I can't stop reading Anatole Kaletsky, the Times economics columnist. I know it bad for me. Almost everything he writes drives me crazy. He is doing my head in.
During the summer, he proclaimed that the US economy was just fine. Then came the failures of Freddie and Fannie, the Lehman bankruptcy and the near total meltdown of the world's financial markets.
The "US is just fine" line had to go. So Anatole peddled a different explanation; the global financial crisis was all down to one man; Henry Paulson. The US Treasury secretary screwed up; if only Paulson had acted more decisively, saved Freddie and Fannie, the world economy would still be growing. If only the all the problems of world could be reduced to such simple explanations.
Today, Kaletsky stopped playing the blame game and loudly endorsed Darling's borrowing binge:
"The Chancellor is right to cut taxes and to spend and borrow through the recession, undeterred by rising deficit projections and the build-up of public debt."
Like everything that Anatole writes, he provokes more questions than answers. Take the statement above as an example. The UK government needs to float about ₤150 billion of new debt in the next 15 months. Who does Kaletsky think will buy this debt? Does he think that long term interest rates will be unaffected by this massive increase in the supply of financial assets? Had he considered the possibility that yields on government debt might start to climb? Can he see the link between government debt yields and corporate borrowing costs? Would he accept that higher government borrowing might actually kill off the recovery that the Darling spendfest is supposed to deliver?
In Anatole's world, today is the only thing that matters. The UK needs positive economic growth right now, this very instant. The long term consequences of any policy does not matter. Later generations can deal with public debt we contract today. If Anatole could think of a way, he would also push today's banking crisis onto our children too. In fact, Anatole would endorse any policy that ensured that he, and his generation of middle aged debt-serfs, could maintain their ill-deserved way of life.
The real problem with Anatole is that he can't be ignored. He articulates the muddled thinking behind UK economy policy. When required, he champions misplaced optimism. Where necessary, he conspires with Brown in blame displacement for this mess; peddling the line that the UK's economic ills are down to some vague global crisis rather than policy mistakes. He is quick to endorse Darling's mad plans to buy his way out of recession. He will argue for the ridiculous line that the bank of England's policy rate should be negative in real terms, regardless of its catastrophic effect on long term savings.
Perhaps, this is why I keep reading his column.