Lost Prophets / Facing Up
Malabre, Alfred A. Jr. & Peterson, Peter G.
but she became even more zealous than he in preventing Douglass from learning to read, forcing him to resort to all sorts of ruses to further his self-education. "Slavery," he wrote, "soon proved...
...Products of secular and material civilization, we are apt to condemn slavery mainly on the grounds of its physical cruelties and material deprivations...
...The only problem, Peterson says, is that Clinton did not go far enough...
...Deep, long recessions, economic history shows, tend to be followed by relatively long expansions...
...This is Malabre's sixth book and, as his successful journalistic career is nearing its end, it contains valedictory elements and sundry reminiscences (though his accounts of economic seminars attended in • Bermuda and New Hampshire prove less compelling than, say, Peter Arnett's recollections from the battlefields of Vietnam...
...Peterson's first chapter ("What My Father Knew About Economics") explains what he's about...
...The two wrote the foreword to this volume...
...This illustrates another great theme of Douglass's: slavery's adverse impact on white slave-holders...
...A man without force," he observed, "is without the essential dignity of humanity...
...Peterson served as Richard Nixon's secretary of commerce and refers to himself as a "Republican fat cat...
...It is a point of view—call it Christian realism—that is conspicuous in modern political discourse mainly by its absence...
...Harvard Business School Press/256 pages /$27.95 FACING UP: HOW TO RESCUE THE ECONOMY FROM CRUSHING DEBT AND RESTORE THE AMERICAN DREAM Peter G. Peterson Simon & Schuster/411 pages /$22 reviewed by ROBERT D. NOVAK 70 The American Spectator April/May 1994 stream, journalistically and politically...
...T he antidote to this misguided self- flagellation can be found in Wanniski's supply-side primer, The Way the World Works (available from Polyconomics, Inc...
...During the Reagan and Bush years, he writes, "I felt increasingly like a Republican abandoned by his party...
...The dogmas of Al Malabre and Pete Peterson—that lower taxes mean stagnation and higher taxes mean growth—are more and more accepted without serious challenge...
...10 The American Spectator April/May 1994 71...
...the material comforts it (falsely) promises...
...M alabre's performance is truly amazing...
...T oday, we take the evil of slavery so much for granted that the full force of Douglass's argument can easily elude us...
...Yet there is verbal cordite in the air when Malabre tries to settle scores with Wall Street Journal editor Robert Bartley, who dominates the paper's editorial policy...
...Wholesale rejection of supply-side economics has spread, thanks to a massaging of statistics to which these two works make a regrettable contribution...
...Through the centuries, this notion of austerity imposed by the governing elites for the benefit of the governed has always caused misery for everyone but the governing elites themselves...
...Today, he warns, "most Americans—emphatically including the middle class—will have to give something up, at least temporarily, to get back our American Dream...
...in Morristown, New Jersey...
...In Lost Prophets, Malabre also rejects Keynesianism and even his once-beloved monetarism...
...Nor does this pair find fault with the Clinton tax increases...
...Johnson succumbed to pressure in January 1967, and proposed a 6 percent surcharge, described by Malabre as LBJ's "new conservatism...
...In Facing Up, Peterson refers to Reagan policy as a Robert D. Novak is a nationally syndicated columnist, television commentator, and editor of the Evans and Novak Political Report...
...A man's character greatly takes its hue and shape from the form and color of things about him...
...Both Malabre and Peterson take Lyndon Johnson to task for not immediately imposing a special tax to finance the Vietnam war...
...In fact, a better case could be made for the opposite...
...After "the world's greatest experiment in debt-financed economic stimulus," he contends, "we find ourselves boxed into a corner from which there are no pleasant exits...
...As Douglass put it in his second autobiography, Bondage and Freedom, (which largely amplified and expanded on the incidents described in the Narrative), "The slaveholder, as well as the slave, is the victim of the slave system...
...His economic thinking began to take shape w len his father refused to take the Uniun Pacific streamliner to Colorado for the family's biennial vacation, because it would cost too much...
...The nonsense that we could put our fiscal house in order without raising new taxes was finally laid to rest...
...Slavery," he wrote, "soon proved its ability to divest her of her excellent qualities, and her home of its early happiness...
...It derived from the Eisenhower administration's "legacy of fiscal restraint," Malabre argues...
...Those who made the supply-side revolution—Bartley, Wanniski, Jack Kemp, Arthur Laffer, Paul Craig Roberts, Jeff Bell—are a band of brothers no more...
...and even this it cannot do long, if the signs of power do not arise...
...Human nature is so constituted that it cannot honor a helpless man, although it can pity him...
...Slow to develop, the painful consequences of supply-side economics as practiced in the Reagan years have been slow to recede—as the one-term presidency of George Bush attests...
...There are also autobiographical elements...
...While both are thus in a sense outsiders, in the larger picture Malabre and Peterson are squarely in the liberal mainLOST PROPHETS: AN INSIDER'S HISTORY OF MODERN ECONOMISTS Alfred A. Malabre, Jr...
...CI "mad drunken bash" driven by the "nonsense that we could put our fiscal house in order without raising new taxes...
...It is a lesson we seem doomed to relearn painfully...
...The fundamental impulse of the Reagan administration to relax tax burdens, Malabre writes in Lost Prophets, was "nonsense of the worst sort...
...Alfred L. Malabre, Jr., economics editor of the Wall Street Journal, and Peter G. Peterson, Wall Street financier, add to the confusion with books that accomplish an astonishing rewrite of recent American economic history...
...Under the whole heavens, there is no relationship more unfavorable to thedevelopment of honorable character, than that sustained by the slave-holder to the slave...
...From early childhood to his dying day, he saw slavery primarily as a spiritual evil—"the fatal poison of irresponsible power"—that wreaks havoc (though in different ways) on black and white alike...
...He grew up in Kearney, Nebraska, where his Greek immigrant father, George Petropoulos,was proprietor of a 24-hour, 365-day diner...
...Further validation of Wanniski's theories is presented by Bartley's The Seven Fat Years, an effective 1992 explanation of exactly how supply-side economics brought about prosperity under Ronald Reagan...
...get, writes Peterson, "shattered some paralyzing dogma of the Reagan-Bush years...
...T here's more to these two economic tomes than the mere defense of higher taxes and attacks on supply-side economics...
...That is, this self-described "fat cat" is anxious to impose his father's philosophy on the rest of us...
...Similarly, Malabre claims that what he calls "the long 1982-1990 expansion" was brought about not by the Reagan tax cuts "but through the simple evolution of the business cycle...
...Instead," Peterson writes, "on the hot, dry, 110-degree plains of Nebraska, seven of us—assorted relatives included—[would] pile into the DeSoto for the 12-hour rattling crawl to Colorado...
...provided food for peoples' bellies evenas it shackled their minds and spirits...
...But what of the record 106-month economic expansion of the 1960s...
...That is a monstrous new tax load to stand up against the one supply-side agenda item embraced by Peterson: indexation of capital gains rates, which, on his list of twenty-four "reforms," ranks twenty-fourth...
...His book relies heavily on charts, many of them in living color, which provide a road map for the austere journey he and his bipartisan Concord Coalition partners, former senators Paul Tsongas and Warren Rudman, have prescribed for America...
...Not satisfied to trash Reaganomics, he also assails the Kennedy-Johnson tax cuts, which supply-siders have celebrated, and blames them for the stagflation that followed a decade later...
...The Clinton bud...
...Before you mistake these two books for leftovers from the 1992 Clinton campaign, consider: Malabre clearly regards himself as a conservative and once was a leading journalistic advocate of Milton Friedman's monetarist school...
...Malabre accuses Bartley of falling under the sinister influence of Jude Wanniski, then his lieutenant on the editorial page, in promoting the supply-side agenda and selling it to the world...
...Only years later," Peterson writes, did he realize that his father was "looking ahead to the future" by not taking the train...
...But is anyone still preaching from these texts...
...That is why the argument that not all slaves were beaten and chained, that some had relatively decent masters and were actually better off, materially, than poor whites, made no impact on him...
...No politician has taken up the role Kemp played in the late seventies of standing up to the rhetoric of "sacrifice"—not even Kemp...
...For Douglass, man is first and foremost a spiritual being, and any system that sets out to undermine his spirituality deserves to be destroyed, regardless of T he conventional wisdom of the nineties, turning experience and common sense on its head, is that higher taxes promote economic growth while lower taxes can always be counted on to make things worse...
...He is an apparent loser in the internal Balkan wars at the Journal and now has been put to pasture for the most part...
...They rarely see each other, and some of them are not even on speaking terms...
...It is hard to imagine Douglass going along with all those "progressives" who endorsed contemporary slaveryCommunism—on the grounds that it...
...In fact, Eisenhower's refusal to lower tax rates led to three recessions in eight years, virtually guaranteeing a Democratic victory in 1960...
...Neither notes that while the surtax enabled Johnson to balance the budget for one year, the extra tax bite—continued by Nixon after he was elected in 1968—was followed by prolonged stagflation that was not relieved until Reaganomics came about in the 1980s...
...As a believing Christian, however, Douglass was concerned above all with slavery's impact on the soul...
...In a leap of faith, Malabre suggests that Eisenhower's refusal to push for an anti-recession tax cut "probably created conditions conducive to the long expansion of the 1960s...
...First published in 1978 and updated last in 1989, it remains a tour de force, traversing the globe and the centuries to portray how the heavy hand of taxation impedes economic growth...
...As such, he is left with no ideology at all, aside from an agnostic's reliance on the business cycle...
...Terming Bartley's reporting career "undistinguished," Malabre assails outgoing editor Vermont Royster's selection of Bartley as his successor...
...Thus, when Douglass declares in his third autobiography, Life and Times, that "the abolition of slavery has not merely emancipated the negro, but liberated the white," he is not simply indulging in a fine turn of phrase...
...Pete Peterson is similarly bitter about growth-oriented Reaganomics...
...His own proposal is "The Peterson Budget Action Plan," which combines massive federal spending cuts with expanded taxabilityof federal benefits, limited tax deductions on home mortgages, increased federal "user fees," still higher marginal tax rates, a 5-percent consumption tax, a 50-cent gasoline tax, and hikes in tobacco and alcohol taxes...
Vol. 27 • April 1994 • No. 45
