Irving Kristol's way the world works

The king of the neocons was the man behind the man who coined the term "supply-side economics"

By Andrew Leonard
Published September 29, 2009 2:25PM (EDT)

The legacy of the neoconservative godfather, Irving Kristol, has been sufficiently debated and analyzed in the ten days since his death that joining in the clamor at this point seems a tad redundant. But if David Warsh, the sage chronicler of all things economic, can wait a week and a half to deliver his memorial at Economic Principals, so can I.

Kristol's influential journal, The Public Interest, founded in 1965, initially featured voices from across the political spectrum. But over time, the editorial scope narrowed. By 1975, Warsh writes, Kristol had chosen his side, a particular brand of dumbed-down economics that ended up influencing the course of government for decades.

The side he picked in economics was an odd one. A 1975 issue featured a pair of articles: "The Social Pork Barrel" launched the career of a young Michigan Congressman, David Stockman, who would become budget director for Ronald Reagan; and "The Mundell-Laffer Hypothesis -- a New View of the World Economy," by Wall Street Journal editorial writer Jude Wanniski, introduced the world to economists Arthur Laffer and Robert Mundell, and their newly-invented brand of "supply side economics."

Eric Alterman writing in The Nation in 1999, adds some detail:

A regular contributor to the Wall Street Journal and a close comrade of its editor, Robert Bartley, [Kristol] was introduced to the page's self-described "wild man," Jude Wanniski. Despite the fact that Wanniski had no formal training in economics, he believed (and still believes) that in the now infamous "Laffer Curve," whereby lower taxes on the rich allegedly lead to higher government revenues, he had found the key to all human happiness. Wanniski needed money and a place to write and think while he composed a supply-side manifesto based on the Laffer theory.

According to Wanniski, Kristol convinced the folks at Smith Richardson to give Wanniski $40,000 to write a book, of which $10,000 went to AEI to house him. His manifesto, "The Way the World Works "(1978), proved to be the bible of a movement that transformed fiscal policy and economic debate.

Early in the life of this blog, some readers asked if How the World Works was a reference to Wanniski's "The Way the World Works." It wasn't, although now I kind of wish it was. Not only would it be a bizarre proof of the theme of interconnection that pervades HTWW to trace a route from me to Irving Kristol, but it also says something about the slipperiness of knowledge and understanding when nearly the same title can apply to two antithetical world views.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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