That seems to be the story, based on what Veronique de Rugy has written at National Review Online. Calling for tax increases in an economic downturn doesn’t make any sense, even under Keynesian theories. So why do so many Keynesians seem to be supporting the idea of allowing tax increases for those earning more than $250,000 a year?
Reason Magazine expanded on this question on their blog. They argue that this trend reveals more about neo-Keynesians like Paul Krugman than it does about the actual accomplishments or shortcomings of John Maynard Keynes.
A couple weeks ago I wrote about how envy and resentment led to bad law when it came to foreign banking. Unfortunately, it appears President Obama and his surrogates are attempting to use a political debate to capture the sentiment of envy for political gains.
Perhaps I’m being too cynical. Yet I cannot think of an economic principle that would lead one to believe that removing money from the private sector makes sense given the fragile state our economy is in. After all, J.M. Keynes argued explicitly in favor of the government running deficits.
Is the President so desperate to score political points and hold onto his power that he would advocate for policies that seem to go against his underlying economic school of thought? I can’t think of a much better example to reinforce Lord Acton’s most famous proviso that power corrupts.