Krugman is pretty ticked off at conservative historian-for-hire Niall Ferguson for a "plain misrepresentation of the facts, with an august publication letting itself be used to misinform readers." He wonders if Newsweek will call for an apology. (Yeah, I'm sure it's coming right up.)
In the past, Krugman has called the Harvard professor a "poseur" who, when it comes to economics, "hasn't bothered to understand the basics, relying on snide comments and surface cleverness to convey the impression of wisdom. It's all style, no comprehension of substance."
I have to agree. Ferguson's area of expertise is history, but frequently opines on economics, and has a long-standing feud with Krugman. As anyone who follows his frequent pronouncements knows, Ferguson is frequently wrong - and I haven't seen an apology yet. (Fun trivia fact: The Times reports that Ferguson encouraged Paul Ryan to run for president!)
There are multiple errors and misrepresentations in Niall Ferguson’s cover story in Newsweek — I guess they don’t do fact-checking — but this is the one that jumped out at me. Ferguson says:
The president pledged that health-care reform would not add a cent to the deficit. But the CBO and the Joint Committee on Taxation now estimate that the insurance-coverage provisions of the ACA will have a net cost of close to $1.2 trillion over the 2012–22 period.
Readers are no doubt meant to interpret this as saying that CBO found that the Act will increase the deficit. But anyone who actually read, or even skimmed, the CBO report (pdf) knows that it found that the ACA would reduce, not increase, the deficit — because the insurance subsidies were fully paid for.
Now, people on the right like to argue that the CBO was wrong. But that’s not the argument Ferguson is making — he is deliberately misleading readers, conveying the impression that the CBO had actually rejected Obama’s claim that health reform is deficit-neutral, when in fact the opposite is true.
More than that: by its very nature, health reform that expands coverage requires that lower-income families receive subsidies to make coverage affordable. So of course reform comes with a positive number for subsidies — finding that this number is indeed positive says nothing at all about the impact on the deficit unless you ask whether and how the subsidies are paid for. Ferguson has to know this (unless he’s completely ignorant about the whole subject, which I guess has to be considered as a possibility). But he goes for the cheap shot anyway.