Robert Kuttner

Robert Kuttner
The economic illusion is the belief that social justice is bad for economic growth.

Robert Kuttner (born April 17, 1943) is an American journalist, writer and economist. Kuttner is the co-founder and current co-editor of The American Prospect, he is also one of the five co-founders of the Economic Policy Institute and currently serves on its board of directors.

Quotes

• Technological change is beneficial only when other jobs replace the ones lost.
  • Guardian Weekly, August 08, 1993

• Can we reverse these deeply rooted sources sources of inequality? Or are they just endemic to a capitalist economy?
  • Guardian Weekly, June 30, 1996

The Economic Illusion (1984)

• The economic illusion is the belief that social justice is bad for economic growth.
  • Introduction, p. 1 (First text line.)

• But of course you can have your cake and eat it, too - if you decide to to bake a second cake. And you may well find that baking two cakes does not take twice the work of baking one.
  • Chapter 1, Equality and Efficiency, p. 14

• In practice, a good deal of the outcomes produced by the market reflect nothing more than luck - good or bad.
  • Chapter 1, Equality and Efficiency, p. 16

• American critics of welfare statism are often surprised to learn that countries like West Germany, with a much more comprehensive welfare state and a statistically "larger" public sector, have fewer government employees per capita than the United States does.
  • Chapter 1, Equality and Efficiency, p. 23

• Keynes, like Freud and Marx, deserves to be read in the original, not through the glosses of his lesser disciples.
  • Chapter 1, Equality and Efficiency, p. 27

• In America, we build public housing by creating lucrative inducements to private developers, and then wax indignant at the public waste.
  • Chapter 1, Equality and Efficiency, p. 37

• It is more than a little ironic that "capital accumulation" once a rather tendentious Marxian view of a supposed capitalist obsession, should have become - of all things - Wall Street's own slogan.
  • Chapter 2, Capital, p. 51

Henry Ford, in a sense, was the first Keynesian. He paid his assembly workers high wages so they could afford to buy his cars.

• If social security depresses savings rates, it is only because it is unfunded.
  • Chapter 2, Capital, p. 77

• When laissez-faire creates instability, the move to a freer market can be something less than pure gain.
  • Chapter 2, Capital, p. 85

• If Boeing got a big head start on the 707 from multibillion-dollar military contracts to develop an air force transport, is that a sin against free trade?
  • Chapter 3, Trade, p. 96

• Technological advance often thrives in sheltered and subsidized markets, which defy free trade.
  • Chapter 3, Trade, p. 97

• In a world where technology and capital are highly transferable, there is a real risk that comparative advantage comes to be defined as whose labor force will work for the lowest wage.
  • Chapter 3, Trade, p. 102

• We are already well down the road toward a managed-trade regime. It would be far better to acknowledge that reality, and seek a set of reasonable rules, than to pretend that Ricardian trade is the norm and allow mercantilist states to overwhelm U.S. industry and ratchet down wages, in the name of free trade.
  • Chapter 3, Trade, p. 124

• Henry Ford, in a sense, was the first Keynesian. He paid his assembly workers high wages so they could afford to buy his cars.
  • Chapter 4, Labor, p. 169

• Not surprisingly, extensive effort in Britain and America goes into finding tax shelter. the system is "efficient" for the shelter industry, not for the economy.
  • Chapter 5, Taxes, p. 188

Unfortunately, the Laffer curve did not work as advertised. Lower tax rates did not produce more tax revenues. They produced deficits.

• The total impact of the Reagan tax cuts on capital lowered the effective cost of capital to American industry by an estimated 1.2 percent. Unfortunately, the Laffer curve did not work as advertised. Lower tax rates did not produce more tax revenues. They produced deficits.
  • Chapter 5, Taxes, p. 208

• Political conservatives have focused on tax reduction as an economic growth strategy for three reasons. First it is self-serving; it saves rich people lots of money. Second, it comports with their ideological allegiance to laissez-faire economics. And third, tax incentives are less intrusive to business-as-usual than any other form of government planning.
  • Chapter 5, Taxes, p. 227

• By default, we have created a "system" of nursing-home care for the aged in which middle-class people pay exorbitant rates to for-profit nursing-home entrepreneurs - and then when private resources are consumed and the patient qualifies as a pauper, the nursing home begins billing Medicaid. This is precisely the antithesis of social citizenship; instead of the poor being accorded the dignity associated with the middle class, equality of treatment is achieved by making the middle class undergo pauperization.
  • Chapter 6, Welfare, p. 239

• Britain, with the most completely socialized health system in the West, now spends the lowest fraction of GNP on health care of any major nation. There are frequent complaints of excessive waits for elective surgery and other inconveniences, but British citizens live slightly longer than Americans, on average, and our overall health conditions are comparable.
  • Chapter 6, Welfare, p. 250

• Why, then, should we have to lower our living standards? What is the mysterious source of the economic loss? If productivity is increasing, why should we sacrifice services and wages?
  • Epilogue: Politics, p. 272

• I have tried to suggest that injustice is not necessary economics;that the economics can work, and has often worked, when the constituency for it is animated. The politics of equality - that is a little harder.
  • Epilogue: Politics, p. 278 (Last text lines...)

Quotes about Kuttner

• Kuttner then enumerates the limitations of markets. Deregulation of airlines, for example has led both to a loss of service and to higher average fares. Nor are free markets really free. They come to be dominated by giants, like Time Warner and Rupert Murdoch.
  • Richard Gwyn, The Toronto Star, February 5, 1997