Paul Krugman Now Laughingstock On Two Continents

S

SmarterthanYou

rebel
http://reason.com/blog/2010/06/24/paul-krugman-now-laughingstock

It's always the right time to ignore Paul Krugman, the New York Times columnist, Nobel Laureate and four-time Latin Grammy nominee whose drink-yourself-sober advice on handling the debt crisis is so sharply at odds with reality.

Of late, Krugman has had his Irish up at Europeans who are resisting the Obama Administration's plan to continue spending hundreds of billions on financial stimulus. (Not that he agrees with the administration, which Krugman has been arguing for the last 18 months should be spending trillions, not mere billions, on stimulus.) And in the case of Bundesbank president Axel Weber -- whom Krugman called out recently in the daily Handelsblatt for trying to shore up the falling euro at the expense of government job creation -- it's created a backlash. The Wall Street Journal reports that Krugman's criticism has turned him into the anti-Hasselhoff and boosted Weber's popularity as he pursues the top job at the European Central Bank:

Wolfgang Franz, who heads the German government’s economic advisory panel known as the Wise Men, tore into Krugman — and the US — in an op-ed in the German business daily Wednesday, titled “How about some facts, Mr. Krugman?”

“Where did the financial crisis begin? Which central bank conducted monetary policy that was too loose? Which country went down the wrong path of social policy by encouraging low income households to take on mortgage loans that they can never pay back? Who in the year 2000 weakened regulations limiting investment bank leverage ratios, let Lehman Brothers collapse in 2008 and thereby tipped world financial markets into chaos?” he wrote.

Unfortunately, as Krugman notes in his response, Franz managed to find the weakest arguments against the Times' fiscal shaman. Europeans have lost their appetite for digging deeper holes of debt for the same reason Americans have: because they don't have a choice. As Margaret Thatcher predicted would happen, we have all run out of other people's money. That reality explains a lot more than airy references to Germans' anti-inflationary mass psychology.

We're at the tail end of the largest economic intervention since World War II, and even on its own narrow, nebulous terms, it has been a colossal failure. The failure is obvious to working people. It's obvious to unemployed people. It's obvious to kindergarteners, to dogs and cats. Only Paul Krugman persists in thinking good things will happen if we just throw more money on the barbecue.
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all I can say is, it's about damn time.
 
I actually can't stand Krugman, but how is it "obvious" that the stimulus has "failed"?

That's really a completely premature, and in my opinion, uninformed conclusion. I don't recall anyone saying that stimulus would have us back to the same employment levels in a little over a year (cue googlers finding one quote from one guy saying something remotely close to that).

I don't think it's failed. I think without it, we'd still be in a deep depression.
 
Onceler said:
I actually can't stand Krugman, but how is it "obvious" that the stimulus has "failed"?

That's really a completely premature, and in my opinion, uninformed conclusion. I don't recall anyone saying that stimulus would have us back to the same employment levels in a little over a year (cue googlers finding one quote from one guy saying something remotely close to that).

I don't think it's failed. I think without it, we'd still be in a deep depression.
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Unemployment is still 10 to 11%.....and the only justification you can come up with is, "it would have been worse"....what bullshit....it is worse....and that excuse is just an imaginary scenario of wishful thinking...or is that the "hoping' you peckerheads voted for...."wishful hoping".....
You have no clue what would have happened without spending the country into bankruptcy....

and incidentally....it was your messiah that quipped, unemployment would be at 8% awhile ago.....
 
Onceler said:
I actually can't stand Krugman, but how is it "obvious" that the stimulus has "failed"?

That's really a completely premature, and in my opinion, uninformed conclusion. I don't recall anyone saying that stimulus would have us back to the same employment levels in a little over a year (cue googlers finding one quote from one guy saying something remotely close to that).

I don't think it's failed. I think without it, we'd still be in a deep depression.
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However, we all do remember hearing that it would "peak" at 8% (ironically they said that if we didn't pass it, we'd see 10%), instead we have about 10% with no end in sight, with the real unemployment probably at 16% or more in some places.
 
"“Where did the financial crisis begin? Which central bank conducted monetary policy that was too loose? Which country went down the wrong path of social policy by encouraging low income households to take on mortgage loans that they can never pay back? Who in the year 2000 weakened regulations limiting investment bank leverage ratios, let Lehman Brothers collapse in 2008 and thereby tipped world financial markets into chaos?” he wrote."

Danged straight...
 
Damocles said:
However, we all do remember hearing that it would "peak" at 8% (ironically they said that if we didn't pass it, we'd see 10%), instead we have about 10% with no end in sight, with the real unemployment probably at 16% or more in some places.
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I have always said that was a stupid figure to throw out there. You & I & everyone else knew that was a crazily rosy figure.

This isn't even about "defending the admin." Philisophically, I agree with the idea that - when corporations stop spending & hiring, and consumers aren't spending - there has to be an influx of spending from somewhere to get things moving again. And frankly, though I know we're not out of the woods, I'm actually fairly happy with how things have progressed over the past year.

We could debate for hours about the economy & its current prospects, but I don't think anyone can ever convince me that the strategy most conservatives were advocating at the time of the stimulus would have us in a better place right now. In fact, most of its proponents on this board conceded that there would have been a much higher level of "creative destruction," which would have likely set the economy much further back in the short-term. Chances are very good that we'd be in a much worse place today w/ that strategy.
 
Onceler said:
I have always said that was a stupid figure to throw out there. You & I & everyone else knew that was a crazily rosy figure.

This isn't even about "defending the admin." Philisophically, I agree with the idea that - when corporations stop spending & hiring, and consumers aren't spending - there has to be an influx of spending from somewhere to get things moving again. And frankly, though I know we're not out of the woods, I'm actually fairly happy with how things have progressed over the past year.


The very reason you're a peckerhead....ignorance and a blind follower


We could debate for hours about the economy & its current prospects, but I don't think anyone can ever convince me that the strategy most conservatives were advocating at the time of the stimulus would have us in a better place right now. In fact, most of its proponents on this board conceded that there would have been a much higher level of "creative destruction," which would have likely set the economy much further back in the short-term. Chances are very good that we'd be in a much worse place today w/ that strategy.
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,
 
bravo said:
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Bravo - you're a fairly partisan, angry guy, but do you really think cutting taxes, with no stimulus or bailouts at all, would have had the economy in a better place right now?

You say we can't speculate, but I can: if that had happened, there is an outside shot that maybe - MAYBE - 10 years down the line, we'd be in a better place, particularly with debt.

But in the short-term - and by that, I mean 3-4 years out - many more companies would have failed. The initial layoff period would have been deeper & more prolonged, and we'd probably see a stock market down around the 5-6,000 level. Consumer spending would have been restricted even more because of the higher unemployment figure, which would have hurt more companies, and discouraged hiring at an even greater level.

We wouldn't be in a better place today. Again, you can make the argument that we might have been a decade down the line, but to try to argue we'd be better off today would just be admitting a knowledge deficit on economics.
 
Onceler said:
I actually can't stand Krugman, but how is it "obvious" that the stimulus has "failed"?

That's really a completely premature, and in my opinion, uninformed conclusion. I don't recall anyone saying that stimulus would have us back to the same employment levels in a little over a year (cue googlers finding one quote from one guy saying something remotely close to that).

I don't think it's failed. I think without it, we'd still be in a deep depression.
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The stimulus worked in the sense that it was a stop gap, the way the spending was done the problem was stabilized and pushed back in time. We are now coming to the point where the housing credit is gone, cash for clunkers is gone, the states are back to begging for more federal handouts to protect union employees jobs etc...

The stimulus failed in that it did NOTHING to promote long term job growth in this country. They KNEW it wouldn't and therefore went around proclaiming the number of 'jobs saved' and pretending that EVERY infrastructure job was being paid for by the stimulus. Anyone else note in their areas that infrastructure projects started PRIOR to 2008 now have 'paid for by the stimulus bill' (actually says Community reinvestment act) signs on them?

As I have stated many times.... some of the stop gaps were necessary. Some were not. The pace of the spending was poor. It should have been more front end loaded and it should have been more money pumped into infrastructure build out (and no... that doesn't mean stamping anything that had already been going on with a 'we did this' sign)
 
Onceler said:
I have always said that was a stupid figure to throw out there. You & I & everyone else knew that was a crazily rosy figure.

This isn't even about "defending the admin." Philisophically, I agree with the idea that - when corporations stop spending & hiring, and consumers aren't spending - there has to be an influx of spending from somewhere to get things moving again. And frankly, though I know we're not out of the woods, I'm actually fairly happy with how things have progressed over the past year.

We could debate for hours about the economy & its current prospects, but I don't think anyone can ever convince me that the strategy most conservatives were advocating at the time of the stimulus would have us in a better place right now. In fact, most of its proponents on this board conceded that there would have been a much higher level of "creative destruction," which would have likely set the economy much further back in the short-term. Chances are very good that we'd be in a much worse place today w/ that strategy.
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The Stimulus was misfired at jobs that simply do not last. Incentivize hiring in small business with tax breaks rather than attempt to hire everybody they aren't into temporary jobs in government (I mean when the last jobs report had 400,000, exaggerated number BTW, temporary Census jobs and only 40,000 private sector jobs, come on)...

Instead we get targeted spending that was ill-designed to improve things just at election cycles, there was supposed to be this website that kept track of every dime... Not doing so well. This isn't a path to recovery. Those temp government jobs really won't last, and because we refuse to create an environment where the private sector can do well (instead working to pass tax and cap and other crippling taxes just when we need to control our urge to punish success...

On a side note: Does anybody remember that Obama was going to have every single law he was going to sign online for 48 hours so we can know what was in them? What happened to that? I mean he signs banking "reform" without even a public discussion?
 
Honestly, I'm not sure why you had the impression that the created jobs were going to be mainly "permanent." Even infrastructure, "shovel-ready" kinds of jobs are by their very nature temporary. In my mind, that was actually the idea.

The government is not in the business of, nor do they have much ability, to create "permanent" jobs for people.

The idea, as I understood it, was to get people working & spending again. As people work & spend more, business & industry does better - enabling business & industry to hire more. Now, those jobs are what are considered more along the lines of "permanent employment."

And, frankly, that's kind of what is transpiring. The slowdown now is confidence - in the market, and by extension, in business. But the idea was never to have the government create permanent work for most of the jobs they were talking about.
 
Onceler said:
Honestly, I'm not sure why you had the impression that the created jobs were going to be mainly "permanent." Even infrastructure, "shovel-ready" kinds of jobs are by their very nature temporary. In my mind, that was actually the idea.

The government is not in the business of, nor do they have much ability, to create "permanent" jobs for people.

The idea, as I understood it, was to get people working & spending again. As people work & spend more, business & industry does better - enabling business & industry to hire more. Now, those jobs are what are considered more along the lines of "permanent employment."

And, frankly, that's kind of what is transpiring. The slowdown now is confidence - in the market, and by extension, in business. But the idea was never to have the government create permanent work for most of the jobs they were talking about.
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If I get a job with a construction company making roads, while the road may be completed at some point there is a very good chance that I can stay with the company and do work for further projects. If I get a transitory job with the Census there is almost zero chance that there will be further projects. There is a huge difference between growth in the private sector and in the census. To sing the awesomeness of your job creating skills just before these people lose their jobs when the project is over is a bit foolish.
 
Damocles said:
The Stimulus was misfired at jobs that simply do not last. Incentivize hiring in small business with tax breaks rather than attempt to hire everybody they aren't into temporary jobs in government (I mean when the last jobs report had 400,000, exaggerated number BTW, temporary Census jobs and only 40,000 private sector jobs, come on)...

Instead we get targeted spending that was ill-designed to improve things just at election cycles, there was supposed to be this website that kept track of every dime... Not doing so well. This isn't a path to recovery. Those temp government jobs really won't last, and because we refuse to create an environment where the private sector can do well (instead working to pass tax and cap and other crippling taxes just when we need to control our urge to punish success...

On a side note: Does anybody remember that Obama was going to have every single law he was going to sign online for 48 hours so we can know what was in them? What happened to that? I mean he signs banking "reform" without even a public discussion?
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Correct me if I'm wrong, but I'm led to believe that a lot of the money hasn't been spent.

Also, didn't unions, public and privet get bailed out. (auto, teachers, states, etc) I guess they want to suggest that these were the jobs that were saved. Jobs that needed to be cut.

And what about ACORN. They were going to get over $8,000,000,000.00 before their criminal organization was exposed.

Some real job creation here. (Let me tell you.) All at the exspense of the privet sector.

In Obamas world, if you're in the privet sector, you aint crap.

All you Obama worshipers answer me this; how does over $8,000,000,000.00 to ACORN creat jobs?

Also, who's going to feed you when the privet sector dies, or moves out of the country. Which is where my company is going.
 
I'd urge anyone to go to recovery.org to research what the stimulus has really been spent on.

There seem to be a lot of misconceptions, and a lot of what I read tends to be rehashed talking points from talk radio, who tend to the the loudest voices as well as the most pervasive spreaders of misinformation.

There were tax breaks for small business. There were also plenty of construction jobs. The government doesn't have the ability to "create" private sector jobs directly. If they did, then they would truly be socialist.
 
Onceler said:
I'd urge anyone to go to recovery.org to research what the stimulus has really been spent on.

There seem to be a lot of misconceptions, and a lot of what I read tends to be rehashed talking points from talk radio, who tend to the the loudest voices as well as the most pervasive spreaders of misinformation.

There were tax breaks for small business. There were also plenty of construction jobs. The government doesn't have the ability to "create" private sector jobs directly. If they did, then they would truly be socialist.
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How does over $8,000,000,000.00 to ACORN creat jobs?

Is this part of the stimulus ok in your eyes?
 
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