The Economic Thought of John McCain

To add a bit to what I said the other day about John McCain's apparently tenuous grasp on economic issues, I learn from Mark Schmitt that when the New America Foundation asked campaigns to send an economic advisor to participate in a roundtable discussion, Team McCain sent Kevin "Dow 36,000" Hassett.

Comments

McCain better pray for a big foreign policy event, or he's going to lose Florida and Mitt is going to win the GOP nomination.

Posted by bob | January 25, 2008 11:34 AM

So what?

Posted by ender01 | January 25, 2008 11:43 AM

Hey, "Dow 36,000" is no more ridiculous than Paul "Recession Now!" Krugman. Both will be proven correct eventually.

Posted by Will Allen | January 25, 2008 12:20 PM

Hey, "Dow 36,000" is no more ridiculous than Paul "Recession Now!" Krugman. Both will be proven correct eventually.

So, do you really believe this or are you just being obnoxious?

Posted by mpowell | January 25, 2008 12:43 PM

Will Allen-

There's a fairly simple and very large difference between predicting that an unsustainable bubble will end, and predicting that an unsustainable bubble is sustainable and thus will go on indefinitely. To the extent that recent US performance proves to have depended on unsustainable bubbles in real estate and credit, I'd say that prior predictions of recession will end up looking better, not worse.

As you'll recall, those who had forecasted an end to the tech bubble and the NASDAQ surge were repeatedly "proven wrong" from 1997 through 1999 - and then, were suddenly proven to have been right all along.

Posted by N | January 25, 2008 12:54 PM

My recollection from having read Dow 36,000 (admittedly some time ago) was that the emphasis on the book was less "The Dow is heading immediately to 36,000," and more along the lines of "the appropriate value of the Dow is 36,000, when compared to alternative forms of investment (i.e. bonds), but people's lack of understanding of the market holds down the value." Am I already becoming senile...?

Posted by Jeremiah | January 25, 2008 1:32 PM

Hey, I never read the book, and my reaction to the title was that it would have have been rather more courageous to place a date on the cover. My snarky point was that predicting a recession for years on end, and finally being proven correct, doesn't make one much more wise than predicting Dow 36,000. Democrats like Krugman because he is mostly in agreement with them regarding policy preferences, not becaue he has shown any special acumen as an economic forecaster. That pretty much goes for any economist who becomes heavily involved in politics.

Posted by Will Allen | January 25, 2008 1:56 PM

Yes, N, and being a bear from 2002 to 2007 would have been extraordinarily expensive.

Posted by Will Allen | January 25, 2008 2:00 PM

Brad DeLong on Glassman and Hassett's claims:

http://www.j-bradford-delong.net/movable_type/2005_archives/000025.html

Posted by N | January 25, 2008 2:10 PM

"being a bear from 2002 to 2007 would have been extraordinarily expensive."

Not really - since the dollar has fallen drastically during that time period, investors actually made no money, despite having larger figures in their bank accounts.

Meanwhile, gold breaks $900 and is expected to go to $1,000 soon.

Posted by Richard Steven Hack | January 25, 2008 8:25 PM