Krugman In Wonderland

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Aox's criticism of Krugman is he criticized deficits during times of economic expansion and insisted on deficits during times of economic contraction and recovery, which is rudimentary Keynesian econmics.

Really are you sure? That's not neo-Keynesian? Or is asking that like something an uber-moron would do?

 

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You main criticism of Krugman is basically that he's a Keynesian.

My main criticism is that he is one of those Keynesians that only seem to take the bits they like and ignore the rest. Keynes was at great pains to insist that his theories applied to the whole of an economic cycle and not just to recessions. He also hated debt with a passion.

If we consult his writing, the scripture left by Keynes himself, we might be surprised to find that it would be a lot more than “prime the pump”—i.e., just run up the federal debt. For Keynes, the problem would be not just getting people into stores, or even getting employers to hire but getting our plutocracy to invest. It’s not just our jobless rate but our huge trade deficit that would appall him. He’d be aghast to see the United States bogged down in so much debt to the rest of the world.

I know: that’s not what people think. “Wait, wasn’t Keynes the one trying to get us into debt?” Yes, but not that kind of debt—in fact, as his biographer writes, Keynes personally hated debt. Especially in a recession, he hated to see a country with a trade debt, or trade deficit, which arises when a country’s imports exceed exports. Indeed, when the trade deficit is as jaw-dropping as the US trade deficit is now, it is harder to use Keynesian deficit spending to push employment back up. Keynes, unlike some of his disciples today, was quick to see this problem.
In 1936, when Keynes wrote his classic—The General Theory of Employment, Interest and Money—he was emphatic on this point: no country, ever, should run up any kind of trade deficit, much less the trade deficit on steroids we are running. Of course, in 1936 and for years after, the United States was the biggest creditor country in the history of the world. So Keynes never worried about our being a debtor country—rather, he spent much of his last days begging the United States to get other countries out of debt. If he came back and saw the colossal external debt we run now, he would be pushing for a serious plan to bring it down just as hard as he’d be pushing a stimulus for full employment.

http://www.thenation.com/article/163673/what-would-keynes-do#

 

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My main criticism is that he is one of those Keynesians that only take the bits they like and ignore the rest. Keynes was at great pains to insist that his theories applied to the whole of an economic cycle and not just to recessions.



http://www.thenation.com/article/163673/what-would-keynes-do#

Now you're changing your tune, Aox. What you said was your "main criticism of Krugman is he was warning about the high levels of government debt during the Bush era, quite rightly, yet now he is all for even more QE and deficit spending." Well, that criticism is pretty ridiculous for the reasons I've identified.

And while I respect the position of a labor lawyer writing in the Nation invoking Keynes to insist on protectionist measures to improve US trade deficits, but I don't think it serves as a good basis for criticism of Krugman, particularly if you've read much of what he has written on the trade deficit.

 

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I looked him up.

William L. Anderson is an author and an associate professor of economics at Frostburg State University in Maryland. He is also an adjunct scholar with the Mackinac Center for Public Policy as well as for the Ludwig von Mises Institute in Alabama.
Anderson was formerly a professor of economics at North Greenville College in Tigerville, South Carolina.
Anderson writes extensive commentaries on current issues from a pro-free market Austrian perspective, with columns appearing regularly on the libertarian website, LewRockwell.com. In 2006, one of his primary topics of interest was analyzing the evidence and media coverage of what turned out to be false rape charges by Crystal Gail Mangum against several young males at Duke University.
He is also a Libertarian critic of the policies of the widely read economist, Paul Krugman, and regularly criticizes many of Paul Krugman's policies in his blog Krugman in Wonderland, LewRockwell.com and elsewhere.[SUP][1][/SUP]

Whilst we are at it, it would be instructive to look at what Hayek actually said rather than what is attributed to him by those that have a axe to grind.

When discussing Hayek it is important to correct a misconception: Hayek's is not a "do nothing" theory. It does not deny that we should maintain spending when boom turns to bust. But it goes further.

Unlike Keynes, Hayek believed that genuine recovery from a post-boom crash called not just for adequate spending, but for a return to sustainable production - production purged of boom-era distortions caused by easy money. Hayek was dismissed as someone who wanted to "liquidate labour, liquidate stocks, liquidate the farmers," and so on.

But an unsustainable boom is one after which some things really do need liquidating. The straightforward recipe for the revival of healthy investment following the 2008 crisis was to liquidate. Liquidate Bear Stearns! Liquidate Fannie Mae and Freddie Mac! Liquidate, in short, the whole sub-prime bubble-blowing apparatus that was nurtured by easy monetary policy. That would have meant letting insolvent banks that lent or invested unwisely go bust.

But instead our governments chose to keep bad banks going and that is why quantitative easing has proven a failure.
Quantitative easing failed because almost all the new money the government created has gone to shore up the balance sheets of irresponsible bankers.

Read more: http://www.bbc.co.uk/news/business-14366054

 

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Yes, Whilst you are at it Christie, it would be instructive to look at that. And also, make sure you have your homework done.

I have no idea how anyone tolerates this pompous asshat. I crack up when I read his posts. Not his jokes, those aren't funny...but you know, his "serious" shit. This guy is soooo Cliff Clavin.

 

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Wouldn't it be better to criticise his assessment of Krugman rather than just attacking his credentials? My main criticism of Krugman is he was warning about the high levels of government debt during the Bush era, quite rightly, yet now he is all for even more QE and deficit spending.

If you expect ideological consistency you are barking up the wrong tree with this crowd.

Truth is they love deficits it is just what the deficits represent that matters to Krugman and his acolytes.

Deficit under Bush bad. Obama good.

Too be fair the GOP doesn't have much credibility either. They stood idly by while Bush expanded the reach of the federal gobblement.

I find very few principled folks on message boards on either side. BAC is a pretty principled bloke and if he weren't a Malcom X wannabe with a chip on his shoulder I would respect him more.

 

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If you expect ideological consistency you are barking up the wrong tree with this crowd.

Truth is they love deficits it is just what the deficits represent that matters to Krugman and his acolytes.

Deficit under Bush bad. Obama good.

Too be fair the GOP doesn't have much credibility either. They stood idly by while Bush expanded the reach of the federal gobblement.

I find very few principled folks on message boards on either side. BAC is a pretty principled bloke and if he weren't a Malcom X wannabe with a chip on his shoulder I would respect him more.

I love how the GOP only didn't care when Bush was running up deficits. I guess we'll all pretend that St. Ronnie of the Blessed Deficit ran balanced budgets.

 

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I love how the GOP only didn't care when Bush was running up deficits. I guess we'll all pretend that St. Ronnie of the Blessed Deficit ran balanced budgets.

The country has run deficits for years. It is a bipartisan issue. You apparently think it is not and I for one am not going to try to poke a whole in your carefully crafted delusion. The safety of your surrounding community is at stake and I don't want to be held responsible

 

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I love how the GOP only didn't care when Bush was running up deficits. I guess we'll all pretend that St. Ronnie of the Blessed Deficit ran balanced budgets.

I saw a video recently of Krugman saying that deficits don't really matter for countries like America that control their own currencies. They can just print more money without any repercussions. He also said that interest rates are not important as they are controlled by the Fed.

 

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I saw a video recently of Krugman saying that deficits don't really matter for countries like America that control their own currencies. They can just print more money without any repercussions. He also said that interest rates are not important as they are controlled by the Fed.

(1) I very seriously doubt that Krugman said what you claim he said regarding deficits as a statement of general applicability as opposed to a statement about conditions at the time he made the statement.

(2) I very seriously doubt that Krugman said that regarding interests rates as a general matter.

 

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(1) I very seriously doubt that Krugman said what you claim he said regarding deficits as a statement of general applicability as opposed to a statement about conditions at the time he made the statement.

(2) I very seriously doubt that Krugman said that regarding interests rates as a general matter.

Can't find the video but this Money Morning article sums it up neatly.

http://moneymorning.com/2012/01/09/paul-krugman-is-dead-wrong-debt-matters/

 

[Bonestorm]

Can't find the video but this Money Morning article sums it up neatly.

http://moneymorning.com/2012/01/09/paul-krugman-is-dead-wrong-debt-matters/

So you can't support your claims but point me to a column from someone who thinks Krugman is wrong about some things? OK. Thanks. That's helpful. What, exactly, does the column "sum up nicely?"

 

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So you can't support your claims but point me to a column from someone who thinks Krugman is wrong about some things? OK. Thanks. That's helpful. What, exactly, does the column "sum up nicely?"

I can't find the video now, I will have a look later when I have more time. I am in the middle of retiling a bathroom. As for what the article says, it is in English and that's your first language, is it not?

 

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I can't find the video now, I will have a look later when I have more time. I am in the middle of retiling a bathroom. As for what the article says, it is in English and that's your first language, is it not?

LOL That's awesome. In the middle of tiling a bathroom so cannot back up your claims, but you have plenty of time to take notes as well as comment on who I am talking to and whether or not so and so still hates me, and how Grind and I are doing since we disagreed.

Did I peg you when I named you as a washwoman or what? Hilarious.

 

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I can't find the video now, I will have a look later when I have more time. I am in the middle of retiling a bathroom. As for what the article says, it is in English and that's your first language, is it not?

I didn't ask what the column says. I know what it says. I asked what the column "sums up nicely." What you meant by that isn't dependent on my proficiency with the English language but my ability to read your mind. I'm good, but I'm not that good.