The Presidential Medal of Freedom is supposed to be a unique American honor. Today, its value will be diminished when Donald Trump awards it to Art Laffer.
Laffer helped popularize the notion that tax cuts pay for themselves through faster economic growth. It almost never works out in practice. But Laffer and his namesake curve remain darlings of Republican politicians.
On Wednesday, Laffer will receive the Presidential Medal of Freedom – the nation’s highest civilian honor – from President Trump.
You’ll probably see reports today that describe Laffer as the “godfather” of supply-side economics, though that isn’t quite right. Others promoted the idea that tax cuts pay for themselves before him, but Laffer famously sketched out the idea on a cocktail napkin for Dick Cheney in 1974, and soon after, the “Laffer Curve” was born.
The nation’s finances have never been the same.
As Slate’s Jordan Weissmann recently put it, “There may be no man alive who has done more damage to America’s understanding of economics than Art Laffer. So, of course, Donald Trump is now awarding him the Presidential Medal of Freedom.”
Laffer spent much of the spring peddling the idea that the Great Recession, which began in December 2007, should be blamed on President Barack Obama, who took office in January 2009. (He also predicted a decade ago that Obama’s plan would “destroy the economy.” Instead, it rescued the country from the Great Recession and initiated a recovery that’s still ongoing.)
More recently, as regular readers may recall, Laffer served as the architect of then-Gov. Sam Brownback’s (R) failed right-wing economic experiment in Kansas, which destroyed state finances and did little to improve the state’s economy. Laffer vowed that Brownback’s plan would generate “enormous prosperity,” which is largely the opposite of what actually happened.
When the GOP governor’s agenda failed to deliver on any of the expected results, Laffer was pressed for an explanation. “Kansas is doing fine,” he boasted.
In 2015, Paul Krugman added some helpful context to Laffer’s record.
Since the 1970s there have been four big changes in the effective tax rate on the top 1 percent: the Reagan cut, the Clinton hike, the Bush cut, and the Obama hike. Republicans are fixated on the boom that followed the 1981 tax cut (which had much more to do with monetary policy, but never mind). But they predicted dire effects from the Clinton hike; instead we had a boom that eclipsed Reagan’s. They predicted wonderful things from the Bush tax cuts; instead we got an unimpressive expansion followed by a devastating crash. And they predicted terrible things from the tax rise after Obama’s reelection; instead we got the best job growth since 1999.
And when I say “they predicted”, I especially mean Laffer himself, who has a truly extraordinary record of being wrong at crucial turning points. As Bruce Bartlett pointed out a few years ago, Laffer was even wrong during the Reagan years: he predicted that the Reagan tax hikes of 1982, which partially reversed earlier cuts, would cripple the economy; “morning in America” promptly followed.
With a record like this, common sense suggests Laffer should be seen as a national laughingstock. Instead, as Republican politics has become radicalized – and divorced altogether from reason and evidence – GOP candidates and officeholders have sought out Laffer for his “expertise.”
And today, none other than Donald J. Trump will put our country’s highest civilian honor around Laffer’s neck.