to my heart: monetary policy. You might be surprised to learn that few of the subjects I write on inspire as much passion — or as much hate mail. And it’s a subject on which Mr. Cruz has staked out a distinctive position, by calling for a return to the gold standard.

This is, in case you’re wondering, very much a fringe position among economists. When members of a large bipartisan panel on economic policy, run by the University of Chicago business school, were asked whether a gold standard would be an improvement on current arrangements, not one said yes.

In fact, many economists believe that a destructive focus on gold played a major role in the spread of the Great Depression. And Mr. Cruz’s obsession with gold is one reason to believe that he would do even more economic damage in the White House than Mr. Trump would.

So how can elite Republicans — people who have denounced Mr. Trump in part because they claim that he advocates terrible economic policies — be supporting a candidate with such fringe views? The answer is that many of them are also out there on the fringe.

This wasn’t always true. As recently as 2004, Bush administration economists lauded the very kind of policy activism a return to the gold standard is supposed to prevent, declaring that “aggressive monetary policy can help make a recession shorter and milder.” But today’s leading Republicans, living in their own closed intellectual universe, are a very different breed.

Take, as a not at all arbitrary example, Paul Ryan, the speaker of the House and arguably the de facto leader of the Republican establishment.

As I have pointed out on a number of occasions, Mr. Ryan is fundamentally a con man on his signature issue, fiscal policy. Incidentally, for what it’s worth, Mr. Cruz has been relatively honest by his party’s standards on this issue, openly declaring his intention to raise taxes that hit the poor and the middle class even as he slashes them on the rich.

But Mr. Ryan seems to be a true believer on monetary policy — the kind of true believer whose faith cannot be shaken by contrary evidence. It’s now five years since he accused Ben Bernanke of pursuing inflationary policies that would “debase” the dollar; if the rising dollar and slumping inflation that followed has ever given him pause, he has shown no sign of it.

But what, exactly, is the nature of his monetary faith? The same as the nature of Mr. Cruz’s beliefs: Both men are devotees of Ayn Rand, even if Mr. Ryan now tries to downplay his well-documented Rand fandom.

At one point Mr. Ryan got quite specific about his intellectual roots, declaring that he always goes back to “Francisco d’Anconia’s speech on money” — one of the interminable monologues in Rand’s “Atlas Shrugged” — “when I think about monetary policy.” And that speech is a paean to the gold standard and a denunciation of money-printing as immoral.

The moral here is that we shouldn’t be surprised by the Republican establishment’s willingness to rally behind Mr. Cruz. Yes, Mr. Cruz portrays himself as an outsider, and has managed to make remarkably many personal enemies. But while his policy ideas are extreme, they reflect the same extremism that pervades the party’s elite.

There are no moderates, or for that matter, sensible people, anywhere in this story.

 

By: Paul Krugman, Op-Ed Contributor, The New York Times, March 25, 2016

March 25, 2016 Posted by | Donald Trump, Establishment Republicans, Monetary Policy, Ted Cruz | , , , , , | Leave a comment

“Aiding The Rise Of Donald Trump”: Rubio Is Gone, But The Damage He Caused Remains

Tuesday night Donald Trump’s main ally in the Republican primary campaign, Sen. Marco Rubio, finally called it quits. He was praised by many Republican pundits, as he typically is, for some of the aspirational language he used in his non-victory speech, though most of those pundits shied away from a fair assessment of Rubio’s behavior during this presidential campaign season.

Here is such an assessment: Rubio ran on a promise of being the candidate of the future with a bold, optimistic platform, but he never delivered on that promise. In the process, he did perhaps irreparable harm to his party and to the country.

First, he ended the campaign season with a platform that can only be characterized as far-right. Sure, Rubio started his campaign with a number of extreme views – for example, he wanted the state to force rape victims to give birth to the child of their rapists and incest victims to give birth to the child of their fathers, while plotting to forcefully disband hundreds of thousands of same-sex marriages.

But it was only a year ago that the senator proposed a tax plan, with Sen. Mike Lee of Utah, that would raise taxes on millions of people in the middle class. By now, his proclaimed tax reform preference involves raising the debt-to-GDP ratio to 150 percent, while lowering Warren Buffett’s tax rate to zero. And that’s not all: He has also gone from supporting amnesty to wanting to deport children who have spent practically their entire life in the U.S., as well as supporting the deportation of the parents of U.S. citizens. In addition, he has proposed closing down not just mosques but also cafes and the like where Muslims may gather.

Now, some of Rubio’s supporters will claim that he does not actually believe in those things and he was just trying to out-Trump Trump, but by endorsing them he made them more respectable.

Second, he has done more than perhaps anyone but Trump to coarsen public debate. It was Rubio, after all, who introduced – and I can’t believe I’m writing this – discussions of penis size to the presidential race.

Third, he has done more than perhaps even Jeb Bush and his donors to help Trump win the Republican nomination in simple delegate terms.

Instead of dropping out after losing in Iowa, New Hampshire, South Carolina and Nevada (where he used to live!), Rubio set a target of losing the first 25 or so states. He roughly succeeded in losing those states, but in the process he helped Trump amass a significant delegate lead over his most serious opponent, Sen. Ted Cruz. He did this not only by winning delegates himself here and there, but perhaps most harmfully in states like Idaho and Texas by denying Cruz outright majorities that would have made those states winner-take-all. In those two states alone, Trump added 120 delegates to his lead. It is extremely likely that without Rubio, Cruz would have been the Republican front-runner going into this week, thereby fundamentally transforming the dynamics of the race.

Perhaps the senator will yet redeem himself. His almost-tearful press conference this weekend indicated that he might try – but for now, the damage he has done is tremendous.

 

By: Stan Veuger, Thomas Jefferson Street Blog, U. S. News and World Report, March 16, 2016

March 18, 2016 Posted by | Donald Trump, GOP, Marco Rubio | , , , , , , , | 4 Comments

   

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