In my post earlier today about Paul Krugman’s winning the Nobel Prize for Literature–I mean, for Economics–I noted that it was some small consolation that, although Krugman is now $1.4 million richer, if Obama is elected (a big “if,” but still . . .), he might well “start nosing around that ‘windfall’ profit” and take a good bit of it for his various “social” programs. Now a friend informs me that proceeds from the Nobel are tax exempt. Drat! This same friend, however, had a cheering suggestion that should be implemented by the candidate who wins the election. It is, for once, a truly innovative idea that deserves enthusiastic bipartisan support. He calls it:
The Krugman Tax for Undeserved Prizes
The rate would be 200 percent.
And people say I am against increasing taxes! Not at all. It’s just that I believe tax increases should be fair and support the common weal, which this tax surely would. Considering the number of undeserved prizes around–the Nobel Prizes represent only the tip of a very large iceberg–I expect it could net the U.S. Treasury a tidy sum–and Lord knows they need it! 700 billion here, 700 billion there: pretty soon you’re talking about real money!
Anyway, I encourage a bi-partisan grass-roots movement to support The Krugman Tax for Undeserved Prizes and let’s do it now so that the inspiration for this piece of social justice can have the benefit of helping those he pretends to care about.
[UPDATE: Alas, my friend was wrong. Unless the recipient donates the proceeds to a qualified charity, money from the Nobel Prize is taxable. I continue to think that in Paul Krugman's case, the special Krugman Tax of 200 percent whould be considered.]
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31 Comments
1. J.J. Sefton:Well, their not citizens but Le Duc Tho and Rigoberto Menchu should fork it over. And of course, your pal and mine, Uncle Al (not the kiddies’ pal) Gore.
Now that’s what I would call some serious social justice!
Oct 13, 2008 - 8:59 am 2. J.J. Sefton:their = they’re. And I’m a writer by profession. Ugh!
Oct 13, 2008 - 8:59 am 3. airth10:As I read this piece about Krugman I think of it as tongue-in-cheek because I am also looking at Roger’s face on this page, which just has a smirk on it and doesn’t appear serious at all. It is the same expression I see every time I come to this page, which says to me , Don’t take me too seriously, I am just making a living.
He does have a sense of humor.
Oct 13, 2008 - 11:41 am 4. bf domitrovic:Prizes are taxable unless designated beforehand as going wholly to charity. On a viedo on the Nobel website, you can see Robert Mundell lament how the otherwise sterling Tax Reform Act of 1986 made them so, in his (incomparable) Nobel lecture of 1999.
Oct 13, 2008 - 11:51 am 5. Pizda Mnie Boli:I agree, this is the only tax I would wholeheartedly support.
Oct 13, 2008 - 12:28 pm 6. David Thomson:I do think that Paul Krugman is receiving the Noble Prize primarily for his present day leftism. Nonetheless, serious economists hold his past work in high esteem! We must give credit when it is due. Krugman is similar to Andrew Sullivan. Only a few years ago they both often wrote sensible stuff.
Oct 13, 2008 - 1:18 pm 7. srlucado:When I think of Milton Friedman winning the Nobel, then I think of Krugman…ye gods.
Scott
Oct 13, 2008 - 6:34 pm 8. Fausta’s Blog » Blog Archive » Krugman wins Nobel Prize:[...] The Krugman Tax for Undeserved Prizes, since Nobel proceeds are tax-exempt. [...]
Oct 13, 2008 - 8:16 pm 9. Pajamas Media » The Krugman Tax For Undeserved Prizes:[...] the entire post here [...]
Oct 14, 2008 - 12:21 pm 10. iconoclast:Krugman is still a Keynesian, by his own admission.
Politics drives the Nobel awards? Yah think?
Oct 14, 2008 - 1:00 pm 11. Neil Speakman:Paul Krugman may or may not deserve the Nobel Prize for his particular work relating to trade theory but it is a pity that he did not use his status to bring focus upon the real issue of our time in his 2004 book “The Great Unravelling”, as the email below explains.
The realities of the USA property market and the underlying USA issues were ignored, at a time when a voice such as his could have have provided a much needed sense of reality well in advance of the current debacle.
Regards
Neil Speakman
September 2004 to Paul Krugman, NY Times
Paul
It is only in the last three days that I have read “The Great Unraveling”, congratulations.
I do believe that you have yet to comment upon a vital issue that seems to be a sacred cow and ignored by most.
Economists, investment advisors and commentators have not looked at the real economic situation for the average person in USA. Such a person has consistently been raising cash for consumption from the increase in their property values; lack of appropriate employment and low wages have forced this upon many even though they are unworthy borrowers. Check this out amongst your family and friends and you will see this reality.
I am not certain when property values will crash, but one thing is for sure, people will not be able to continue in this way but the effect will certainly be a fall in consumption plus a major debt crisis for individuals and corporations lending to them.
The key method of funding the USA consumer economy has been via the increase in property values rather than the stock market or earned income. Many people have been using the increase as a substitute for income and consuming accordingly; this cannot continue and when this cycle does end, there will be two results;
1. People will have debts to repay and they will not be able to do so.
2. People will not have disposable income with which to consume; as a result the US economy will be badly effected. This is not understood.
Additionally, the increase in property values has even further widened the divide between rich and poor and has also affected the international competitiveness of the USA.
The increase in the capitalized value of residential property over the last five years is many trillions of dollars; this has been the fuel for the USA consumer economy and not the stock market or earnings from gainful employment. Your book does not recognize this reality which actually affects the individual much more than stock market movements.
I do not envy the next President (2004 election), as the bad news from this and many other USA economic and political realities may well be kept under wraps as much as possible until the election is over.
I hope that you find these comments of interest and I would certainly like to see something along these lines reflected in your future writings.
Regards
Neil Speakman
Oct 14, 2008 - 2:12 pm 12. otherjeff:I think that Krugman did some good economic work when he was doing the stuff he was awarded the prize for. It is interesting and stimulating data, and debunks a lot of myths.
His career as a columnist is not even Pulitzer worthy. Unfortunately, he is a Keynsian, and shows it in his opinions. As we know, Keynes hypothesized an economic idea. His idea was flawed, but it did advance economic thought.
Oct 14, 2008 - 2:41 pm 13. proud elitist:Even Friedman respected Keynes. (But not Gailbreath!)
Whatcha talkin’ about David @ 6? Both Sullivan and Krugman write sensible stuff all of the time.
Had Bush been listening to Krugman’s bell whistles all of this time, I do wonder what state our economy could presently be in.
Oct 14, 2008 - 2:54 pm 14. Professor Guvinoff:Okay, let’s make it retroactive and collect Yasser Arafat’s tax, plus late fees!
Oct 14, 2008 - 2:54 pm 15. DOUBLE B:this award to krugman just goes to show you that the nobel can be given to any
Oct 14, 2008 - 2:57 pm 16. Joseph Marshall:idiot…..
I am normally inclined to give authors such as Roger Kimball and Victor David Hanson a fair amount of respect. And it is not a grudging respect, even though my political views are not in the least in agreement with their’s.
When they stay within the compass of things they actually know something about, I can learn much by reading them, even though I have to discount their Humanities Hubris, which is essentially nothing more, I think, than a dislike of doing sums, and a compensatory and projective lack of respect for the people who do sums well.
I can’t do it in this case.
There is absolutely nothing in the above essays to support the notion that Roger Kimball has read anything of consequence in Economics.
There is nothing to support the notion that Kimball has read the work for which Krugman actually received the Nobel.
There is nothing to support the notion that Kimball has read whatever professional criticism Krugman’s peers have directed toward that work, what the consequences of the criticism have been, and what consensus Krugman’s profession has settled into toward that work.
A little light digging into what I can find of RK’s scope of career, gives no indication that he has read any of the above things, either.
He is an “art and social critic”.
You could not find a starting point of greater ignorance about the quality of Paul Krugman’s professional work in Economics, or the merit of its recognition.
Essays like this are not only presumptuous intellectual bad manners, they are also a patent violation of intellectual ethics.
The reason for RK’s adventure into an issue so totally out of his depth, is the Humanities Hubris written on the scale of a Manhattan skyscraper.
Through the lens of that Hubris, the cultural heritage we share from Plato [say] becomes major and that of Euclid or Archimedies remains minor, even though Plato himself argued that the mastery of arithmetic, plane geometry, solid geometry, astronomy, and harmonics, was a necessary precondition for the serious study of philosophy.
Now I, myself, have only read around in Economics and I don’t doubt that I merely have enough knowledge to be dangerous. So I really can’t say whether Krugman deserves this award or not. And I have sense enough not to venture an opinion one way or the other.
But I can venture the opinion that RK is making a world class fool of himself through his assumption that he knows whether Krugman deserves this award or not.
Oct 14, 2008 - 5:09 pm 17. Duude:I find the awarding of the economic nobel peace prize interesting for a number of reasons.
1) Days before the nobel prize for economics was announced, I heard something I never heard in my 49 years of life. They actually offered what seems like a sort of disclaimer of who was their eventual choice. They said in this difficult year in economics it was difficult to pick among the choices. This is a first for disclaimers.
2) This award was based on work done 30 years ago. I’m certainly not an expert on the awarding of Nobel Peace prizes, but 30 years?
3) For a number of years now the awarding of the Nobel Peace prize has taken on a serious political tone among various affected communities. This has been a growing trend for the last five or ten years. What’s that about?
4) Paul Krugman is best known for his New York Times column. He is also better known for his political rhetoric then his economics.
5) The Nobel Prize committee is largely made up of political liberals and socialists.
This all says more about the Nobel Prize committee than it does about Paul Krugman.
I find it interesting that Paul Krugman’s prize is not only based on work done 30 years ago, but it runs counter to Barack Obama’s ideology. Make no mistake, Paul Krugman is a liberal Barack Obama supporter, but Obama has already stated his intentions of reworking all free trade agreements. Paul Krugman’s work can’t be mistaken as anything but hardcore free trade. Does Paul disagree with his earlier work that has now won him the Nobel? If he now does disagree, I can guarantee he won’t say a word. However, if he believes his work is good, his beliefs run counter to Barack Obama. Tsk, Tsk….what a dilemma.
Oct 14, 2008 - 5:18 pm 18. proud elitist:Interesting, Double B.
I would like to see your commentary on the other Nobel winners. I presume you have an issue with those nutty leftists who were awarded the Nobel in Medicine and Physiology to 1) Harald zur Hausen (German) for his discovery for his discovery of human papilloma viruses causing cervical cancer and to 2) co-winners Françoise Barré-Sinoussi and Luc Montagnier (both French) for their discovery of human immunodeficiency virus.
I really presume since Drs. Barré-Sinoussi and Montagnier are French, you must be beside yourself over this award!
OH, TEH STOOPID!
Oct 14, 2008 - 5:27 pm 19. David:Krugman is a first rate economist. However, most of his columns have nothing to do with his area of considerable expertise. His qualifications for political commentary are about the same as his knowledge of sewer engineering.
Since the Nobel Prize is tax free (it’s considered a gift for income tax purposes), wouldn’t it be nice if Paul Krugman just paid usual income tax rates on his winnings. Krugman favors windfall profits taxes on oil companies, so why not on economists?
Oct 14, 2008 - 5:49 pm 20. Stephen McQuade:Bow Tie Boy, are you Jealous?
Oct 14, 2008 - 6:40 pm 21. Roark:The Nobel Prize has become nothing more but a blue ribbon for leftist causes and thinkers, Krugman and his Keynesian crackpot economics theory winning the award being an excellent case in point.
Oct 14, 2008 - 8:53 pm 22. dgforbes:a big ‘if’ as to whether obama wins? not so long ago, it was going to be a mccain landslide. so a dullesian process of gradual if agonising reappraisal seems to be taking place. at this rate, by nov 3, we should have a reached a point where reconciliation with the real world heaves into the full glare of daylight. i know it will be elegant as always but i wonder how he’ll phrase it. in the meantime, is there a nobel prize for back-pedalling?
Oct 15, 2008 - 3:42 am 23. harry:The day Arafat won a Nobel prize for Peace was the day Nobel became a joke. Krugman is just a smirk.
Oct 15, 2008 - 5:40 am 24. myth buster:It’s normal that the work for which Krugman was awarded the Nobel Prize was 30 years ago. It normally takes 20-30 years to be recognized by the Nobel Prize comittee.
Oct 15, 2008 - 9:31 am 25. Darren:How pleasant for Dr. Krugman that the Nobel Committee chose this year to recognize his work.
Next year his prize money would have made him part of the 5% of Americans whose wealth needs to be spread around, to help the people “behind” him.
Oct 15, 2008 - 12:47 pm 26. RobF:These UN prizes are an anachronistic joke today. Who is there to respect these ‘world’ organisational bodies anymore other than the world’s greediest, most corrupt, shallowest worst of the worst? – that should be the only prize these grafters are qualified to give out.
Oct 15, 2008 - 1:50 pm 27. Someone75:A nice bit of satire. I would support the Krugman Tax. Lets make it retroactive so Al Gore can surrender his bogus award from a few years ago. At very least, give it to the scientists that actually did his work for him.
Oct 15, 2008 - 1:58 pm 28. lmk:Two posts on Krugman and still no use of the words “New Trade Theory”? Is this serious?
Oct 16, 2008 - 12:18 pm 29. Red Blooded American:Congratulations Kimball. You once again confirm what an utter waste of energy reading anything you write will turn out to be.
Oct 19, 2008 - 4:55 am 30. tanstaafl:The Nobel committee seems whacked, and I mean whacked in some of its choices, particularly over the last couple of decades.
From literature, to peace, to economics to…(fill in the blank)…I imagine that ole Alfred might be rolling over in his grave at much of that which is being celebrated/elevated in his name.
Oct 19, 2008 - 8:42 am 31. Expressions:No one should be exempt. The elitists illuminati should tax their Ivy-League alliances as well. We shouldn’t buy into the socialism at all!
Oct 25, 2008 - 11:21 am