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Wednesday, June 26, 2013

'Karicature Keynesianism'

Paul Krugman is tired of the Karicatures:

Karicature Keynesianism: Via Brad DeLong, Daniel Kuehn protests a really stupid argument by Stephen Landsburg; he does the work, and no need for me to follow up.
But let me note that Landsburg’s latest unfortunate intervention follows a well-trodden path: that of starting from the proposition that Keynesians are themselves really, really stupid — a proposition argued not by pointing to anything actual Keynesians say, but instead by presenting a caricature that supposedly is what Keynesians believe. Call it Karicature Keynesianism.
Anyone who’s followed the various attacks on yours truly knows what I mean: Keynesians believe that budget deficits never matter, that increasing demand can solve all economic problems, that there’s no such thing as a supply side to the economy, that more spending is always good. You can see it even in the comments to Kuehn’s post, with people expressing doubt about whether there’s crowding out in my textbook. Let me suggest a very difficult research project: how about actually looking at the book?
Now, to some extent Karicature Keynesianism involves extrapolating what people like me say about policy in a depressed economy with interest rates up against the zero lower bound and pretending that this is what we say in all situations. But where’s this urge to caricature coming from?
I’d say that it’s actually a form a flattery. If Keynesians had made a lot of bad predictions in recent years — if inflation or interest rates had soared, if austerity had produced prosperity — the other side could go after what we actually said and say. But reality, it turns out, has a well-known Keynesian bias. So the people who’ve gotten everything wrong are reduced to attacking an economic doctrine that has worked pretty well by misrepresenting that doctrine, and claiming that it’s stupid and absurd. ...

Let me follow-up on the point about predictions. A relatively well known economist who recently started a blog said he has a formula for getting things right -- just take the opposite side of Krugman on any issue ("to take the correct stand on any issue I need only learn Krugman's, and take the opposite"). What's remarkable about his statement is that Krugman got it basically right. Not in every instance or every detail, but far, far more than most.

So what we have is someone who is supposed to be a credible voice implicitly telling readers to believe those who were wrong over those who were right (or at least be dismissive of someone who is telling them things they need to know). Why? Because his team disses Krugman. That's what they do. He was probably trying to impress the people in this group, get a little chuckle for his witty (?) remark by playing the bash Krugman game. He and others are supposed to be these data based, scientist types -- that's how they portray themselves -- but the truth is that many of them are anything but. It's a sad reflection of our profession.

    Posted by on Wednesday, June 26, 2013 at 09:17 AM in Economics, Politics | Permalink  Comments (124)


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