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Wednesday, July 18, 2018

Reprinted with permission from Shareblue.com

Trump has chosen television host Larry Kudlow to be his new chief economic adviser. Kudlow doesn’t have an economics degree, but he does have a considerable track record of making woefully wrong economic predictions.

But none of that is an obstacle for Trump, who plans to appoint him to head the National Economic Council. Kudlow is another person Trump has taken to after seeing him on television. In fact, when Trump called Kudlow to offer him the job, he made that explicit.

“You’re looking handsome, Larry,” Trump told him after noting he was seeing his picture on TV.

Kudlow will replace Gary Cohn, who resigned after Trump proposed tariffs that will raise the costs of goods for millions of Americans. But as far as economics goes, Kudlow is demonstrably clueless.

Yet thanks to his frequent praise of Trump, he will have his ear as he steers the most important economy on the planet.

Kudlow parlayed his role in the Reagan White House to a job in the financial media, where he has again and again made terrible calls. In the past, Kudlow’s cluelessness was confined to CNBC and the pages of National Review.

But now, thanks to Trump, American taxpayers will subsidize his ignorance. And his bad takes will become part of U.S. economic policy. That is, if he stays in his position long enough to stroke Trump’s ego.

In December of 2007, Kudlow argued that there was no recession coming. He wrote blog posts with titles like “The Recession Debate Is Over,” There Ain’t No Recession,” and “Bush Boom Continues.”

At the time of Kudlow’s posts, the National Bureau of Economic Research said that America had entered the Great Recession, which lasted from December 2007 until June 2009.

It was the worst economic downturn in U.S. history since the Great Depression. The recession triggered a global economic downturn, and U.S. unemployment went as high as 10 percent.

Kudlow’s job as a financial pundit was to assess the state of the economy. But the call he made was disastrously wrong.

The wrongness is a symptom of what Trump appears to like in Kudlow: He is a sycophant. Before Kudlow was raving about Trump, he was raving about George W. Bush. Kudlow didn’t want to see the recession coming because he was writing books about Bush’s supposed economic genius.

As Nobel-prize winning economist Paul Krugman explained, “Trump isn’t looking for good advice, he’s looking for sycophancy, praise for whatever he does. And that’s something Kudlow can certainly provide.”

Kudlow is “reliably wrong about everything,” Krugman noted.

It’s true. He said the Iraq War would produce an economic boom. It didn’t. He insisted that banks that manipulated interest rates to profit at the expense of the public were victims. He actually saidhe was “grateful” that the “human toll” from the Fukushima nuclear meltdown was worse than the “economic toll.”

And when economic conditions improved under President Barack Obama, Kudlow credited the right-wing Tea Party movement. And he called the Obama administration the “federal Taliban.”

Larry Kudlow doesn’t know much about economics. And when he opens his mouth or puts pen to paper, he almost always gets it wrong.

But Trump has seen him on TV, “looking handsome” and saying good things about Trump. And that’s the low standard his administration has for its hiring process.