Consulting by RPM || Free Advice Blog

Krugman Krushed

I’m going to do two blog posts (this is the first), then I might be quiet for a while. I am still trying to catch up on various things…

Von Pepe sends this great article explaining how Krugman was getting owned (I refuse to use the hip term) by his commenters. It got so bad that Krugman took action.

Incidentally, the guy writing the article (Fred Douglass) apparently reads Krugman even more than I do. But he singled out a particular comment that had caught my eye too; it’s been sitting on my Firefox browser since July 28. It is in reference to Krugman’s continued bashing of the Rogoff-Reinhart piece (on the connection between debt and GDP stagnation), and it is hilarious:

No it is not “all, repeat all, the postwar demobilization” [as Krugman had claimed–RPM]. The lie has now been told twice; one more time, and it will enter the Krugman canon of anti-science.

Here is some unsolicited advice to PK’s bloggers: Read Rogoff’s paper. Do not rely on an ideologue whose sociopolitical agenda is destroyed by Rogoff’s analysis to represent to you what Carmen and Ken have said. Here is the link.

http://www.economics.harvard.edu…

Rogoff’s conclusion (that very high debt is bad for an economy) is supported in Rogoff’s paper, by PK’s own admission, in six different countries on three continents in a range of macroeconomic environments spanning five decades. Belgium. Japan, Italy, Canada, and the United States. Actually more, but let us just take as fact what PK stipulates. Just one (repeat “one”) example is at the end of the Second World War. Just one (repeat “one”) example can be attributed to postwar demobilization.

Now, PK’s repeated claim that it was Reinhart and Rogoff’s “own choice to highlight US data” at the end of WWII is a crude effort to distract. Read the paper to decide for yourself whether this alleged “highlighting” exists, let alone whether its “highlighting” undermines the conclusion from six different countries on three continents spanning five decades in a fine example of economic science.

The accusation that Carmen and Ken “falled to notice” what they clearly noticed and failed “to think about what that means” what they clearly thought about it will not survive your spending five minutes with this paper. What is clear is that PK has “thought about” what the Reinhart-Rogoff economic science “means”. It means that his proscription [sic] for perpetual deficits is a prescription for disaster.