Jeff Sachs has long been known as the celebrity-hobnobbing economist with the seriously flawed “shock therapy” plan for economic development. Lately he’s taken a weird turn in the public debate, coauthoring an op-ed piece with Joe Scarborough of all people, attacking Paul Krugman.
Today he’s back with one of the most bizarre pieces of economic analysis I’ve seen, arguing among other things that 1) the stimulus was too focused on short-term stuff like tax cuts which 2) aren’t effective stimulus anyway (huh?) and 3) should have had much more long-term investment. Listen to him complain about the last one:
Examples of long-term federal investment programs include the national highway system, the moon program, and the human genome project. A massive renewable energy program – R&D, renewable power generation, new transmission grid, urban smart grids, and related infrastructure (e.g. for electric vehicles) – is an example of what is needed over the course of a decade. It might have been feasible in 2009 when Obama had the upper hand and the momentum. It is, alas, very unlikely today.
The Administration should indeed have taken several months in 2009 to design and advocate for long-term investment programs for renewable energy, fast intercity rail, large-scale highway upgrading, large-scale skill and job training, and so forth, rather than rushing to pass a stimulus package of hundreds of billions of dollars of shortsighted and largely ineffective temporary tax cuts and transfer programs.
Nutty aggregate demand issues aside, this is simply ignoring the plain facts. The stimulus did have money for renewable energy ($90 billion in fact), upgrading our rail network, and highway maintenance. A book has been written about this very topic, large sections of which is devoted to lamenting the fact that lazy, irresponsible pundits and reporters then and now keep complaining that the stimulus didn’t have things it in fact had.
Peggy Noonan got hammered for complaining Obama hadn’t done infrastructure spending he had in fact done, but no one was surprised because it’s Peggy Noonan and she’s basically your crazy aunt. But Jeff Sachs is supposed to be a professional economist. He may have laid waste to Russia, but I would have thought he could at least bother to read a summary of such a huge bill before holding forth.