Tuesday, 15 July 2014

Paul Krugman disgraced?

Which of these following statements is true:

a.Paul Krugman is a Nobel Prize winner.
b. Paul Krugman called for a housing bubble to fix the economy in 2002, and fro a space aliens to fix the economy in 2011.
c. Paul Krugman is the most prominent economist today calling for massive money printing and government over-spending .
d. Paul Krugman is leaving Princeton university in “quiet disgrace.”

Actually, that’s a trick question. If a report coming out of the States today is correct, all of the above statements are true. The report asks, Is Paul Krugman Leaving Princeton In Quiet Disgrace?:

Professor Paul Krugman is leaving Princeton.  Is he leaving in disgrace?

Not long, as these things go, before his departure was announced Krugman thoroughly was indicted and publicly eviscerated for intellectual dishonesty by Harvard’s Niall Ferguson in a hard-hitting three-part series in the Huffington Post, beginning here, [part 2 here, part 3 here] and with a coda in Project Syndicate, all summarized at Forbes.com.  Ferguson, on Krugman:

Where I come from … we do not fear bullies. We despise them. And we do so because we understand that what motivates their bullying is a deep sense of insecurity. Unfortunately for Krugtron the Invincible, his ultimate nightmare has just become a reality. By applying the methods of the historian – by quoting and contextualizing his own published words – I believe I have now made him what he richly deserves to be: a figure of fun, whose predictions (and proscriptions) no one should ever again take seriously.

Princeton, according to Bloomberg News, acknowledged Krugman’s departure with an extraordinarily tepid comment by a spokesperson. “He’s been a valued member of our faculty and we appreciate his 14 years at Princeton.”

Not the rousing send-off you’d expect when your flagship academic departs your hallowed walls, especially not when “the revered Paul Volcker, himself a Princeton alumni,” kicks him in the arse as he’s heading out:

To the Daily Princetonian (later reprised by the Wall Street Journal, Volcker stated with refreshing bluntness:

The responsibility of any central bank is price stability. … They ought to make sure that they are making policies that are convincing to the public and to the markets that they’re not going to tolerate inflation.

This was followed by a show-stopping statement:  “This kind of stuff that you’re being taught at Princeton disturbs me.” Taught at Princeton by … whom? Paul Krugman, perhaps?  Krugman, last year, wrote an op-ed for the New York Times entitled  Not Enough Inflation.  It betrayed an extremely louche, at best, attitude toward inflation’s insidious dangers. Smoking gun?

Volcker’s comment, in full context:

The responsibility of the government is to have a stable currency. This kind of stuff that you’re being taught at Princeton disturbs me. Your teachers must be telling you that if you’ve got expected inflation, then everybody adjusts and then it’s OK. Is that what they’re telling you? Where did the question come from?

Is Krugman leaving in disgrace? Krugman really is a disgrace … both to Princeton and to the principle of monetary integrity.

The sad news is, he will continue writing nonsense at The New York Times.


  1. How to be polite and intelligent if there's a writing about Mr Krugman. I have read the book the concsience of an liberal (or the like) and it was a catastrophy. And still there are others which do follow him straight, most prominent Mr Piketty, I bet Krugman and Piketty will be the "duo infernale" in the near future.

    So now I try ot be more "intelligent". So let me ask just one question. Am I wealthier if I do have today 100 Money Units and tomorrow 200 Money Units?

    If that is not the case, why is is a difference if I'm "just" talking about 200 money units.

    But I also can not say anything intelligent about: "The responsibility of the government is to have a stable currency." It's just stupid to the bone.

    Government is the "money dictator" and it has prohibited any market for money. So how could one expect anything goog come from it?

  2. This Niall Ferguson?



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