Did I miss the part where he proved temporary tax cuts are worse than temporary government spending?

Krugman is without a doubt a technically proficient economist, but these little blurbs he's been punching out for the New York Times are not economics. They're barely coherent argument- just snide one-liners and unbacked assertions. If he were to publish this tripe in some kind of journal or on a professional economics site instead of getting paid by the New York Times, his academic peers would be insulted by the bold claims with zero substance. I have yet to see him engage anything resembling a serious conversation about the ideas he attacks, rather than drive-by torching of strawmen that are twisted beyond recognition. He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

This ought to be a reasoned, civil discussion.

Churchill2004: Krugman is without a doubt a technically proficient economist, but these little blurbs he's been punching out for the New York Times are not economics. They're barely coherent argument- just snide one-liners and unbacked assertions. If he were to publish this tripe in some kind of journal or on a professional economics site instead of getting paid by the New York Times, his academic peers would be insulted by the bold claims with zero substance. I have yet to see him engage anything resembling a serious conversation about the ideas he attacks, rather than drive-by torching of strawmen that are twisted beyond recognition. He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

It's like he's a Fark Economist.

It makes sense, though.

Churchill2004: He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

Translation: I can't argue the issues, so I'll just slander the guy.

/your butthurt comforts me

Flatulent_Flea: Translation: I can't argue the issues, so I'll just slander the guy.

/your butthurt comforts me

You follow well in the ways of your intellectually dishonest master, who just the other day said that you should never listen to anyone opposing the magic money cannon. Go critical thinking!

Flatulent_Flea: Churchill2004: He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

Translation: I can't argue the issues, so I'll just slander the guy.

/your butthurt comforts me

And, yet, rather than post a substantive rebuttal to drive the point home, you went with "butthurt." So, you really just did exactly the same thing you criticized him for doing.

It's interesting how we all of a sudden started hearing talking heads biatch about a return to Keynesian economics once Obama sat in the big chair. Where were they when Bush proposed the other stimuli?

If you ask me, a bit of Keynes and a bit of Hayek together make for a better economy than full on in either direction.

/b-b-b-b-but Bush!

Churchill2004: who just the other day said that you should never listen to anyone opposing the magic money cannon.

And he was right when he said it. The people that claim that tax cuts are better than direct spending by the government to stimulate this economy are intellectually dishonest, or incompetent.

Churchill2004: Krugman is without a doubt a technically proficient economist, but these little blurbs he's been punching out for the New York Times are not economics. They're barely coherent argument- just snide one-liners and unbacked assertions. If he were to publish this tripe in some kind of journal or on a professional economics site instead of getting paid by the New York Times, his academic peers would be insulted by the bold claims with zero substance. I have yet to see him engage anything resembling a serious conversation about the ideas he attacks, rather than drive-by torching of strawmen that are twisted beyond recognition. He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

This just in- academics sum up their arguments to the meat and implications when speaking to the general public who have little background knowledge of the subject and lack the technical proficiency to understand detailed academic journals.

I don't usually agree with this, as I think newspapers should strive for higher academic standards, but it's not his fault the NYT wants him to publish that way. I'm sure he would love to go into detailed viewpoints- most economists do. The reality- no one would listen to/read his column.

Churchill2004 but these little blurbs he's been punching out for the New York Times are not economics.


how fortunate that mr. krugman has anonymous internet commentors to inform him when he is and is not performing economic analysis. as a nobel prize winning economist, he is probably not always clear on this point.

Dinki: And he was right when he said it. The people that claim that tax cuts are better than direct spending by the government to stimulate this economy are intellectually dishonest, or incompetent

And this is how closed-minded groupthink works. It's much easier to poison the well by defining the range of acceptable disagreement as artificially narrow than it is to actually engage and discredit specific arguments and theories.

sloppy shoes: This just in- academics sum up their arguments to the meat and implications when speaking to the general public who have little background knowledge of the subject and lack the technical proficiency to understand detailed academic journals

Obviously. But it's going out under his name because his name carries the weight of being recognized by those higher standards, even if what he's writing is little more than the same old partisan hackery any Rove-drone could pump out, except with a focus on economic-minded foes of his political agenda.

Paul Krugman did not "use" Milton Friedman's economic theories to "explain" anything, as the headline claims. He started with the rather bizzare conflation of whether or not a spending program is permanent and whether or not it's paid for with taxes or debt, which he claimed meant that short-term spending really is more stimulating than tax cuts because people don't know taxes are going to go up. Oh, and as every economist knows, it's cheaper to borrow than pay as you go because interest on a loan is spread out over a longer period of time. It's an absurdly incoherent non-argument.

Relax, it was a lousy column. They happen. I don't know how to fix the economy. I'm glad some people think they do. I hope they're right.

flavor of the month: Churchill2004 but these little blurbs he's been punching out for the New York Times are not economics.


how fortunate that mr. krugman has anonymous internet commentors to inform him when he is and is not performing economic analysis. as a nobel prize winning economist, he is probably not always clear on this point.

I'm sorry, I was under the impression that this site is for comments and discussion. I'll inform Drew of your revelation than the subject of every link does not spend time reading and contemplating the ensuring FARK thread. No doubt he will rush to take down the site before someone is offended by our plebian ramblings.

Churchill2004: And this is how closed-minded groupthink works. It's much easier to poison the well by defining the range of acceptable disagreement as artificially narrow than it is to actually engage and discredit specific arguments and theories.

And how is this not what you are doing?

Churchill2004: Paul Krugman did not "use" Milton Friedman's economic theories to "explain" anything, as the headline claims. He started with the rather bizzare conflation of whether or not a spending program is permanent and whether or not it's paid for with taxes or debt, which he claimed meant that short-term spending really is more stimulating than tax cuts because people don't know taxes are going to go up. Oh, and as every economist knows, it's cheaper to borrow than pay as you go because interest on a loan is spread out over a longer period of time. It's an absurdly incoherent non-argument.

Actually, it makes sense. I think you missed the point of his argument. I'm kind of confused as to what you don't understand.

Churchill2004: who just the other day said that you should never listen to anyone opposing the magic money cannon. Go critical thinking!

I don't regularly read blogs, but I tried to look for that column out of curiosity. Where did he say it?

I defy Mr. Krugman to point to any government spending program that has ever been "temporary."

Well, I'm the love child of Ayn Rand and Murray Rothbard, so I'm really getting a kick out of these replies.

/got nothin'

When Krugman posted this, I decided I could no longer take him seriously.

Milton Friedman was a stupid c*nt!

So how do we go about deciding who is right in these debates ? Clearly it can't be based upon observing actual results, or else the people who have been in charge would never have the balls to keep offering suggestions.

dillenger69: If you ask me, a bit of Keynes and a bit of Hayek together make for a better economy than full on in either direction.

I'll let Hayek stimulate my package.



/tits

Churchill2004: Krugman is without a doubt a technically proficient economist, but these little blurbs he's been punching out for the New York Times are not economics. They're barely coherent argument- just snide one-liners and unbacked assertions. If he were to publish this tripe in some kind of journal or on a professional economics site instead of getting paid by the New York Times, his academic peers would be insulted by the bold claims with zero substance. I have yet to see him engage anything resembling a serious conversation about the ideas he attacks, rather than drive-by torching of strawmen that are twisted beyond recognition. He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

These remarks are based on exactly WHAT differential qualifications in the field of economics that YOU have that Krugman doesn't? What makes you qualified to comment on what is appropriate for academic economic journals? What suggests that YOU know Friedman's theories and their strengths and weaknesses better than either Krugman or actual academic economists do?

Perhaps your disagreeing with him despite a near-total ignorance of academic economics is the real partisan hackery.

Mordant: So how do we go about deciding who is right in these debates ? Clearly it can't be based upon observing actual results, or else the people who have been in charge would never have the balls to keep offering suggestions.

Tie them to big heavy wooden stakes and throw them into a pond. If they survive then they were right.

You don't ned economic theory or other fairy-tales to see the sense of this. Just look at how America fared during and after the Civil War: big government spending during the war, Golden Age of Capitalism afterwards.

For that matter, how do you think Germany, Italy and Japan got themselves out of the Great Depression? And then Britain, followed at last by formerly neutral America?

We'd have gotten out of it sooner had Roosevelt spent big government bucks on building up the navy and air force, instead of commie shiat like the CCC and WPA.

oldebayer: You don't ned economic theory or other fairy-tales to see the sense of this. Just look at how America fared during and after the Civil War: big government spending during the war, Golden Age of Capitalism afterwards.

For that matter, how do you think Germany, Italy and Japan got themselves out of the Great Depression? And then Britain, followed at last by formerly neutral America?

We'd have gotten out of it sooner had Roosevelt spent big government bucks on building up the navy and air force, instead of commie shiat like the CCC and WPA.

I'm not really even sure where to start on this, so I'm just going to facepalm repeatedly until all my features are erased.

PoopStain: It doesn't have to be one or the other, now does it?

When you are talking about stimulus, especially in the context of our current situation, Spending is much faster and more reliable than tax cuts. Spending can be focused, and you can be assured that it is actually going into the economy. Tax cuts are unfocused, and much of it would be saved not spent.

I was under the impression that it was imperative to use government spending and certain specific tax cuts to help the economy. Doing something that involved 100% tax cuts or 100% government spending on public works projects were both equally bad. Also, it seems as though most economists, while disagreeing on a whole host of issues, saw the need for government spending at times like this as compared to widespread tax cuts that wouldn't really give the direct impact needed.

But, hey, I'm sure there's a way to argue about this for a few more months.

I keep hearing Krugman's status as a Nobel Prize winner automatically validates any point of view he happens to blurt out. Why? Economics is one of the humanities. All the Nobel Prize in one of the humanities means is that some number of European hippies really wanted to give him some money.

Capitalist1: I keep hearing Krugman's status as a Nobel Prize winner automatically validates any point of view he happens to blurt out. Why? Economics is one of the humanities. All the Nobel Prize in one of the humanities means is that some number of European hippies really wanted to give him some money.

So we should bow down to the knowledge you see fit to bestow upon us, right?

Implicit in the arguments that the stimulus bill is 'good' is that the bill itself is actually stimulus and will be spent on projects that 1) create jobs at a reasonably cost-effective rate and 2) provide some lasting social good beyond the short term employment boost.

The trouble is that even if you accept that stimulus (ie govt spending) is an effective method of creating jobs and lasting social value, the bill itself isn't stimulus. Infrastructure spending over the next 3 years comes in at something like 12 cents on the dollar; the number is even less if you only count projects that will hire people in the next 12 months.

A big chunk of the 'stimulus' is actually income redistribution. Regardless of what you think of the overall merit of these programs (EITC, etc) they aren't job-creating stimulus anymore than Bush's oft-derided checks from the treasury were.

Will any of this matter? not really since the gravy train is going to happen no matter what, the only real question is how protectionistic it is going to be. When the economy recovers, even if it has more to do with monetary policy (which takes around a year to work through the economy) than fiscal policy, Saint Obama is going to get the praise from Krugman, the Times and most everyone else. Any delays in the recovery will just get blamed on Bush and be pointed to as evidence of just how bad he farked things up.

bronyaur1: Perhaps your disagreeing with him despite a near-total ignorance of academic economics is the real partisan hackery.

Ooo, should be fun. Good luck battling the simplistic libertarian whargabble to follow.

/grabs popcorn

Bek: I'm not really even sure where to start on this

Then why announce to all and sundry how inarticulate you are? Maybe think harder, and get some ideas?

Nabb1: Flatulent_Flea: Churchill2004: He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

Translation: I can't argue the issues, so I'll just slander the guy.

/your butthurt comforts me

And, yet, rather than post a substantive rebuttal to drive the point home, you went with "butthurt." So, you really just did exactly the same thing you criticized him for doing.

Rebuttal of what? He didn't have a point other than to slander Krugman because he's a liberal and his economic advice goes against Republican dogma.

What's good for the goose is good for the gander, etc.

Ryan2065: Did I miss the part where he proved temporary tax cuts are worse than temporary government spending?

If you understood anything about economics you would realize one is good during deflation and one is good during inflation.

Krugamans argument basically boiled down to "The Obama says so".

MasterThief: I defy Mr. Krugman to point to any government spending program that has ever been "temporary."

On the other hand I defy you to point to tax cuts that have been "temporary".

Capitalist1: I keep hearing Krugman's status as a Nobel Prize winner automatically validates any point of view he happens to blurt out. Why? Economics is one of the humanities. All the Nobel Prize in one of the humanities means is that some number of European hippies really wanted to give him some money.

Your use of hippie kinda invalidates any "valid" complaint you may have.

First off, he is talking about temporary spending increases, not permanent ones - in fact, he even says that permanent ones will hurt in the long run. If anything, he's saying that the Iraq spending won't hurt us - although, of course, being Krugman we know he is talking about the recent stimulus.

And he's also not saying that tax cuts aren't effective in the long or short run, but rather that an increase in spending is more effective in the short term.

The fact of the matter is - and I say this with all respect to Krugman, for he is a very brilliant mind - Economics is not a precise science. An economic theory holds less water than any other scientific theory because it is based on models that make assumptions that are not entirely accurate to real life and many which do not take into account all possible influences on the market (for the sake of simplicity).

This is because it is impossible for economists to test theories - you cannot just manhandle an economy to see how people react. So instead, economists take a look at past data and try to figure out what caused certain changes. But hindsight isn't always 20/20 - the further you get away from an event, the less of a picture you have of what went on during that event. What external and internal influences that may have caused the markets to act differently than expected - and it is anything but cut and dry explainations.

A tax cut in 2006 is going to act differently than a tax cut in 2009. Extra spending is going to help sometimes, and sometimes it will hurt. There is no way to completely predict the effects of ANY fiscal policy. There is just no way around it - there is no blanket model that covers all situations, all events.

So anytime an economist says "economic theory states...", you're going to have to take it with a grain of salt if it's an especially controversial topic like this. You can take economic theory, and a set of data from the past, and make almost any idea seem plausible to the current situation. The reason why it is controversial because no economist has a damn clue, and won't until the event is long over. And even then, the situations surrounding it may be so convoluted no one will be able to make heads or tails of it. Just look at the Depression - we have lots of ideas, some of them very good ones, but damned if anyone actually knows what exactly caused the stock markets to crash, and for the Depression to be as bad as it was.

Not to say we shouldn't listen to economists - they still have some very good ideas, and some very great reasons for those good ideas. Just never accept a blanket statement, especially when it comes to partisan issues - if it's partisan, it means no one really knows for sure.

Atheist_Republican: First off, he is talking about temporary spending increases, not permanent ones - in fact, he even says that permanent ones will hurt in the long run. If anything, he's saying that the Iraq spending won't hurt us - although, of course, being Krugman we know he is talking about the recent stimulus.

And he's also not saying that tax cuts aren't effective in the long or short run, but rather that an increase in spending is more effective in the short term.

The fact of the matter is - and I say this with all respect to Krugman, for he is a very brilliant mind - Economics is not a precise science. An economic theory holds less water than any other scientific theory because it is based on models that make assumptions that are not entirely accurate to real life and many which do not take into account all possible influences on the market (for the sake of simplicity).

This is because it is impossible for economists to test theories - you cannot just manhandle an economy to see how people react. So instead, economists take a look at past data and try to figure out what caused certain changes. But hindsight isn't always 20/20 - the further you get away from an event, the less of a picture you have of what went on during that event. What external and internal influences that may have caused the markets to act differently than expected - and it is anything but cut and dry explainations.

A tax cut in 2006 is going to act differently than a tax cut in 2009. Extra spending is going to help sometimes, and sometimes it will hurt. There is no way to completely predict the effects of ANY fiscal policy. There is just no way around it - there is no blanket model that covers all situations, all events.

So anytime an economist says "economic theory states...", you're going to have to take it with a grain of salt if it's an especially controversial topic like this. You can take economic theory, and a set of data from the past, and make almost any idea seem plausible to the current situation. The reason why it is controversial because no economist has a damn clue, and won't until the event is long over. And even then, the situations surrounding it may be so convoluted no one will be able to make heads or tails of it. Just look at the Depression - we have lots of ideas, some of them very good ones, but damned if anyone actually knows what exactly caused the stock markets to crash, and for the Depression to be as bad as it was.

Not to say we shouldn't listen to economists - they still have some very good ideas, and some very great reasons for those good ideas. Just never accept a blanket statement, especially when it comes to partisan issues - if it's partisan, it means no one really knows for sure.

He is going Keynsian...meaning balance and spending and saving spurts, depending on the economy. He is being smart.

The right hates Keynes though because he advocated tax increases at certain times.

Sabyen91:
He is going Keynsian...meaning balance and spending and saving spurts, depending on the economy. He is being smart.

I'm not saying he isn't being smart about it. I would agree that short-term spending increases (without increasing taxes) are not such a bad thing. And I also agree that there are times when you do need to increase taxes.

My point was twofold: he was talking about temporary increase, not permanent - secondly, that at the end of the day, no matter what your partisan feelings are on the matter, no one really knows what will happen. That is the magic and mystery of economics. You can have a good idea, but it isn't hard science. It is fickle and unpredictable. And the damning thing about it is that public perception of the economy probably affects the economy more than any fiscal or monetary policy the government could even dream up.

If the public thinks the fiscal policy is a bad one, they will make it a bad one. And the same goes in the opposite.

Friedman economic theory disenfranchises the poor, destroys the middle class, and leads to unabashed corporatism. Anyone who pushes it should be soundly swatted.

Atheist_Republican: Sabyen91:
He is going Keynsian...meaning balance and spending and saving spurts, depending on the economy. He is being smart.

I'm not saying he isn't being smart about it. I would agree that short-term spending increases (without increasing taxes) are not such a bad thing. And I also agree that there are times when you do need to increase taxes.

My point was twofold: he was talking about temporary increase, not permanent - secondly, that at the end of the day, no matter what your partisan feelings are on the matter, no one really knows what will happen. That is the magic and mystery of economics. You can have a good idea, but it isn't hard science. It is fickle and unpredictable. And the damning thing about it is that public perception of the economy probably affects the economy more than any fiscal or monetary policy the government could even dream up.

If the public thinks the fiscal policy is a bad one, they will make it a bad one. And the same goes in the opposite.

I was not disagreeing with you or with the approach. Keynes was a smart man. And he would agree with spending right now.

unyon: Friedman economic theory disenfranchises the poor, destroys the middle class, and leads to unabashed corporatism. Anyone who pushes it should be soundly swatted.

Friedman was a farking toad.

I noticed something intersting.

A person on the right will see a rich person and think "If I work hard and am smart with my money, I could be him someday"

A person on the left will see a rich person and think "He only got rich because he stole that money of other people. We should confiscate his money and put it into social programs".

Churchill2004: Krugman is without a doubt a technically proficient economist, but these little blurbs he's been punching out for the New York Times are not economics. They're barely coherent argument- just snide one-liners and unbacked assertions. If he were to publish this tripe in some kind of journal or on a professional economics site instead of getting paid by the New York Times, his academic peers would be insulted by the bold claims with zero substance. I have yet to see him engage anything resembling a serious conversation about the ideas he attacks, rather than drive-by torching of strawmen that are twisted beyond recognition. He simply ignores any argument he wants in order to paint whatever picture he wants- typically justifying whatever political agenda his partisan hackery leads him to support.

Mr. Krugman has written or edited around twenty books on Economics including the leading textbooks of the day, hundreds of articles in various mediums, scores of papers in scholastic journals and has of course won a Nobel for his work on New Trade Theory. He has worked or written for most of the great universities in the land and at the moment is he is a professor of economics and international affairs at Princeton University and his on several international economic boards and think tanks.

In his spare time Mr. Krugman likes to drop a few pearls of wisdom on us plebeians with his little pop economics lectures in Slate, Fortune Magazine or the NY Times.

Now Churchill2004 my petulant fellow plebe, you seem more than a little put out that Mr. Krugman hasn't seen fit to put his entire lifetime output of economic wisdom into his most recent New York Times column for our edification in order to prove the little moot point he makes that "cutting taxes in a recession isn't as effective as increasing spending is mmmkay?"

All the arguments of his you need for any of the conclusions he makes in his columns are here (pops like Britney Spear's hymen)

Paul Krugman did not "use" Milton Friedman's economic theories to "explain" anything, as the headline claims. He started with the rather bizzare conflation of whether or not a spending program is permanent and whether or not it's paid for with taxes or debt, which he claimed meant that short-term spending really is more stimulating than tax cuts because people don't know taxes are going to go up. Oh, and as every economist knows, it's cheaper to borrow than pay as you go because interest on a loan is spread out over a longer period of time. It's an absurdly incoherent non-argument.

All he claimed is that any increase in government spending program would be more effective if the taxpayer knew it was only going to be temporary and therefore would not make any long term adjustments to compensate such as they would for a permanent spending increase.

Pretty simple really and that is the opposite of the result for a temporary tax cut where the taxpayer would compensate by saving instead of spending because they knew that taxes would soon increase again.

Simple really, a small column to present a small idea. Too bad your ideology got in the way of you grasping it.

Krugman's right that a temporary shock to government spending won't crowd out consumption. What deficit spending will do will do is "crowd out" investment.

The real reason government spending "creates jobs" is that people realize that their standard of living will be reduced, as most government spending on goods and services doesn't actually contribute anything to anybody's well-being. So they work harder to try to minimize the blow to their standard of living, and consume less and save more so they can afford to pay higher taxes.

A temporary shock to government spending won't increase future tax burdens much. People don't feel much poorer, so consumption won't fall by very much or saving rise much, but by the same token employment won't rise very much, and neither will GDP. If people don't work any harder or save more, a temporary deficit will be financed by the savings that would normally have paid for private investment. Interest rates will rise and investment will fall.

In neither case will people's living standards rise. The surest way to do that would be to repudiate government debt, end spending on pointless wars and ineffective and unnecessary welfare programs, and reduce taxes to a bare minimum.

/Economics PhD

Swampthing in Korea: I noticed something intersting.

A person on the right will see a rich person and think "If I work hard and am smart with my money, I could be him someday"

A person on the left will see a rich person and think "He only got rich because he stole that money of other people. We should confiscate his money and put it into social programs".

You know what? That USED to be the American dream. Now it is whoa, I know that dude, I bet he gives me a no bid contract. The American Dream is dead because of you farkers.

Swampthing in Korea: I noticed something intersting.

If you ever actually noticed anything, it would be a goddamn miracle.