22 Jan 2014

I Was Less Than Clear on My Problem With Krugman’s Unemployment Insurance Post

Daniel Kuehn, David R. Henderson, Krugman 73 Comments

[UPDATE below.]

Productively using our time, Daniel Kuehn and I have been arguing at his blog about the recent unpleasantness which resulted in the war-crime of Krugman calling me (and Russ Roberts) “idiots.” (Krugman’s intentional strikethrough raises it from a petty insult into a cool elbow-throw.) So here’s the progression:

(1) Russ Roberts complained that Krugman, in a post about unemployment insurance, led his readers to believe that supply-side arguments against it (such as the ones that the WSJ deployed) were goofy and ignored standard economic theory. This was ironic, since Krugman’s own textbook laid out such supply-side arguments. Russ was very clear that he was NOT accusing Krugman of an outright contradiction:

There’s nothing wrong with arguing that extending unemployment benefits is a good idea. There’s nothing wrong with arguing that extending unemployment benefits might reduce unemployment benefits by increasing aggregate demand. But how do you argue that your opponents are ideologues because they believe the opposite–that paying people to be unemployed increase unemployment when you yourself have conceded that that idea is true? [Bold added by RPM.]

(2) I followed up on Russ’ post, because I wanted to point out precisely how slippery Krugman was being. Krugman made it look like he was trying to be fair and get inside the mind of a person who disagreed that extending UI would create jobs, and the only thing Krugman came up with was “it would increase the deficit.” Krugman didn’t say, “Now of course, a perfectly plausible objection is that there are supply-side incentive issues–I explain this in my textbook. But I happen to think that such effects are swamped right now because of a shortfall of aggregate demand.” No, instead Krugman said the WSJ and Barro were throwing out decades of economic theory and ignoring the “standard view.” Like Russ, I too explicitly made sure to say that the issue was NOT whether someone could think demand-side effects outweighed supply-side ones:

To be sure, a Keynesian like Krugman could argue that in the middle of a big economic slump that such supply-side issues are of only minor importance, and get trumped by demand-side factors. But that’s not at all the argument Krugman is making in this latest blog post. Instead, he is making it sound like Barro et al. are grasping at straws, and not even relying on a coherent argument (such as fear of bigger deficits) when trying to oppose extension of unemployment benefits.

(3) Chris Dillow wanted to weigh in on Krugman’s side, and opened up his post by writing, “Paul Krugman is being accused of hypocrisy for calling for an extension of unemployment benefits when one of his textbooks says “Generous unemployment benefits can increase both structural and frictional unemployment.” (It was Dillow’s post that inspired Krugman to call Russ and me idiots.) No no no, that is obviously not what Russ and I were saying.

(4) David R. Henderson chimed in to explain that Dillow completely missed the boat. Russ Roberts also confirmed that Dillow had missed the point.

(5) So it looks like a pretty open-and-shut case, right? Russ and I both said, in the original posts (i.e. not just after the fact), that we were NOT saying Krugman was forbidden from thinking demand-side considerations could trump supply-side incentive effects. Rather, we were pointing out that he was doing a great disservice to his readers by painting the supply-side perspective as nutty (indeed by not even spelling out what it was). Dillow misstates our complaint, a sharp guy like David R. Henderson uses textual analysis to show Dillow (obviously) misstated it, and then–just for kicks–the original authors (Russ and I) publicly confirm that Dillow misstated our point.

(6) Ah, but now in looking back, I have to be more merciful, because the title I chose for my Mises Canada blog post was, “Krugman Can’t Understand How Someone Could Be So Stupid as to Believe What He Used to Believe.” And in the conclusion I wrote, “Rather, my point is that Krugman frequently accuses his opponents of being stupid and/or evil, when they present a view that he himself advanced in other circumstances.” So, I can see why Dillow thought that I was accusing Krugman of an outright contradiction.

(7) Last thing: Be kind to Daniel Kuehn in the comments, he has been undergoing a sadistic sleep deprivation experiment.

UPDATE: Oh, I can’t believe I forgot: The most unintentionally hilarious epitome of how both sides are talking past each other in this dispute comes from Gene Callahan. In response to David R. Henderson saying that Russ and I were complaining about Krugman disowning the point he had made in his textbook, Gene wrote: “I’m sorry [David], but [Krugman] does not “disown” his previous argument AT ALL: zero, zilch, nada. You have not even shown him mentioning it!”

At this point, I’m not going to explain why Gene’s comment is hilarious. I think everyone who has agreed with Russ and me all along will literally laugh out loud. Everyone who has agreed with Krugman all along will say, “Right on Gene! I can’t believe what idiots these guys are!”

73 Responses to “I Was Less Than Clear on My Problem With Krugman’s Unemployment Insurance Post”

  1. Colonel Serfdom says:

    That really cleared things up. To paraphrase Russ Roberts, it’s disappointing and damaging to economic literacy in this country that Krugman does nothing to talk about tradeoffs and instead encourages magical thinking and slings mud at strawmen.

    • A$$man says:

      Did Major_Freedom change his moniker?

    • Daniel Kuehn says:

      This is PRECISELY the kind of comment that makes everyone think the alleged problem is that people think Krugman ignores the incentive effect.

      Thank you for illustrating, Colonel Serfdom.

  2. Daniel Kuehn says:

    Part of the problem here I think is that we’re not seeing where Krugman called Barro an ideologue.

    Krugman’s problem with Barro was that he was dismissing the Keynesian argument as crazy and inconsistent with the “incentive effect” (or whatever we want to call Krugman’s textbook view). I think this was pretty clear in his post.

    So I think a lot of people are figuring your “calling Barro an ideologue” thing was rhetorical flair and that your main issue is with the textbook point.

    • Daniel Kuehn says:

      I really don’t think you can treat all of us as being crazy like this. You said David gets your point, right? And David said this: “They are astounded, and certainly implicitly accusing him of hypocrisy. for disowning an argument that he himself has made.”

      That’s indistinguishable from what Dillow said you said. So if David gets you, Dillow certainly isn’t wrong because Dillow is saying the same thing.

      Now MAYBE Dillow is presenting an incomplete view of you because he didn’t pick up on the “Krugman says Barro is nutty” part. But this doesn’t move me to a great deal of sympathy for your post here because:

      1. Krugman pretty clearly did not say Barro was nutty for holding the view that he did – he criticized him for how he dismissed the Keynesian view, and

      2. Dillow still got a big part your point as David himself rendered it!!!

      David said the source of the hypocrisy was disowning the incentive effect argument. You think David’s post checks out. You say here you do NOT think Krugman disowned the incentive effect argument (I agree). If you don’t think Krugman is guilty of what David Henderson says was the whole source of the hypocrisy accusation, surely you can’t expect anyone else to take the hypocrisy accusation seriously.

      • Major_Freedom says:

        OT, but really, why should anyone care about what you are and are not “sympathetic” towards? That has nothing to do with truth.

    • Capt. J Parker says:

      I disagree. Krugmans problem with Barro is Barro’s claim that “there is zero evidence that deficit-financed transfers raise GDP and employment” Krugman of you course read this to mean “Nearly everything you (Krugman) know is wrong.” And then the knives came out.

  3. Matt M (Dude Where's My Freedom) says:

    I think anyone who has even a passing interest in economics basically ignores Krugman at this point. His core audience is the layperson who cares significantly more about the great ideological battle between Democrats and Republicans than about seriously understanding human action. What he delivers is basically pop-econ.

    There’s really no reason for him to bother to make these sort of technical qualifications and clarifications in his NY times blog. That’s not what it’s there for. It’s there to convince people to vote for Democrats and support Democratic policies. Sure, people like you will come around and point out how dishonest he’s being, but since when has honesty ever mattered to people who are big fans of partisan politics? As if the average Krugman fan is going to come to Free Advice, read a few posts, and suddenly have a “road to Damascus” moment where they realize they’ve been wrong their entire life?

    • Marty Mazorra says:

      Very well said, and right on point, Matt M.

      Krugman seems to have lost all interest in any empirical support (or lack thereof) for his assertions. Today, as you suggest, it’s all about political support…

  4. Daniel Kuehn says:

    Now that I reread his post, David never even mentions Krugman’s treatment of Barro (although he does quote Krugman talking about Barro).

    He TWICE mentions that Krugman is supposed to have “disowned” the incentive effect argument.

    So why am I misunderstanding something when I say that’s your view and I dispute that by saying that Krugman never disowned the incentive effect?

    Am I wrong in reading you or is David right in reading you? You can’t have both, Bob.

    • Bob Murphy says:

      Daniel I have to move on. If this post doesn’t clarify what Russ and I were trying to say, and why we didn’t think Dillow correctly answered us, then there’s nothing else I can say to clarify.

      If it helps, I will admit that in retrospect, I can see now why Dillow wasn’t being obtuse, and why you are getting exasperated. Everybody brings his own unique twist to this stuff, so yes it’s odd that David is saying Russ is accusing Krugman (implicitly) of hypocrisy, while Russ says he is not accusing Krugman of hypocrisy, and I say David and Russ are on the same page. I have no problem with this outcome, because (in my mind) I know exactly what Russ and David mean, and they mean the same thing. But on the surface, that looks like a flat-out contradiction, so I can see why you think I’m being a pain in the a**.

      • Daniel Kuehn says:

        Well… Russ says he’s worse than a hypocrite :)

        Look in summation I think:

        - David and Dillow both hit on the real heart of the issue.
        - The “Krugman thinks Barro is nutty” point is wrong on its face.
        - The “disowned the incentive effect” point is wrong on its face.
        - The view that expressing the Keynesian view disowns the incentive effect is wrong on its face (and therefore not evidence against my third bullet point).

        It may be that you, Russ, David, etc. are disputing different bullet points above, either insofar as you think that’s not the point or you do think it’s the point but you think my bullet point is wrong. But that’s where I stand.

        • Daniel Kuehn says:

          The heart of the issue that you and Russ were raising!!!!

          I’m not abandoning my point that it’s a sideshow. I was pretty surprised to see David say that the big question was whether Krugman was a hypocrite.

      • Ken B says:

        “I know exactly what Russ and David mean, and they mean the same thing.”

        “[Russ is] implictly accusing him of hypocrisy”

        ” I didn’t accuse Krugman of hypocrisy.”

        One of these things is not like the others, one of these things just doesn’t belong.

        • Daniel Kuehn says:

          What they mean, not what they say ;-)

          • Anonymous says:

            They’re like god that way. Sure He says to kill disbedient children but …

  5. Ken B says:

    Krugman disowned nothing. He accused Barro et al of treating the incentive argument as a slam dunk dispostive argument. Maybe he’s wrong about that, but that’s what he did. Krugman is saying “that’s not even close to the whole story” and Murphy et al read that as Krugman saying “that’s not even any part of the story.” It’s a straight misreading, tendentious and strained as usual, clung to tenaciously as usual.

    Krugman did write a piece that was more advocacy than explanation. That’s worth pointing out, but the umbrage, from some of the most ideological writers in the econosphere, is ironic.

    • Tel says:

      Krugman did write a piece that was more advocacy than explanation.

      Knock me down with a feather.

      Pick any issue Krugman has covered during the Obama Presidency and point out how he carefully covered the good and bad points of each policy option.

  6. Mike Sax says:

    “Productively using our time, Daniel Kuehn and I have been arguing at his blog about the recent unpleasantness which resulted in the war-crime of Krugman calling me (and Russ Roberts) “idiots.”

    Bob you could make a river with so many crocodile tears. You and the other Right wing Krugman haters have never ever called him a name.

    • Major_Freedom says:

      You’re right, this blog needs more ad hominem tu quoque.

  7. Mike Sax says:

    Actually Bob when I look at what Barro did, he did the same thing you claim Krugman is guility of. He didn’t say ‘To be sure, a Keynesian like Krugman could argue that in the middle of a big economic slump that such supply-side issues are of only minor importance, and get trumped by demand-side factors. ”

    but rather he made it sound like anyone who believes in demand side effects believes in some kind of ‘magic.’

    ‘Agriculture Secretary Tom Vilsack said recently that food stamps were an “economic stimulus” and that “every dollar of benefits generates $1.84 in the economy in terms of economic activity.” Many observers may see how this idea—that one can magically get back more than one puts in—conflicts with what I will call “regular economics.” What few know is that there is no meaningful theoretical or empirical support for the Keynesian position.’

    • Daniel Kuehn says:

      Right – this was what Krugman was criticizing Barro for.

      This is why I say that the view that Krugman said Barro was an ideologue or nutty for making a claim he makes on his own textbook was wrong on its face. Krugman quite clearly wrote:

      “But if you follow right-wing talk — by which I mean not Rush Limbaugh but the Wall Street Journal and famous economists like Robert Barro — you see the notion that aid to the unemployed can create jobs dismissed as self-evidently absurd. You think that you can reduce unemployment by paying people not to work? Hahahaha!”

      He was bothered by Barro’s take on the Keynesian view, NOT bothered by the fact that Barro would dare to cite an incentive effect that absolutely everyone agrees is real.

      96% of Krugman criticisms are complete nonsense. I figured that out with a careful quasi-experimental design that includes state-specific time trends.

    • Major_Freedom says:

      This is funny:

      http://krugman.blogs.nytimes.com/2014/01/19/ui-the-nairu-and-the-zlb/?_php=true&_type=blogs&_r=0

      “What’s limiting employment now is lack of demand for the things workers produce. Their incentives to seek work are, for now, irrelevant … And the truth is that unemployment benefits are a good, quick, administratively easy way to increase demand, which is what we really need. So right now they have the effect of reducing unemployment.”

      Apparently, for everyone who is unemployed, giving them UI money to spend on their own consumption will result in them becoming employed. Since it is clearly absurd for one and the same person to be employed by virtue of his own consumption, the notion is that workers consuming UI money collectively will result in more employement offered for workers collectively.

      It’s funny because one of the main reasons why wage rates don’t fall, is because of UI, the very “solution” being presented.

      I don’t think Russ nor Krugman are addressing this.

      • Bob Roddis says:

        For people to be able to engage in exchanges, they need skills necessary to produce valuable goods and services “demanded” by others. Both UI and artificially increasing “demand” through Keynesian policies are nothing but forced transfers of wealth to unemployed people who are the victims previous Keynesian schemes. These transfers are necessarily temporary and unsustainable in the long run. They mislead the victims into not realizing that they need to attain a marketable skill sooner than later. All the charts, graphs and stilted bureaucrat-ese jargon in the world is not going to change that.

        Of course, promising and providing these victims with artificial forced transfers of wealth and rhetorically disguising their true nature is really good politics.

        • Mike Sax says:

          See Bob you did the same thing Barro did. You said ‘demand’ as if you’re skeptical that is even a real thing

          • Bob Roddis says:

            No. I differentiated between what free people own and control and seek to and want to offer in a voluntary trade from subsidized funny money transfers to the masses made to induce undifferentiated “spending” by them based upon a loony, baseless and completely unproven theory that “economies” have and/or lack “momentum” and that undifferentiated mass “spending” provides such needed “momentum”. The differentiation is also important in order to identify the implicit but unstated and surreptitious attack on private property and voluntary exchange that is launched by Keynesian jargon and categories.

            • Mike Sax says:

              Ok Bob if you’re not even sure ‘economies’ exist it’s going to be hard to have an economic discussion.

              • Bob Roddis says:

                “Economies” certainly are not mechanical and there certainly is no “macro” associated with them in a meaningful way. Both descriptions are misleading in describing people engaging in exchanges. I will agree that is very hard to engage in a discussion with people whose analysis of economics is devoid of the concepts of exchange, economic calculation and catallactics.

              • Tel says:

                How would you formulate an empirical test to decide whether an economy exists?

              • Major_Freedom says:

                Sometimes asking the easiest question is the one that is most useful to the debate at hand. Kudos.

  8. Tony N says:

    No dog in this fight but…

    It takes a pretty charitable reading of Krugman (the man, not just his writings) in order to conclude that he wasn’t suggesting that Barro was nutty in a post that implicitly analogizes him to a member of the Roman Inquisition, paraphrases said Inquisitor with “hahahaha,” and is entitled “The Anti-Scientific Revolution in Macroeconomics.”

    Does having a go at Bob via others’ interpretation of his post, which seems to be what this has devolved into, demonstrate the same level of charity? Not so sure.

    • Daniel Kuehn says:

      Hmmm… Let’s back up. Clearly Krugman is critical of Barro. The question is, is he critical of Barro for making an incentive effect argument that he himself has made, or is he critical of Barro for calling standard Keynesian analysis “magical”?

      Bob, Russ, etc. seem to think it’s the former.

      Many of us think that makes no sense.

    • Ken B says:

      Tony
      Krugman is characterizing Barro as irresponsibly dismissive of any argument except the incentive effect. I see the imputed Hahahaha as implying Barro is sneering not lunatic, but your mileage may vary. In any case though no matter how nastily he is criticing Barro he is NOT thereby disavowing the incentive argument. He is NOT saying “incentives what nonsense” He is saying “claiming that incentive is the only issue is nonsense.” But once you grant that everything Murphy, Roberts, or Henderson accuse Krugman of is completely vitiated.

  9. Daniel Kuehn says:

    I don’t get the Gene update.

    You either need to explain or you really need to clarify that David is not representing your views accurately.

    • Ken B says:

      Either
      1. Gene is wrong, Krugman did disavow it; your failure to see that is revealing.
      or
      2. Gene is right, but no-one ever suggest Krugman did any such thing; your failure to see that is revealing.

      An updated form of Morton’s Fork.

      • Daniel Kuehn says:

        So I don’t know if you’re messing with Bob or honestly trying to explain it to me.

        If it’s (1.) I have to severely discount Bob’s reading skills. If it’s (2.) then Bob needs to clarify that David is not representing his views.

        • Ken B says:

          Bit of both. The only way Bob’s update makes sense that I can see if if Gene’s comment is completely otiose. Those seem the ways it can be so. So as you note, my phrasing is a bit “mess with”, since I think Gene is right and not otiose at all.

  10. Daniel Kuehn says:

    David wrote:

    “What Roberts, and later Murphy, found shocking was paragraphs two and three above. In them, Krugman completely disowns the claim about incentives that he made in his textbook. ”

    And:

    “Both Roberts and Murphy have made it clear that they are not accusing Krugman of hypocrisy for advocating extended unemployment insurance benefits during an economic slump or slow recovery. They are astounded, and certainly implicitly accusing him of hypocrisy. for disowning an argument that he himself has made. ”

    Simple yes or no question: is David accurately representing you here?

    • Daniel Kuehn says:

      I ask because Gene speaks directly – and in my view accurately but accuracy seems to be a side-issue here – to the point that David raises.

      So is that your point?

  11. Mike Sax says:

    You know Daniel I think that 96% number sounds about right. I think this is why it’s hard to take criticisms of Krugman seriously-his bashers have just cried wold too many times. You’d almost say that Krigman gets more of a pass precisely because so many frivolous charges have been levied against him.

  12. Tony N says:

    Daniel,

    It doesn’t matter why he is being critical, my point is that Krugman’s criticism was couched in a post that depicts Barro as someone behaving like an anti-science whackadoo, a la Rush Limbaugh. He is actually ascribing a pathological deficiency to his opponents when he evokes imagery of the Inquisition, Galileo crying, etc.

    Meanwhile, I think Bob was quite clear in conveying that the thrust of his latest criticism emanated from Krugman vilifying his opponents. He explicitly said there was no contradiction (he even avoided the delicious use of the K in his spelling)

    So, even if you’re right, and Krugman meant the latter of the two possibilities you suggest, it still seems reasonable to point out that Krugman is awfully good at framing an issue so as to make those he disagrees with seem either stupid or malicious. I think Bob was right to do just that.

    • Daniel Kuehn says:

      Agree with your first paragraph – I think this tendency is not always helpful. This is the blogosphere, though. If that bothers you that much you probably shouldn’t be here. Krugman is pretty good on this count in the grand scheme of things, but I do agree he could avoid it more.

      Disagree with your second paragraph – Bob is not just complaining that Krugman is prickly. If you want to introduce a THIRD theory of what is going on here, fine.

      • Tony N says:

        Daniel,

        I generally decline to engage you for two reasons:

        First, I’m not an economist, not even close. I lack the expertise to evaluate much of what is discussed in these parts. Nevertheless, as far as I can tell, you are extremely bright, and are probably a damn fine economist. I don’t require expertise of any kind to detect that you know your stuff. So, knowing my limits, I defer to you and others here, even if I suspect something is a bit off, because chances are I’m the one who is wrong.

        Second, you are remarkably steadfast. So much so, that it seems discussions others have with you here tend to move in circles. That’s actually, in my view, yet another indicator of intelligence, because it takes a nimble mind to endure that kind of thing. I sometimes think that if you were a chess player, you’d be a master of the perpetual check.

        This topic isn’t really about economics, not beneath the surface, so I’m not out my depth here. It’s about other things. Communication being one of them. And I know what I am saying makes perfect sense. Even if not convinced, you should at least acknowledge that my interpretation of Bob’s post is, at the very minimum, valid. And, to be fair, you almost do. You say you disagree, and if left at that, all would be well.

        But then you have to go and insist that I need to introduce a third theory. As if, clearly, mine is bogus. Don’t you think that if I liked a different theory I’d have offered it? And then you add the “fine,” as if there is an “otherwise,” as in otherwise I am marginalizing myself around here. What if I decline, Daniel, may I still post comments here?

        One last thing, nothing about my prior comments indicates that I was bothered. Sometimes, people around here are merely stating a position dispassionately. That’s kind of what having “no dog in this fight” implies.

        Anyway, I stand by my “theory” of what Bob meant, since he pretty much said as much in his post. I take what he writes at face value. No alternative theory is required. Thanks.

        • Daniel Kuehn says:

          If you are asking me for permission to post here I think something is being lost in translation.

          When I said you’re offering a third view of what Bob said, I’m simply noting that by his own rendition the content of why Krugman was criticizing Barro is important. Bob thought the content of the criticism was problematic.

          You seemed to be arguing that the content was irrelevant. That’s fine, but that brings us far afield of the conversation at hand I think – which very crucially turns on the content of the criticisms.

          That’s all.

          And the econ blogosphere is full of this sort of stuff you seem worried about – this sort of harsh criticism. If we get caught up in that alone we lose a lot of interesting blogs. We’d still have Nick Rowe, MAYBE Bob Murphy, maybe Market Thoma, the Economix blog, and the NBER weekly updates.

          Noah is out, Econlog is out, Cafe Hayek is out, DeLong is out, Williamson, Sumner, Coordination Problem is out, Gene is out, I’m out I’m sure too.

          • Tony N says:

            Daniel,

            All fair enough.

            But just understand, you keep implying that I’m worried or concerned. It’s a very Krugmanesque misrepresentation, in fact. Subtle, probably not worth fighting over, but wrong nonetheless. So, just for the academics of it all, I’m going to keep pointing that out.

            Yes, I’m well aware of the ubiquity of harsh criticism, but I’m not “worried” about it, not in the least. It may not be very productive, but it doesn’t concern me either. It’s probably been a net positive in terms of macro reaching a broader audience. You know, “bad boys get the girls” and all that jazz.

            In fact, If I were Krugman’s muse, I’d whisper in his ear every day, “Keep it up, Paulie, keep being nasty, your fans love it, traffic, traffic, traffic!”

            And as Bob Murphy’s, I’d say “call him out, Bobby, get that bastard, traffic, traffic, traffic!”

          • Bob Murphy says:

            DK wrote:

            And the econ blogosphere is full of this sort of stuff you seem worried about – this sort of harsh criticism. If we get caught up in that alone we lose a lot of interesting blogs. We’d still have Nick Rowe, MAYBE Bob Murphy, maybe Market Thoma, the Economix blog, and the NBER weekly updates.

            Noah is out, Econlog is out, Cafe Hayek is out, DeLong is out, Williamson, Sumner, Coordination Problem is out, Gene is out, I’m out I’m sure too.

            I am happy to take the above gamble.

        • Daniel Kuehn says:

          And here’s the thing, Tony – there’s a grain of truth to Krugman’s claim that you can’t dismiss.

          Barro started things off by calling Keynesian arguments magical.

          Now that’s an astounding statement. Even if you disagree with these arguments, how should we react to someone that calls these arguments “magical”.

          How would you react to someone that called the theory of evolution a “magical” explanation.

          Would you question their commitment to science?

          I would.

          So yes, I agree Krugman lays it on but let’s not forget what he is actually criticizing. Maybe he lays it on thick (Barro is CLEARLY a good scientist), but is there a good reason he makes this particular criticism?

          In fact, there’s a very good reason.

          • Ken B says:

            This exchange shows one of the reasons why you two are amongst the posters here I like and respect.

          • Tony N says:

            I get you Daniel, I really do. I can agree with much of that. And if it pleases the court, I’d like to reserve the balance of my time. Need to leave the office and take my wife to a play about Judy Garland, before which I plan to get extremely drunk.

            It has been fun though, sincerely.

            Ken B, I thought you liked me in my birthday suit :) Whooooaaaaaaa.

            • Ken B says:

              Don’t be fooled Tony. I’m only really interested in your wife … the rest is just a tactic
              :)

          • Major_Freedom says:

            Your argument is predicated on the assumption that Keynesianism is in some way akin to well grounded sciences such as evolution.

            That assumption is false.

            To call Keynesianism “magical” is not in any way close to calling evolution “magical.”

            Keynesianism is full of claims contradictory to economic science, and yet its followers go about talking and arguing as if they did not exist, or exist but are unimportant.

            This is the same class of beliefs as magic. It is not unreasonably dismissive to call Keynesianism “magic.”

  13. Mike Sax says:

    “It doesn’t matter why he is being critical, my point is that Krugman’s criticism was couched in a post that depicts Barro as someone behaving like an anti-science whackadoo, a la Rush Limbaugh. He is actually ascribing a pathological deficiency to his opponents when he evokes imagery of the Inquisition, Galileo crying, etc.”

    However, Tony, isn’t Barro doing the same thing in my quote of him?

    “‘Agriculture Secretary Tom Vilsack said recently that food stamps were an “economic stimulus” and that “every dollar of benefits generates $1.84 in the economy in terms of economic activity.” Many observers may see how this idea—that one can magically get back more than one puts in—conflicts with what I will call “regular economics.” What few know is that there is no meaningful theoretical or empirical support for the Keynesian position.’”

    He certainly makes Vilsack sound like an anti scientific wackadoo here.

    • Tony N says:

      Sure, Mike. That’s a fine point. And I’m not surprised by the presence of snark on either side this divide.

      But a tu quoque appeal doesn’t in any way invalidate what I’m saying, or validate the claim that Krugman was, in no way, implying that Barro was nuts, being nutty, etc.

      • Mike Sax says:

        I guess that’s my trouble Tony. Many economic bloggers get unvcivil and make the other guy’s arguments sound silly. I don’t think it’s just Krugman.

  14. Transformer says:

    Henderson says ” They are astounded, and certainly implicitly accusing him of hypocrisy. for disowning an argument that he himself has made. ”

    Roberts titles his next post on the subject “Paul Krugman is not a hypocrite”

    1. Is he a hypocrite or isn’t he ?
    2. Where does he disown his earlier model ?

  15. Jonathan Finegold says:

    I think Krugman’s post was about Barro misrepresenting him, so to speak. This isn’t what they actually said, but I think it sums up the general gist,

    Barro: “Those idiot demand-siders think extending UI will decrease unemployment, even though UI creates incentives that increase unemployment.”

    Krugman: “If you think we’re in a demand-side recession, and you accept Keynesian logic, the idea that UI decreases unemployment is pretty straightforward.”

    Murphy: “Omg, Krugman thinks Barro’s an idiot for thinking that UI creates unemployment incentives, even though Krugman’s textbook says the same thing!”

    Murphy: “How can you call your opponent an ideologue for believing something you used to (or still) believe?”

    Krugman wasn’t calling Barro an ideologue for thinking that UI increases unemployment. He was calling Barro an ideologue for not understanding the Keynesian argument in favor of UI. And that was pretty much the point of Scott Sumner’s (excellent) post.

    • Anonymous says:

      So if I understand this thread correctly, the “Keynesian argument”*which is sold to us by PK as the standard view) is as follows:
      If the economy is in a “demand side recession”, extending UI benefits increase demand and therefore, reduces unemployment = Good;
      If the economy is not in a demand side recession, the Krugman textbook (Which presumably is Keynesian as well?) applies, and UI causes more unemployment = Bad.

      I don’t understand what the state of the economy has to do with this. Wouldn’t be more logical to say UI always will cause demand (by the unemployed) to increase?
      (Of course, we are asked to ignore that the money to pay for UI has to come from somewhere and presumably, this will reduce demand somewhere else. You know, seen versus unseen, all that.)

      I’m so confused. But then, I don’t even understand why the government is in the insurance business to begin with.

      And lastly, how can not understanding something make you an ideologue? An inquiring mind wants to know.

  16. Some Links says:

    [...] Bob Murphy reflects on Paul Krugman’s incivility and inconsistency. [...]

  17. Major_Freedom says:

    Does anyone have a post of Krugman arguing against UI because we happened to have NOT been in a recession at that time?

    • Matt M (Dude Where's My Freedom) says:

      Nope. That’s about as likely as finding a Keynesian willing to oppose massive budget deficits while a Democrat is in office…

      • Major_Freedom says:

        You know, now that I think about it more, the more I realize just how devious Krugman’s argument is about UI.

        For consider, if we weren’t in a recession, then there would be little to no UI doled out, so there would be no significant UI reductions to speak of.

        Look at what the implications of this are. More unfalsifiable stances. If we’re in a recession, and UI dole is high, then he can argue UI is good for the economy because “demand side” trumps. At the same time, he can present that argument as non-absolutist, because by saying “Now now people, I said UI is good ONLY during a recession!” he can never has to actually sanction a real world reduction in UI, because the way he sets it up, the alternative world where UI would harm employment, never exists, because in such a world, employment is close to zero and thus so is UI.

        So in Krugman’s world, UI never has to be challenged in the immediate moment, when all arguments are made. No matter what happens to UI, he can say existing UI is always a good thing and any reduction in existing UI is always a bad thing.

  18. RPLong says:

    Bob, I’d like to share a potentially useful piece of advice with your readers. This is something that I’ve found comes in handy.

    Step 1: Stop reading Paul Krugman’s blog entirely. (Wait, hear me out.)
    Step 2: Read everything you can find about Krugman, but written by bloggers other than Krugman.
    Step 3: Give all blogs that you read equal weight on the issue of Krugman being right or wrong.

    What you end up is sort of like that party game, “telephone,” except it works in the reverse. The more the message gets passed back-and-forth, the more accurate it becomes.

    I have no idea WTF Krugman “means” when I read his blog directly, because it is written in such an obviously misleading and polemic way. But after watching Robert Murphy, Steven Williamson, John Taylor, John Cochrane, Sumner, Rowe, Kuehn, et al. pass the message back and forth, I get a much better sense of what Krugman would have said if he hadn’t have been sharpening torture instruments while writing his blog posts and articles.

    That’s what works for me. You may all now go forth and prosper on my advice. ;)

    • Ken B says:

      Elegant!

      Ambiguous, but elegant.

    • Major_Freedom says:

      So what you’re saying is that to become a popular economist, you have to be cryptic, vague, and misleading?

      Hmmm…there might be some truth to that, given existing intellectual conditions.

      More people have more fun with a mystery story than than with biological classification texts that don’t leave anything to the imagination.

  19. Mike Sax says:

    As long as I’m chatting with Austrians

    Mises does sound more Keynesian than Monetarist here http://diaryofarepublicanhater.blogspot.com/2014/01/ludwing-von-mises-for-fiscal-policy.html

    • Bob Roddis says:

      (i) Except in a socialised community where wage-policy is settled by decree, there is no means of securing uniform wage reductions for every class of labour. The result can only be brought about by a series of gradual, irregular changes, justifiable on no criterion of social justice or economic expedience, and probably completed only after wasteful and disastrous struggles, where those in the weakest bargaining position will suffer relatively to the rest. A change in the quantity of money, on the other hand, is already within the power of most governments by open-market policy or analogous measures. Having regard to human nature and our institutions, it can only be a foolish person who would prefer a flexible wage policy to a flexible money policy, unless he can point to advantages from the former which are not obtainable from the latter. Moreover, other things being equal, a method which it is comparatively easy to apply should be deemed preferable to a method which is probably so difficult as to be impracticable…….

      (ii)…..If important classes are to have their remuneration fixed in terms of money in any case, social justice and social expediency are best served if the remunerations of all factors are somewhat inflexible in terms of money. Having regard to the large groups of incomes which are comparatively inflexible in terms of money, it can only be an unjust person who would prefer a flexible wage policy to a flexible money policy, unless he can point to advantages from the former which are not obtainable from the latter.

      (iii) The method of increasing the quantity of money in terms of wage-units by decreasing the wage-unit increases proportionately the burden of debt; whereas the method of producing the same result by increasing the quantity of money whilst leaving the wage-unit unchanged has the opposite effect. Having regard to the excessive burden of many types of debt, it can only be an inexperienced person who would prefer the former. “The General Theory” Pages 268-269 Chapter 19

  20. Transformer says:

    Murphy (in his original post): My point is that Krugman frequently accuses his opponents of being stupid and/or evil, when they present a view that he himself advanced in other circumstances

    Dillow: Paul Krugman is being accused of hypocrisy for calling for an extension of unemployment benefits when one of his textbooks says “Generous unemployment benefits can increase both structural and frictional unemployment

    Murphy (in response to Dillow): No no no, that is obviously not what Russ and I were saying.

    Can someone explain how Dillow is misrepresenting Murphy’s views here ? Seems a pretty close approximation to me.

    • Bob Murphy says:

      Just re-read this very post, Transformer.

      • Transformer says:

        I did , and I still don’t see it.

        Do you think Dillow is misrepresenting you because

        A) You weren’t accusing Krugman of being a hypocrite.

        Your point appears to be that “Krugman frequently accuses his opponents of being stupid and/or evil, when they present a view that he himself advanced in other circumstances” and the article in question is an example of that.

        This sounds close to an accusation of hypocrisy and David Henderson appears to agree. But above you say Krugman is being “slippery” rather than hypocritical so perhaps you think that Dillow was wrong to use the word hypocrite?

        B) You think the phrase about Krugman “calling for an extension of unemployment benefits when one of his textbooks says ‘Generous unemployment benefits can increase both structural and frictional unemployment’” does not capture what you think is slippery about Krugman’s post.

        This seems more likely as you (mostly) seem upset about the criticism of Barro rather than the Krugman (non) contradiction on the effects of UI. But the whole thing does seem to hinge upon Krugman’s current support for extended UI sitting uneasily with the stuff about UI disincentives in the textbook so Dillow’s sentence still seems to capture the essence of the disagreement to me ,, and not be a misrepresentation.

  21. Capt. J Parker says:

    In order to support the thesis that Barro is just an ideologue, not an economist, Krugman performed a little sleight of hand with links to Barrow’s Op-Eds in the Wall Street Journal. If Krugman’s beef is with Barro’s analysis (or lack thereof) of extending UI he should have linked to this Op-Ed entitled: The Folly of Subsidizing Unemployment http://online.wsj.com/news/articles/SB10001424052748703959704575454431457720188 No one reading that Op-Ed could accuse Barro of failure to present a reasoned economic argument. Krugman instead points to this Barro piece entitled Keynesian Economics vs. Regular Economics
    http://online.wsj.com/news/articles/SB10001424053111903596904576516412073445854

    In this latter article Barro makes some quantitative arguments against extending UI but, he also paints a target that Krugman simply had to shoot at namely, this: (quoting Barro) “Theorizing aside, Keynesian policy conclusions, such as the wisdom of additional stimulus geared to money transfers, should come down to empirical evidence. And there is zero evidence that deficit-financed transfers raise GDP and employment—not to mention evidence for a multiplier of two.” (with zero in italics) Inconclusive, debatable, contested, controversial perhaps unlikely to be correct perhaps but zero? Is zero the “standard view”?

    Now, I enjoy seeing Krugman smacked down as much as anyone and Krugman’s desire to drag every debate down to the level of ad hominems is really tiresome but, gee wiz, what did Barro think was gong to happen when he decided to give Keynesianism both barrels in a four paragraph Op-Ed? Another place Barro leaves himself open for criticism IMHO is that he says policy conclusions require empirical evidence and then quickly goes on to say empirical evidence is hard to come by because lack of controlled policy experiments. So, it seems he dooms us to a world where we can’t draw any policy conclusions. Come on dudes, you can do better than that.

    PS sorry that the linked articles are behind the WSJ pay wall.

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