Afternoon Delight

Estonia to Krugman: Y’all Needs to Chill

June 09, 2012

Multiple Pages
Estonia to Krugman: Y’all Needs to Chill

The ex-Soviet satellite state of Estonia is home to slightly over a million people and is smaller than Vermont and New Hampshire combined. Yet in the contentious debate between “austerity” and “stimulus”—i.e., ceasing to spend far more than you have versus further indenturing your citizen-vassals for generations—it’s becoming the mouse that roared.

A few facts about the thumbnail-sized Baltic nation:

• In a 2006 State of World Liberty Index review of 159 countries based on “economic and personal freedoms,” Estonia ranked first.

• As of 2010, it boasted—by far—the lowest debt-to-GDP ratio of all countries in the eurozone.

• It’s the eurozone’s only country to report budget surpluses for two years running.

• Its economy is growing faster than any other nation in the EU.

“It’s refreshing to see politicians barking back at their theory-addled critics like standup comics smacking down a petulant heckler.”

Estonian austerity (Esterity?) programs, as well as the fact that the country has adopted a Friedmanesque flat tax since 1994, would seem to be responsible for at least a few of these glittering statistics. Yet this is highly uncomfortable for economists who make their living by urging statist intervention and deficit spending.

When it seemed as if Estonia was bouncing back from a deep recession by using policies that statist economists insist would only drive countries deeper into economic despair, Nobel laureate and New York Times columnist Paul Krugman called the country the “poster child for austerity defenders”  and saw fit to pee on their parade last week.

Bane of anti-globalists and a self-described “unabashed defender of the welfare state,” Krugman was critical of Obama’s initial stimulus plan only because he said it was far too small. He has likened European austerity attempts to a “medieval doctor, you’re sick so he bleeds you, you get even sicker he bleeds you some more.”

Apparently unbeknownst to Krugman, the same metaphor could be used to describe extracting further tribute from already stressed taxpayers.

After Krugman pooh-poohed the recent successes of the diminutive nation known as the “Baltic Tiger,” bow tie-wearing Estonian President Toomas Hendrik Ilves (pronounced “ILL-vis”) took Krugman to task on Twitter. Ilves left the following string of posts in what some are suggesting was a drunken rage on June 6:

Let’s write about something we know nothing about & be smug, overbearing & patronizing: after all, they’re just wogs….

Guess a Nobel in trade means you can pontificate on fiscal matters & declare my country a “wasteland”. Must be a Princeton vs Columbia thing.

But yes, what do we know? We’re just dumb & silly East Europeans. Unenlightened. Someday we too will understand. Nostra culpa.

Let’s sh*t on East Europeans: their English is bad, won’t respond & actually do what they’ve agreed to & reelect govts that are responsible.

Chill. Just because my country’s policy runs against the Received Wisdom & I object doesn’t mean y’all gotta follow me….

Sorry, not conserv. or leftist. Just can’t fathom why following agreed upon EU fiscal rules justifies smug & snide gloating re: my country.

Ilves, who was born in Estonia but raised in New Jersey, also linked to an essay he’d written in March titled “I’ll Gladly Pay You Tuesday”—a reference to the hamburger-mooching Popeye character named Wimpy. Ilves’s essay asserted that “privilege without merit leads to Soviet-style stagnation” and that progressive economists naively posit “some kind of utopian convergence” at an unspecified point in the future.

Under 50+ years of Soviet occupation (AKA “Occupy Estonia”), that “utopian convergence” never occurred.

Above and beyond the odd pleasure of watching an Eastern European head of state employing hip-hop slang and cartoon references was the fact that Ilves turned the tables on Krugman and accused him of being an out-of-touch, elitist bigot. (Krugman has frequently dismissed criticism of the New Deal and every Newer, Bigger Deal that comes down the pike as veiled racism.)

Ilves’s cohorts rushed to his defense. Estonian Finance Minister Jürgen Ligi slammed Krugman as a “hack writer and a champion of the [US] president’s policies”:

In reality, Krugman has to a great extent supported the system that created our poverty and which is now over…we cannot solve our poverty according to those recipes—by borrowing money and buying ourselves expensive things.

Aww, SNAP! Krugman done got served!

Estonian Defense Minister Urmas Reinsalu eagerly leaped atop the anti-Krugman dogpile:

Above all, even his most voluminous writings assert that the public sector must grow, be indebted and foster state-sponsored jobs…Estonia is a problem for Krugman because Estonia doesn’t fit into his theoretical model.

That’s right! And your mama’s mama, too!

Although Estonia’s case is hardly representative of Europe or the world’s broader financial woes, it’s refreshing to see politicians barking back at their theory-addled critics like standup comics smacking down a petulant heckler. If there’s any hope at stanching Globalist Government Creep, it may lie with people such as our unapologetically feisty Wogs from the East.

 

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