Well I didn’t suggest he was good on everything – I mean, he’s good for a liberal – an “Atari Democrat” was someone who was less-bad. And Kaus is a bright, thoughtful guy. But I doubt he’s read much if any Austrian economics, ever.
Probably he’s more influenced by what’s called “Welfare Economics” and “Social Choice” theory – and while the “Welfare” in that doesn’t explicitly mean “welfare” in the public-policy sense, it often leads to that, plus has certain features/premises which, while grounded in the mainstream economic theory from which is derived – and which accepts supply & demand curves – often leads to conclusions that an Austrian would find bizzaro.
And if you were to send him a mail asking what he meant by that, and how he reached that conclusion, he would be able to explain it logically – and he would almost certainly concede that the market plays some role, and that markets are very important (but his definition of “market” would be very different from that of, say Mises – the definition used by people of his sort tends to *include* certain “rules-of-the-game” interventions by government as *part* of the market), but he would also say that social attitudes (such as disapproval of conspicuous consumption) and public policy incentives shape what it is suitable for people to earn.
So he shares a lot of interventionist premises with, say, Krugman. And he has no principled objection to the kind of policies Krugman advocates. He just thinks Krugman is wrong historically and wrong about what the policy effects of implementing Krugman’s solution would be.
He does make a lot of good arguments in that post, so it can be used for those arguments. But he isn’t operating from the same foundations as an Austrian would. Which in a way may make Kaus’ post useful; one doesn’t have to be an Austrian to point out that Krugman just has his facts wrong and incomplete to the point of mendacity.