Nate suggests that the Obama team may be playing ‘Price is Right’ where you bid just under the top price, in order to win the game (and get the Democrats to push for higher spending and less business taxes, while maintaining Republican support for a good-size package):

“What does this mean? It means [Obama] wants the Senate Democrats to do his dirty work for him. All of the sudden, the administration, which is about to spend at least $800 billion, gets to play the role of the fiscally prudent tightwads, negotiating against the Senate Democrats. This has at least two benefits. One, it requires less of the administration’s political capital to sell the package. And two, it completely co-opts the conservative opposition.

“Unless you’re Paul Krugman or Greg Mankiw, you probably don’t really have any idea whether $300 billion or $800 billion or $1.2 trillion is the right amount to spend; the numbers are too large, the scope of the stimulus too unprecedented, to provide for any absolute frame of reference. So the frame of reference is relative rather than absolute.

“If you’re Mitch McConnell or Mary Landireu or Bob Corker and you see that John Kerry thinks that $800 billion is too little — well then, ‘gal darn it, this Obama fella must be doing something right.”

Nate suggests that the Obama team may be playing ‘Price is Right’ where you bid just under the top price, in order to win the game (and get the Democrats to push for higher spending and less business taxes, while maintaining Republican support for a good-size package):

“What does this mean? It means [Obama] wants the Senate Democrats to do his dirty work for him. All of the sudden, the administration, which is about to spend at least $800 billion, gets to play the role of the fiscally prudent tightwads, negotiating against the Senate Democrats. This has at least two benefits. One, it requires less of the administration’s political capital to sell the package. And two, it completely co-opts the conservative opposition.

“Unless you’re Paul Krugman or Greg Mankiw, you probably don’t really have any idea whether $300 billion or $800 billion or $1.2 trillion is the right amount to spend; the numbers are too large, the scope of the stimulus too unprecedented, to provide for any absolute frame of reference. So the frame of reference is relative rather than absolute.

“If you’re Mitch McConnell or Mary Landireu or Bob Corker and you see that John Kerry thinks that $800 billion is too little — well then, ‘gal darn it, this Obama fella must be doing something right.”

As long as we’re mired in 1930′s analogies with all this talk of “new” New Deals and all, it’s worth remembering that one common result of economic distress has been nationalist tribalism. You can’t rely on populism to aim properly — after all Bush played populist pretty successfully for quite a while, notwithstanding the “white tie” elite reality of his policies.

Tin-foil hatters on the right may tell each other tall tales about the black helicopters and such, and it’s fine to chuckle over that stuff. But the Davos-frequenting international capitalist elite really do exist, really do identify with one another more strongly than with their own more humble fellow citizens, and really do enjoy extraordinary freedom to ignore the public weal. I’m pretty sure they aren’t operating a deliberate global conspiracy run from the tri-lateral commission or whatever, but the backlash against free-trade, ‘amnesty’ for undocumented immigrants, or ‘SPP/NAU’ is close cousin to our own anger over Wall Street scammers and multi-megabuck CEO ‘compensation’, etc. We just keep our anger directed upward at the greedheads instead of being diverted into rants against impoverished immigrants.

Expect Republicans to turn up the heat on these “blame the little guy” tactics. We need to be prepared with a better thought-out populism before that wave of negativity builds up too much higher. That’s why ‘NAU’ talk bears watching. We need to offer a better diagnosis of what Stiglitz calls Globalization and its Discontents“.

BTW, I wonder how consciously Stiglitz chose to echo Freud’s 1930 title: Civilization and its Discontents. The German title of that book comes closer to what worries me these days: Das Unbehagen in der Kultur (“The Uneasiness in Culture”). Shades of “Interregnum” there

As long as we’re mired in 1930′s analogies with all this talk of “new” New Deals and all, it’s worth remembering that one common result of economic distress has been nationalist tribalism. You can’t rely on populism to aim properly — after all Bush played populist pretty successfully for quite a while, notwithstanding the “white tie” elite reality of his policies.

Tin-foil hatters on the right may tell each other tall tales about the black helicopters and such, and it’s fine to chuckle over that stuff. But the Davos-frequenting international capitalist elite really do exist, really do identify with one another more strongly than with their own more humble fellow citizens, and really do enjoy extraordinary freedom to ignore the public weal. I’m pretty sure they aren’t operating a deliberate global conspiracy run from the tri-lateral commission or whatever, but the backlash against free-trade, ‘amnesty’ for undocumented immigrants, or ‘SPP/NAU’ is close cousin to our own anger over Wall Street scammers and multi-megabuck CEO ‘compensation’, etc. We just keep our anger directed upward at the greedheads instead of being diverted into rants against impoverished immigrants.

Expect Republicans to turn up the heat on these “blame the little guy” tactics. We need to be prepared with a better thought-out populism before that wave of negativity builds up too much higher. That’s why ‘NAU’ talk bears watching. We need to offer a better diagnosis of what Stiglitz calls Globalization and its Discontents“.

BTW, I wonder how consciously Stiglitz chose to echo Freud’s 1930 title: Civilization and its Discontents. The German title of that book comes closer to what worries me these days: Das Unbehagen in der Kultur (“The Uneasiness in Culture”). Shades of “Interregnum” there