Almost four decades have passed since Daniel Patrick Moynihan famously declared, “Of a sudden, the G.O.P. has become a party of ideas.” And his statement still holds true, with one modification: These days, Republicans are a party of zombie ideas — ideas that should have died long ago, yet still keep shambling along, eating politicians’ brains.
The most important of these zombies is the “supply side” insistence that cutting taxes on the rich reliably produces economic miracles, and conversely that raising taxes on the rich is a recipe for disaster. Faith in this doctrine survived the boom that followed Bill Clinton’s tax hikes, the lackluster recovery and eventual catastrophe that followed George W. Bush’s tax cuts, the debacle in Kansas, and more.
And Donald Trump’s selection of Larry Kudlow to head the National Economic Council confirms that the tax-cut zombie is undead and well. For Kudlow is a fervent believer in the infinite virtues of tax cuts, despite a track record of predictions based on that belief that, as New York magazine’s Jonathan Chait once wrote, “has elevated flamboyant wrongness to a form of performance art.”
Yet there is more to economic policy than taxes; Trump himself, while willing to sign whatever tax cuts Congress sends him, seems far more interested in international policy, in particular the supposed evils of trade deficits. And that’s where things get interesting.
