Famous Economist Makes Fool Of Self On CNN

Arthur Laffer is a former advisor to President Reagan and the creator of the Laffer Curve, the notion that if tax rates get high enough that tax revenues will go down. It is a nice intuitive theory, but empirically, like a lot of macroeconomics, it is wrong. ("According to Nobel prize laureate James Tobin, '[t]he 'Laffer Curve' idea that tax cuts would actually increase revenues turned out to deserve the ridicule with which sober economists had greeted it in 1981.'"). Mr. Laffer also warned CNN viewers yesterday (via Krugman's blog):

[J]ust wait till you see Medicare, Medicaid ... done by the government[.]

I guess he didn't get the memo. You know, the one about Medicare and Medicaid being the primary government run health plans in the United States.

He was in graduate school at Stanford getting his MBA and PhD when the programs were created (in 1965) and in the six years that followed when the government agencies that created the plan were set up and the regulations were drafted, around time my dad was getting PhD in civil engineering there. Maybe he didn't get out much. It happens. And, maybe, when he was an advisor to President Reagan in the White House office on public finance issues, he never looked at the federal budget. This would explain a lot about his public finance work.

Fool or fraud? We report, you decide. Does the fact that I remember the days when CNN was a credible news source make me old?