Keynesian versus Keynesian
Somebody help me out here: How is it possible that Brad DeLong is now talking about jigsaw puzzles etc. as if that is totally consistent with what he (and Krugman) have been saying all along? It’s not merely that he and Krugman over the last two years have been focusing on Aggregate Demand, while remaining agnostic about the necessity of “recalculation.” No, they have pointed to empirical refutations (in their mind) of the proposition that there are sectoral imbalances. E.g. here’s Krugman from just a few weeks ago:
Mark Thoma leads us to new research from the San Francisco Fed showing that recent college graduates have experienced a large rise in unemployment and sharp fall in full-time employment, coupled with a decline in wages. Why is this significant?
The answer is that it’s one more nail in the coffin of the notion that employment is depressed because we have the wrong kind of workers, or maybe workers in the wrong place.
In some ways I think framing the discussion in terms of “structural unemployment” isn’t helpful. It may be better to say that a number of influential people want us to believe that Great Recession is serving some useful purpose — that the economy is “recalculating”, that it’s getting carpenters out of Nevada to jobs where they’re needed, etc….
The right question to ask, with regard to all such arguments, is, where are the scarcities? If we have the wrong kind of workers, then the right kind of workers must be in high demand, and either be in short supply or have rapidly rising wages. So where are these people? If the problem is lack of skill, then highly skilled workers — such as recent college graduates — should be doing well. If the problem is too many carpenters in Nevada, then non-carpenters somewhere else must be doing well. Who? Where?
Well, if there are such people, they’re doing a very good job of hiding.
This is a demand-side slump; the evidence is grossly inconsistent with any other story.
Let me anticipate two possible responses:
(1) “Not all Keynesians are the same, Bob. Krugman and DeLong are allowed to disagree with each other, since they are actual scientists, unlike you ideological Austrians.” No, not on this point. I’m not going to bother digging it up, but for sure DeLong has pushed the exact same argument in the past. He has written that if our current malaise were due to sectoral imbalances, then we’d see excess supply in some sectors and excess demand in others. But we don’t, ergo it isn’t about a need to move resources around.
(2) “It’s not an all-or-nothing proposition, Bob. One can consistently say that the economy suffers from misallocated resources and that the best way to reallocate them is to restore Aggregate Demand.” No, not according to Krugman above. Go re-read him. He’s not saying, “This is only one component among several.” No, he says the Fed evidence is “one more nail in the coffin” of the recalculation theory. Unless you’re talking about Dracula, people don’t take naps in coffins–they go there to die. You don’t take a secondary explanation–that’s worthy of a full article unto itself–and put it into a coffin.
I really, really, cannot comprehend why people don’t understand that all economists – including all Keynesians – agree that structural change and recalculation is a part of every day life. That IS economics. That is why we all think markets are so important for allocating resources – because price signals are needed to make these recalcualtion decisions.
DeLong is saying that normal calculation and recalculation cannot go on if effective demand is not consistent with full employment. He is not saying, as the Austrians do, that the downturn itself is a recalculation of a “cluster of errors”. But of course he acknowledges that recalculation goes on. But what is required for recalculation to go on? Good price signals. And Keynesians say we aren’t gettign good price signals at precisely the point where Austrians say we’re starting to get good price signals. That’s the heart of the disagreement.
Krugman, I think, often overstates his point. And in that sense I think you’re right on #2 and he’s wrong. But I can understand WHY he beats the drum so hard. Certainly recalculation is going on and some recalculation might even be relevant to the current downturn. But it’s not the major cause of it, and that needs to come through loud and clear.
For Austrians, in other words, the pain of the downturn is the process of recalculation.
For Keynesians, recalculation occurs all the time and the distortions that cause the downturn also prevent normal recalculation and structural change and generate a lot of uncertainty.
I’ve been amazed at the amazement over this. I’m always shocked to learn what you think we all think. I would not have guessed, ex ante, that “Keynesians think structural change and economic calculation goes on and requires good price signals” would have been at all surprising or controversial.
DK wrote:
I’ve been amazed at the amazement over this. I’m always shocked to learn what you think we all think. I would not have guessed, ex ante, that “Keynesians think structural change and economic calculation goes on and requires good price signals” would have been at all surprising or controversial.
Let the amazement end now. Here’s Krugman, from the quote about 8 inches above:
“In some ways I think framing the discussion in terms of “structural unemployment” isn’t helpful.”
Krugman has said, in no uncertain terms, that this isn’t about “structural unemployment” at all. (In earlier posts.) That if it *were* about structural unemployment, we would see X, Y, Z.
He has shown data on manufacturing vs. construction job losses, and concludes that this isn’t about sectoral reallocation.
So please stop being surprised that we think Krugman dismisses our concerns, because he does.
You’re right, in some isolated passages he doesn’t. That’s why we often accuse him of Krugman Kontradictions.
Or we can go your route, and overlook the plain meaning of what he says time and again, and assume Austrians are paranoid.
Right – and I said I disagree with Krugman on that.
But since when does “this downturn is not caused by structural unemployment” the same as “economic recalcualtion and structural change doesn’t happen”.
Like I said – Brad doesn’t seem to be saying “recalcualtion caused the downturn”. He seems to be saying “recalculation goes on all the time and this downturn is preventing it from happening”.
re: “So please stop being surprised that we think Krugman dismisses our concerns, because he does.”
For the third time now, Bob – I acknowledge he dismisses the idea that recalculation in response to an earlier “cluster of errors” is a cause of this downturn. Brad is not changing his position on that. I dismiss that idea too (at least I dismiss the idea that it’s a major factor… it could be playing a minor role I suppose).
But since when does “this downturn is not caused by structural unemployment” the same as “economic recalcualtion and structural change doesn’t happen”.
Since recalculation and structural change requires (albeit temporary) unemployment, declining profits, and “idle resources,” meaning always, which means recalculation and structural changes should be (at least) a component of the cause(s) for economic downturns, and not glibly dismissed as per Krugman as being completely irrelevant and should not even be considered in the “framing.”
You seem to change the story constantly as each subsequent claim you make is shown to be wrong, as if your goal is to keep valid the Keynesian story (and thus Krugman) even it means to make incorrect statements along the way.
Murphy (and most Austrians) is (are) not attributing to Keynesians (and Krugman) the position that recalculation and restructuring are not taking place at all during downturns. (Although to be honest I am sure that if you asked them this pointed question their answer would depend on which story, Austrian or Keynesian, is “vindicated.” Krugman is known to do this all the time, as Murphy I think convincingly has shown in prior posts. When a set of data supports Keynesianism, that data becomes relevant and in some cases even causally existent (meaning it generates economic changes that are noticeable and vindicate Keynesianism). When that same data supports Austrian economics, that same data becomes benign, irrelevant, and typically for Krugman, misrepresented and incomplete. A good example of this is when Krugman first argued that the argument that unemployment across states was varied and heterogenous an “illusion,” when that data seemed to vindicate the Austrian theory of recalculation and restructuring. At the time, the differences in unemployment was due solely to population differences, making the actual difference zero and thus vindicate the “aggregate demand” theory of Keynesianism. But just two weeks later, after an academic paper was published that found a correlation between unemployment differences across states with Keynesian stimulus spending differences, all of a sudden Krugman changed his tune and accepted that there were differences in unemployment between states. In other words, the same data was at first dismissed, then accepted, depending on whether or not the Keynesian story was vindicated.
This latest is founded on contradictory reasoning as well, although to be fair, this latest is a disagreement between Krugman and DeLong (but since they constantly echo each other, it is significant).
On the one hand, Krugman (and DeLong) denied that recalculation and restructuring are part of a recession process at all. They seem to have done this when they wanted to promote the Aggregate Demand story. They would say, and I am paraphrasing here: “Recalculation problem? Pshaw, it doesn’t even exist. This is an Aggregate Demand problem.”
On the other hand, DeLong now argues that recalculation and restructuring are at least a part of recessions, in the sense that should recalculation be thwarted in some way, the economy cannot recover. Before, the recalculation story was the Phlogiston Theory of fire. Now it is at least related to recessions and could in theory hold recovery back. Of course, DeLong holds that this formerly phlogistonistic story cannot take place unless, you guessed it, Aggregate Demand is somehow increased by government first. Then this reluctantly accepted, whiny step child recalculation, “jigsaw” story, can do whatever the Austrians are saying it will do. But Aggregate Demand is still King as per DeLong and Krugman. The King must be given powers first and foremost before the Austrian supported peons can even fix these formerly benign recalculation problems that are now admitted by DeLong to even exist and in theory hold recovery back.
Put all this together, and it definitely suggests that DeLong (and probably Krugman at some point as well) is now singing a totally different tune than before.
Before, recalculation was a benign, if not illusory, arm chair posturing by free market ideologues, who reject Aggregate Demand because they knew deep down that only government could fix it, and being the ideologues they were, came up with this recalculation nonsense as a diversion in order to advance their actual agenda of anti-government sentiment, and are advocating a taking away of bread from the poor if it means they can shrink government. Damn these ideologues, they have no conscience, so we liberals have to attack the government attackers, and deny everything they say as a matter of principle, and insist that Aggregate Demand is THE problem, and thus government as THE solution. That way, the the threat of taking bread away from the poor can be mitigated.
Now, DeLong is admitting that the evil bread denying ideologues do have a point in the recalculation story. But he still won’t make recalculation a primary problem, because that would imply the Austrians are right, and that would mean the government bread should stop being given to the poor, which would go against his psychology and thus make him reject the recalculation story as primary. No, the recalculation story, the disobedient step child, will only be adopted and accepted into the household, but they will not be given the keys to the house or the car. Thankfully, these reluctantly accepted brats can’t fix the economy. The parents are still in charge. The “adults”, with relief, are still primarily responsible. Aggregate Demand is still the primary issue, and this obnoxious step child recalculation story, while now at least a part of the reason why the house in in disarray, cannot hope to be made obedient and efficient unless Aggregate Demand is fixed first. If Aggregate Demand is not fixed first, then the recalculation problem has no way of taking place, and thus, importantly, no way for the economy to be fixed.
This admission that recalculation is, at least in theory, capable of holding economic recovery back (of course with Aggregate Demand still being the primary cause for recessions in their eyes), is nevertheless a complete reversal from DeLong’s and Krugman’s initial position in treating recalculation like the Phlogiston Theory. If you asked me, I would say that deep down, they now accept that recalculation is at least a part of the reason why economies can be in recession (after all, the recalculation theory is based on sound economics, and as economists, DeLong and Krugman can, hopefully, only take their statist bias so far before they have to accept it, which looks to be soon after they were exposed to it due to the internet, and are now probably reading it secretly on their own), but they still cling to the Aggregate Demand story as primary. Completely rejecting Aggregate Demand would mean a lifetime of waste, and not many academics are capable of doing that.
Although on the surface it looks like that they have held the same Aggregate Demand story (with recalculation) all along, us Austrians who are used to being continuously pelted with Keynesian snow balls over the years notice very clearly when the snow balls change in makeup. Maybe you cannot tell because you are partial to Keynesian theory. Not in full of course but you certainly don’t reject it completely like the Austrians. You probably don’t notice what we notice, but I can tell you that there is a definite change in tune from Krugman and DeLong, not in full of course, but definitely when it comes to presuming the recalculation story and data that are consistent with the Austrian theory, when the story and data justifies the Keynesian theory. This is very different than before, when the recalculation story was not even worth considering because it wasn’t real. Now at least it is real, and that is a snowball of a different color.
Like I said – Brad doesn’t seem to be saying “recalcualtion caused the downturn”. He seems to be saying “recalculation goes on all the time and this downturn is preventing it from happening”
Could it be that what it “seems” to you is different from what it “seems” to others, and if so, imply that you could in theory be wrong about what he actually meant? I would say that your interpretation is completely off, because recalculation is the very process by which economies get out of recession, which Krugman and DeLong completely reject. Both have always argued that the fundamental problem is Aggregate Demand, and that if this is not increased by government, (they say “stabilized”), then everything else is off the table.
The truth is that no matter what quantity of money exists in the economy, then I am sure that even Keynesians would admit that if recalculation were as good and effective as Austrians say it is, then prices and wages would adjust downward and thus enable whatever demand that does exist to alleviate unemployment and restore profitability as costs and revenues both fall to a level that allows for a positive difference between them, and thus restore profitability. The difference of conviction here of course is that Keynesians believe that the market cannot do this on its own without government counterfeiting, I mean inflation, I mean stimulus, I mean increasing Aggregate Demand, whereas the Austrians say not only can the market do this, but also that recalculation is the primary necessity for economic recovery, which government thwarts when it spends more and counterfeits more in order to do what it and Keynesians think the market cannot do on its own.
So whereas Krugman and DeLong used to deny recalculation in toto, it is now something to not glibly dismiss as a diversionary tactic by anti-government ideologues. Now it is at least real and something that can in theory hold recovery back (of course Aggregate Demand is still primary and must be increased if this recalculation can even take place).
Now the economic structure is no longer just a homogeneous blob of schmoo, which the government has to ensure is small enough relative to what the blob eats, which the government is also ultimately responsible for, in order for the food to have an eater and thus the production of food to have enough employment opportunities.
Now the economy is a jigsaw, a heterogeneous concept that has *parts*. These parts of the economy now have to fit together, and if pieces of the puzzle are messed up, then the whole economy is prevented from operating smoothly. Of course only the government can ultimately ensure that the pieces are all facing up first, before the peon puzzle assemblers can fit them together correctly. If the government does not do this, then the peons will be stuck in a perpetual loop of trying to fit together only the pieces facing up, and those facing down will remain forever idle, and that means only some of the peon puzzle assemblers will remain employed as puzzle assemblers, with the remaining having no reason to be hired. Thankfully, the Aggregate Demand story, the government story, the government counterfeiting and spending story is still primary, and is the only entity capable of turning all the messed up pieces upright initially, before the peon assemblers can go to work.
The problem with the above Keynesian view is that Aggregate Demand is a result of, not a requirement before, recalculation. When the economy’s real productive structure is correctly assembled, then all the pieces are turned up. What government spending and counterfeiting actually does is prevent the pieces faced down from being turned upright and then assembled, because the reason, according to the Austrians, for why the puzzle is messed up in the first place is because the government spent and counterfeited in the past. This made the puzzle assemblers believe they were assembling a giant puzzle with a sensible picture, when in reality all they were doing is moving the pieces around in a haphazard and incorrect way that eventually and inevitably make them realize, all at once, that the puzzle is being assembled incorrectly. Pieces that went here should have gone there, and pieces that went there should have gone here. They were misled because the signal for correctly placed pieces, that easy to fit feeling, was distorted by government.
Keynesians psychologically reject this story because they believe the puzzle assemblers are inherently bad puzzle assemblers to begin with, and will inevitably make mistakes. This is only partly true. As with every Keynesian story, there is always a kernel of truth that is twisted and distorted to make a terrible aggregate picture. Yes, the puzzle makers make mistakes, but mistakes will only happen at the individual level, where decisions to place puzzle pieces is made. If an individual puzzle assembler makes mistakes, a proper signalling system that is allowed to function will tell him he made a mistake. Austrians hold that the proper signalling system is the free market rate(s) of interest. You call this rate artificial, Austrians call it natural. You call it artificial because you hold that natural is what a government controlled economy decides, and anything else is not natural. Austrians hold the opposite view. We hold that only individual decision making, specifically, voluntary, peaceful decision making, where the mind is free to think and then act on that thinking, is the only natural system. Violence, according to the Austrians, prevents the economy from functioning properly because it prevents the individual puzzle assemblers from being able to make decisions and then learn from their decisions in relation to the decisions of other puzzle assemblers.
Keynesians take the fact that individuals make mistakes, then twist it and make the absurd conclusion that individual puzzle assemblers cannot learn from their mistakes in a free market price system. There allegedly must be a singular, centralized controlling consciousness that uses violence to allegedly thwart bad decisions before they are made. The truth is that the puzzle can only be made if the signalling system of peace and voluntary price and interest rate formation is allowed to function without centralized control. Centralized control, contrary to your likely intuition, actually makes things worse because the only centralized control that actually exists is each individual in relation to their individual bodies. One person controlling another by violence and coercion is antiquated mythology.
Have you ever assembled a large and complex puzzle? Imagine opening a box of a puzzle with 300,000,000 pieces, which is roughly the number of pieces in the US economy (each individual is one piece of the puzzle). What is the best way to assemble the puzzle? Should each individual be free to try their best to find out where the pieces should go, and then make mistakes, learn from them, and correct their actions, or does it make more sense for there to be one person with a gun who points it at everyone else to ensure that they do what that gunman wants? Sure, if the gunman was omniscient and knew what everyone wants and where each piece should go in the puzzle, and left in peace the puzzle assemblers will never be able to complete the puzzle (already this analogy sucks because the economy should be viewed as a puzzle whose picture and size keeps changing over time, which of course means whatever we conclude in this analogy should be taken lightly) then the puzzle requires that gunman.
But are people like this? Does a puzzle assembly require a gunman? I would argue that a 3,000,000 piece puzzle will be best assembled if individuals are free to decide where pieces should go and then learn from their mistakes by feeling the pieces and looking at the pictures, rather than a system where a lone gunman decides the feeling for everyone, and leads all the assemblers to put pieces in the wrong spot collectively. Only that connection feeling and looking at the picture can allow individuals to assemble the puzzle. A gunman that sets his own feeling for everyone will lead the assemblers to make the wrong picture, because only a voluntary and allowed feeling of connection will enable the assemblers to know when they are correct and when they are wrong.
Austrians and sympathizers have a real hard time thinking in terms that go beyond black and white. Very little nuance is required to doom all of their ideas.
David, that sounds very much, indeed is, a black and white argument.
Austrians are “this” but not that.
Only a “little nuance” can refute them.
Is everything black and white to you? LOL
Because if you don’t always think in terms of black and white then you can never do so.
A non-“black and white” argument is an illogical argument. Logic follows the law of contradiction.
Even a grey argument is a black and white argument, because a grey argument implies it is not a non-grey argument.
The expression “not everything is black and white” is nothing but self-contradictory nonsense that obfuscates rather than enlightens.
A non-”black and white” argument is an illogical argument. Logic follows the law of contradiction.
I think you mean the law of non-contradiction. If an argument is contradictory, then it is of course illogical. But just because an argument isn’t “black and white” doesn’t make it contradictory. You can have arguments, for example, that support a given conclusion without establishing it definitively.
Even a grey argument is a black and white argument, because a grey argument implies it is not a non-grey argument.
Is that a Zen Koan?
I think you mean the law of non-contradiction. If an argument is contradictory, then it is of course illogical. But just because an argument isn’t “black and white” doesn’t make it contradictory.
Logical arguments cannot NOT be black and white.
You can have arguments, for example, that support a given conclusion without establishing it definitively.
Not relevant. An argument containing a conclusion that is not definitive is still a black and white argument, in that the argument is not definitive, rather than definitive. This but not that.
Is that a Zen Koan?
No, it’s first order logic. If you want to call it Zen, then whatever floats your boat.
re: “Or we can go your route, and overlook the plain meaning of what he says time and again, and assume Austrians are paranoid.”
This is unfair, Bob. I said the Mises Institute specifically was paranoid when they interpreted a positive article in the New York Times as a hit piece. That is paranoid, and yes I will get a chuckle out of it. Otherwise, I’ve been quite open to Austrians.
You seem to have that right.
Daniel, in all fairness sometimes it seems like you are wishing in arguments for keynesians that they simply do not make.
Standard IS-LM analysis doesn’t really encompass or even infer anything from price signals or “recalculation”, and if you were to introduce those two you’d either try really hard to reconcile IS-LM analysis with them, or abandon it entirely.
This isn’t to say that your understanding of Keynes is faulty and that there is no possible reading of Keynes which takes into account heterogenity, price signals, specificity, constant economic calculation, entrepreneurial expectations and all other austrian themes – just that such a reading is not really all that popular, never was popular and is contrary to the essence of modern Keynesian thought.
re:“Daniel, in all fairness sometimes it seems like you are wishing in arguments for keynesians that they simply do not make.”
People say this a lot, and yet it always turns out they make my arguments.
That post that Bob links to traces back to an earlier post where Brad cites my critique of the jigsaw puzzle, after all. And lo and behold an internationally known economist happens to read it and says “yes, this is essentially what I think too”.
Bob did this when he reviewed my 1920-21 paper, too. He said that maybe Keynes thought that, but Krugman sure doesn’t.
And lo and behold – several months later Krugman responds to his commenters bringing up 1920-21 and says precisely what I suggested modern Keynesians would say.
I’m sick of people telling me my take on Keynesianism is wishful thinking. My take on Keynesianism seems to be confirmed a hell of a lot by substantial Keynesians for just some wishwill thinking.
Re: 1920-1921: I have to go back and look at Krugman’s history of blog posts carefully. But I am pretty sure his own description of our current woes has morphed over time.
For example, I know for a fact that Krugman within the last year or so has said something like, “Wages are sticky. Who knew?” making fun of people who deny that we have market-clearing problems.
But now he has lately been on the warpath saying that falling wages won’t solve our recession.
Is that a pure contradiction? Maybe not, but it’s definitely a Krugman Kontradiction. I.e. he mocks his opponents for not recognizing that we have sticky wages (and hence their Chicago School logic fails), and then saying our recession isn’t really about sticky wages.
So same thing with the 1920-1921 stuff. I am very confident I can find him discussing the bad effects of deflation etc. that have nothing intrinsically to do with a liquidity trap. And so that’s what I was saying to you in my reaction to your paper. The stand-alone arguments Krugman uses to explain why the 1930s were so awful, and why today is so awful, could be applied to the 1920-1921 episode.
You don’t solve that problem by finding Krugman agreeing with your analysis in some other blog posts, because (I claim) Krugman Kontradicts himself all the time.
Look, he did it with monetary policy too; Sumner busted him big-time on it. Early on, Krugman ripped anybody who thought the Fed could solve the problems. Then he changed his tune over time until he was indistinguishable from Sumner.
As for IS-LM and price signals…
How does IS-LM even make sense without price signals??? How would you talk about demand for loanable funds, supply of loanable funds, or demand for money without talking about economic calculation?
Those things you list – heterogeneity, price signals, specificity, economic calculation, entrepreneurial expectations, etc. – are not “Austrian themes”. They are economic themes. Some Austrians have been so insular they’ve convinced themselves they’re the only ones that talk about this stuff.
Hayek is the most eloquent person I know to talk about economic calculation, but Samuelson, Arrow, and Debreu certainly do a better job grappling with the issues. If I had to pick the best person to treat every other issue you cite, I would not pick an Austrian.
The “Austrian themes” that are actually Austrian and not just “things all economists talk about” are (1.) temporal capital structures and the elongation of the production process over the business cycle, (2.) Ordinal preferences (for those Austrians that care about this issue), (3.) economics as a logical science (for those Austrians that care about this issue). There may be others, but those are the three I’m most familiar with and I run into the most, and they are genuinely “Austrian”. A lot of the other stuff that is claimed as “Austrian” really, really isn’t. It’s just plain ‘ol economics.
http://www.jstor.org/pss/2227278
You attacked me for saying it doesn’t talk about price signals and pointed otu the few price signals it does talk about, but that was never my point and you know it. It doesn’t talk about how the price of one type of capital (say flour for milling) falls relative to the price of another capital good (say nails.
It just doesn’t. It doesn’t even care about the implications of this or why it is happening.
Say it does all you like, man, and maybe in your head it does and thats cool but nowhere does IS-LM ostensiably analyze the effects of *different* prices of *different* unfinished goods fluctuating *relative to eachother*. Nor does it say anything about the *transferability* of these goods to other areas or the *costs* involved in transferring them. Nor does it say how entrepreneurs adjust expectations to these changes.
Now I know the IS-LM, the cross and other popular models aren’t the be all end all of Keynesian macro but they are the *popular* models, and this was my point. So until the popular models start talking about the things Austrians like to talk about you can’t just say “Oh man you Austrians think you are so special we talk about this stuff all the time, its old hat man”
re: “It doesn’t talk about how the price of one type of capital (say flour for milling) falls relative to the price of another capital good (say nails). It just doesn’t. It doesn’t even care about the implications of this or why it is happening.”
Right – the Keynesian mechanism doesn’t change with the introduction of these prices, so Keynesian models don’t bother with them.
To say that the Keynesian mechanism doesn’t change with the introduction of these prices is not to say that:
(1.) Keynesianism does not concern itself with economic calculation, or
(2.) These prices don’t themselves introduce important macroeconomic mechanisms.
(1.) is false on its face. All Keynesians have acknowledged the role of the price mechanism in economic calculation. This is something that all economists agree on. (2.) I think is false too and I have always said that ABCT makes a valuable contribution. The question is, how significant is that mechanism relative to the Keynesian mechanism or other business cycle mechanisms? The evidence seems to suggest the Keynesian mechanism is the bigger one to worry about. And when we model the Keynesian mechanism, a lot of these prices don’t need to be modeled (because they all react in essentially the same way).
You should not use “price mechanism” as synonymous with “time structure of production”. That was extremely confusing, and it was not clear what you meant. All economists, including Keynesians, acknowledge the price mechanism. Many Keynesians are probably unaware of the time structure of production. I consider that unfortunate, but understandable – ABCT does not appear empirically substantive enough for Keynesians to justify spending much time learning about the time structure of production. Alternatively, they can’t understand anything about the market without understanding the price mechanism.
I think our elaboration of seatement (2) confirmed my original point. 🙂
As for the second thing you said: what is the time structure of production except prices facilitating intertemporal coordination?
I also think that temporal coordination is not the only sort of meaningful coordination prices facilitate, and that these too are masked by the common macro models. Not only that, I think that the truth is far from “these prices react in essentially the same way” to the price signals the models to incorporate!
gah I should have looked over that before hitting send.
I think our elaboration = I think your elaboration.
the models to incorporate = the models do incorporate.
I think you give Austrians too much credit. This time structure of capital stuff seems crap. I can’t think of any reason one would want to give this serious attention.
Also, my comment to you below got cut off but I said:
1. There’s nothing “kooky” about Austrian economics
2. It’s [Austrian economics is] not really catching on all that much, but anti-Keynesian economics is such that even Democratic leaders (to say nothing of Republicans) are coming out vocally against Keynesian solutions
That’s great! It will hopefully mean they will no longer believe that:
1) A wave of frugality can destroy the economy [*].
2) Mass redistribution of wealth via make-work projects and inflation can help the economy [*].
3) Making long-term investments for the future, hoping to draw from the wealth thereby producted, is an activity that should be taxed to futility [*].
4) Giving people “an education” necessarily gives someone marketable skills.
5) People who prudently save for the future should be financially sodomized.
It would rock if they would abandon those trash ideas!!!
[*] in the sense of “the economy” that we actually care about.
Here Here!
Nothing kooky about Austrianism, huh? What isn’t kooky?
How does IS-LM even make sense without price signals??? How would you talk about demand for loanable funds, supply of loanable funds, or demand for money without talking about economic calculation?
When the policy makers use coercive means to establish their own arbitrary interest rates, and their own quantity of paper (digital) money, which prevents private property owners in a regime of free voluntary trade of money as against real goods and services, then it follows that the price system’s signals that result from true voluntary savings (supply of loanable funds), true voluntary time preference (interest rates), true voluntary demand for money for holding (liquidity preference) relative to the demand for money for spending/investing (purchasing power of money), are in fact PREVENTED from operating. They are distorted and not a reflection of true consumer and investor trading preferences.
Those things you list – heterogeneity, price signals, specificity, economic calculation, entrepreneurial expectations, etc. – are not “Austrian themes”. They are economic themes. Some Austrians have been so insular they’ve convinced themselves they’re the only ones that talk about this stuff.
It’s not that Austrians just talk about it, it’s that they hold that they cannot be allowed to manifest themselves in price signals because the government, and its Keynesian and Monetarist intellectuals, believe that individuals cannot manifest “rational” action individually on their own without government control, and thus they (you) advocate for government control, which Austrians hold, correctly, THWARTS the ability of individuals to rationally allocate heterogeneous capital goods, observe correct price signals, and thus prevent investors and consumers from economically calculating in a way that is consistent with consumer time preference and availability of real capital, then no, Austrians are not saying that they are the only ones merely speaking about these things. They are the only ones who are saying that they are not allowed to function properly as long as Keynesians and Monetarists influence government in such a way that the government acts against these things by setting artificial interest rates and artificial quantities of money.
Hayek is the most eloquent person I know to talk about economic calculation, but Samuelson, Arrow, and Debreu certainly do a better job grappling with the issues. If I had to pick the best person to treat every other issue you cite, I would not pick an Austrian.
Where are Samuelson, Arrow and Debreu superior in talking about economic calculation?
The “Austrian themes” that are actually Austrian and not just “things all economists talk about” are (1.) temporal capital structures and the elongation of the production process over the business cycle, (2.) Ordinal preferences (for those Austrians that care about this issue), (3.) economics as a logical science (for those Austrians that care about this issue). There may be others, but those are the three I’m most familiar with and I run into the most, and they are genuinely “Austrian”. A lot of the other stuff that is claimed as “Austrian” really, really isn’t. It’s just plain ‘ol economics.
To the extent that “Keynesian” economists speak of heterogeneity of capital, and not just in passing, but in terms of being an important enough attribute of the market to warrant inclusion in their models, to the extent that they speak of price signals, and not as something to be controlled by the state, but as a consequence of free trade of private property, to the extent that they speak of economic calculation, and not just as a secondary aspect that is enabled only by government control over aggregates, to the extent that they speak of entrepreneurship, and not just as a source of animal spirits in need of government control and temperament, to the extent that they speak of the free market process alleviating any solvable economic problem given economic reality, then these economists are NOT Keynesian qua Keynesian. They are economists who may share some of Keynes’ views, and may even base their entire intellectual program on a foundation of aggregate demand that only government can ultimately control, but their “other” views are not Keynesian.
If Keynesians had any concern about CALCULATION (ignoring REcalculation for a moment), they wouldn’t artificially lower the interest rate thereby seriously impairing CALCULATION in the first place.
Bob, as we went over in a previous post, you think we’re calling an artificially low rate “natural” and we think you’re calling an artificially high rate “natural”.
It makes no more sense for you to say that’s proof I have no concern about calculation than it would be for me to accuse you of having no concern about calculation.
We simply differ in our understanding of the interest rate.
Let’s try:
1. The interest rate voluntarily determined by free human beings in the market; vs.
2. The interest rate set (or induced) by the central bank and maintained by its SWAT teams, paddy wagons, chains and cages.
http://tinyurl.com/3cdvkvk
If you want to call #2 “natural”, I don’t know what to say.
Oh come on, Bob. If you want to engage us you have to respect the argument.
The case is that the market produces an artificially high interest rates. Central banks are the most common modern way of correcting that. Nobody has ever said that a central bank is “natural” – the point is it’s an intervention that moves the interest rate from an artificially high market rate to a rate consistent with the “natural” interest rate.
You think (1.) will lead to a “natural rate”. Our difference is over whether that assumption is true, not over whether we think economic calculation requires good price signals.
Yeah, 3.5% on a ten year loan is definitely insane (that’s almost 3000 ppm per *MONTH*), I don’t know who can possibly afford capital expenditures like that, we better knock it down to negative territory and make it so that only large banks can get that rate (i.e. be paid to use money), that’s definitely a policy consistent with good understanding of the rationing function of prices and not at at completely f***ing insane.
Hi, I’m Daniel Kuehn and I’m saying, with a straight face, that a true, productive market economy requires businesses to only pay 0.3%/month plus risk premium, and all businesses capable of affording that capital cost should continue to exist.
Also — still with a straight face — I’m going to claim I’m totally down with the idea that unprofitable businesses need to liquidate — it’s just that I think their profits should have to be *very* negative, not just mildly negative.
This is just as respectable a position as believing that interest rates are too high.
No, it’s not “just as respectable”. It’s more respectable (or at least it’s more respectable among economists – you guys are winning with the politicians).
Yeah! Free money is the most respectable position! And consistent with recognizing the role of the price system! Rock on!
If you’re worried about the republican right catching onto that kooky Austrian economics and sending the country spiralling down to become renamed to Ancapistan, then your fears are mostly unfounded.
1. There’s nothing “kooky” about Austrian economics
2. It’s not really catching on all that much, but anti-Keynesian economics is such that even Democratic leaders (to say nothing of Republicans) are coming out vocally against Keynesian solutions.
What is “artificial” about a free market price/interest rate? It’s the price at which people with money have decided to lend to people who want to borrow who have also agreed to that price of borrowing. How can it be “too high”? Too high for whom? Who decides that? How? Why are they entitled to do something about it?
It may not necessarily be optimal for your nefarious plans, but it is what it is. And we don’t know what it is until people actually engage in the transaction.
If you want to expressly argue that people will screw up their lives if left to their own voluntary transactions and devices and need a benevolent Clintonista SWAT team to guide them, just say so.
If you’re just going to call me nefarious I’m done, Bob. Grow up.
If it involves force, it’s nefarious. All libertarians think that whether they say it or not.
Force isn’t a la-di-da option among many other options. It’s not really on the table. If you are going to suggest force, understand our natural reaction and that you better have a damn good reason for inflicting it on someone.
One reason we are so cocky and unforgiving is that we understand what cannot be known and we know what should not be done and insist it not be done. That analysis is pretty simple and I fail to understand why our opponents don’t seem to get it.
What is the “natural rate”?
“The case is that the market produces an artificially high interest rate.”
As B. Roddis, and Silas, and Avram, and Yancey have asked — in one form or another — what is the natural interest rate if not the interest rate established by the market?
Mr. Kuehn, for the sake of argument, let’s assume that you are correct and that the market rate is artificial:
How do you know that: artificial = wrong?
How do you know that: artificial = too high — as opposed to too low?
How do you know that a rate generated by individuals making free decisions (the market) is “worse” than a rate generated by a handful of men?
How do you conclude that the infinitely different number of biases in the free market do not have a cleansing effect, thus making the market interest rate pure, natural, and accurate, while simultaneously concluding that the handful of men making policy decisions, who have statistically similar/identical biases, are not warped in any way by their said bias and that they can reach the more perfect/natural rate?
See below.
I’m not sure if “wrong” is the right word… it’s inconsistent with a full employment economy and potentially even with market clearing prices. Is that any more “right” than a full employment market economy?
Is there anything “right” about full employment requiring zero cost of capital despite capital’s scarcity?
I don’t know about you, but any economy that depends on capital being (manipulated to the point that it is) free, is not an economy I care about, and if that’s the kind we have now, I’m all for a total overhaul of it so we can build on a better foundation.
Seriously, how can you defend an economy so brittle that it stops working when large banks can no longer get free or ultra-cheap money? What universal constant requires an economy to be like this?
“The case is that the market produces an artificially high interest rates. ”
I cannot believe I just read that.
I am shocked. My jaw just dropped to the floor.
That’s all I wanted to say.
Mr. Kuehn:
In your response to me, you said: “See below.” Then, you added to your answer by saying that the interest rate set by the market is not consistent with full employment.
I have a few problems with your response. First, when I read all of the below-referenced responses, I did not find any suitable answers to my questions. So, either you think that my questions are not worthy of answering (because the answers are obvious) or you cannot answer them. I will assume the former; this way, we can continue to have a healthy discussion.
Second, you mention that an interest rate established by the market is inconsistent with full employment and, potentially, market clearing prices.
That answer, however, leads me back to my earlier questions. Furthermore, assuming that your answer is correct, what makes you think some men in a conference room can do better? Why would you trust these men? Why would anyone trust these men?
Let’s continue under the assumption that the interest rate established by the market is inconsistent with full employment. Is “full employment” a linear function based solely on the interest rate? Let’s assume that I am unemployed and living in Florida. If I hear of a great job in California, but I am deathly afraid of earthquakes, there is no interest rate that will ever make me move.
This is a silly example, but I use it to show that a host of factors — many of them unknown – work to create full employment.
One more question: At what point in the history of the United States have we seen a “market-generated” interest rate? I am not saying that it has not happened, for I do not have a complete-grasp on the history of the Federal Reserve, nor do I have a complete grasp on the history of the monetary and fiscal policy of the United States. I am saying that the Fed has been setting interest rates for a long period of time. So, maybe the bugaboo of less than full employment should be blamed, in part, on the Federal Reserve, not the market, since the market, in fact, is not the entity that is setting the interest rates.
The case is that the market produces an artificially high interest rates.
Daniel, when people voluntarily set a “high” interest rate, meaning the rate they set without state intervention, then that rate is not “artificial”. That rate is NATURAL, because it was set by voluntary means.
How in the world can you call the free market interest rate “artificial” and the state controlled rate “natural” (or getting it closer to what the “natural” is supposed to be), unless you have already presumed that the state’s control over money and interest rates is natural and free markets are artificial? You completely reversed the meaning of terms as they are traditionally held.
Artificial means extraneous to the free market, and natural means intrinsic to the free market. Sure, you can redefine words if you want, but you can’t honestly do that in debating knowing that the definitions others are using are completely opposite to your own and you redefine them without even making that redefinition explicit, leading others to think by “artificial” you mean the same thing they mean.
You have to make explicit what you mean by natural rate of interest and artificial rate of interest. To Austrians, the natural rate is WHATEVER rate is set by voluntary means only, that is, without any state intervention in setting interest rates through the central bank. Artificial is central bank set interest rates.
Why does “natural” and “artificial” mean the opposite to you?
It’s not the opposite. He’s making the point (I think) that if unemployment is higher than it should be and demand is lower than it should be the rate is not natural, and therefore too high. The idea is that the market is not working correctly and the technocrats need to make it.
Of course I think that view is troubled when nominal short rates are almost zero (real rates are negative) and there is still unemployment, slack, and below potential demand. Essentially people are being paid to borrow and they won’t.
Clearly there are other issues keeping people from spending/investing in the current interest rate environment. Maybe it has something to do with after-effects of a credit deflation, impaired collateral values, shaken investor psychology, fear over fiscal/monetary policy, commodity inflation, a drop in labor participation etc.
It’s not the opposite. He’s making the point (I think) that if unemployment is higher than it should be and demand is lower than it should be the rate is not natural, and therefore too high. The idea is that the market is not working correctly and the technocrats need to make it.
This view ignores the actual cause for widespread unemployment, which according to the Austrians, is artificially low interest rates set by the Fed in past periods, which sets the economy on an unsustainable boom and inevitable recession and thus unemployment.
Whenever someone says things like “what unemployment OUGHT to be,” and “what the interest rate therefore ought to be,” it’s a warning signal that the speaker presumes the state should have control over interest rates as a matter of principle, and that the state’s control is not the cause for why there are problems in the first place.
As Hayek said, if you don’t know how the free market can work, you can’t know what will stop it from working.
Keynesians don’t know how the free market works. They reject it as a matter of prejudice. That is why they are so blind to what causes economic calamity.
Interesting!
I just read the first page, but I think he’s making an important point. I’ve never understood exactly how people would expect ordinal utility and the action axiom to come to a different position than cardinal utility and constrained optimization. Both seem to me to say “keep doing X until it is no longer the prefered option”. So I don’t see why some people get worked up over ordinal vs. cardinal. I simply prefer cardinal because you can do more with it analytically.
Neat – thanks.
This was supposed to be a comment on Bob’s jstor link.
So I don’t see why some people get worked up over ordinal vs. cardinal. I simply prefer cardinal because you can do more with it analytically.
This sounds like yet another example of non-Austrians claiming to have more knowledge than that actually have or even can have. Then they run off with it concocting more of their baseless “models” to inflict upon us.
So I don’t see why some people get worked up over ordinal vs. cardinal. I simply prefer cardinal because you can do more with it analytically.
So I don’t see why some people get worked up over “you didn’t lose your keys under the streetlight!” I simply prefer searching under the streetlight because you can do more with it optically.
Silas, my whole point is that the street-light is not wider for ordinal than it is for cardinal utility and they amount to the same thing. So why choose ordinal utility?
If cardinal utility implied a narrower street-lamp, obviously I wouldn’t embrace it.
If cardinal utility implied a narrower street-lamp, obviously I wouldn’t embrace it.
Considering your history and penchant for embracing fallacious positions, it is not “obvious” that you would reject fallacious ideas such as cardinal utility.
Cardinal utility does in fact imply a narrower street lamp, because it leads to ignoring many economic truths on the one hand (the dark area that is not visible), and leads to presuming more economic knowledge than exists on the other hand (the same dark areas that are not visible).
It leads to ignoring the fact that trade is mutually beneficial and implies that trade of goods requires goods of equal value. It leads to treating the price system not as primary method of economic calculation by placing the numbers used for cardinal utility as primary instead, where the price system becomes an image for control so that the cardinal utility numbers can be manifested in the way the advocates think is “rational.” It leads to ignoring the fact that trade of goods are trades of oppositely valued goods according to ranking of value, which enables one to see that even money is ranked in relation to real goods, which allows one to see that holding money as cash rather than being spent is economically beneficial, instead of destructive.
On the other hand, it leads to presumed knowledge that does not actually exist, by leading people to believe that goods have an intrinsic value instead of only subjective value as is true in reality. It leads people to think that goods are valued in terms of intensity of utility, which leads people to think that confiscation or loss of lowly cardinal valued goods for one person, the owner, is not economically destructive, as long as someone else who receives those goods attach higher cardinal valued utility to those goods.
In fact, that’s really not even it – the point is ordinal and cardinal utility offer conceptually the same explanation of human behavior, but cardinal utility offers a wider streetlight than ordinal utility does.
Just teasin’ you, man. Focus on defending your position about 3.5% interest rates (and 0% on savings) being monstrously excessive.
Sorry – didn’t realize that was confusing. I’m using it in what I guess you’d call the Wicksellian sense of the rate that clears the loanable funds market.
Bob Roddis thinks I’m embracing artificial interest rates that hamper economic calculation.
I think he’s embracing artificial interest rates that hamper economic calculation.
The difference is, I seem to be able to recognize that he at least has the goal of restoring market calculation and values market forces, and that his departure from market calculation is inadvertent on his part. For some reason, he is unable or unwilling to recognize that in me – and not only that, he goes beyond that and calls me “nefarious”.
People like that should not be taken respected or taken seriously unless they respect and take other seriously.
How can an interest rate set or induced by bureaucrats at the point of a gun be “natural”?
And if you think savers should receive a return of 0% + risk premium for investing their money, you clearly have no clue, contrary to your claims, about the function of prices. Scarce stuff should carry a price. Loanable funds are scarce, yet they don’t carry a price. You claim they should carry a *negative* price, and also that your position is worth considering at all. That’s what I don’t get.
I would just settle for a definition of what the “natural rate” of interest is in Kuehn’s opinion.
Great question. Keep asking. Also, how would the magic bureaucrat know how and where to properly set it? What data would he need?
If the Keynesian “natural rate” is indeed the one corresponding to full employment, then unemployment at 0% nominal rates are tough to explain. The lever isn’t really hooked up to what the model says.
Never mind that maintaining full employment might actually be difficult or what might be sacrificed in attempts to achieve it.
If the Keynesian “natural rate” is indeed the one corresponding to full employment, then unemployment at 0% nominal rates are tough to explain.
It would be tough to explain if the natural rate (in Mr. Kuehn’s sense) could never be negative. But why assume that? Particularly if you have deflation, the idea that the natural rate might be negative seems fairly plausible (for further elaboration on the point, see here).
I don’t want to speak for Mr. Kuehn, but I believe he’s previously stated that he considers the natural rate to be the one at which the market clears.
In fact, that’s really not even it – the point is ordinal and cardinal utility offer conceptually the same explanation of human behavior, but cardinal utility offers a wider streetlight than ordinal utility does.
Not true. Ordinal utility offers a wider street lamp than cardinal utility because it is based on actual reality. Cardinal utility is a mathematical arrogance that presumes to know more than what the ordinal street lamp brightens up, when in reality it knows less, because it is ignoring what the ordinal lamp is brightening up, and believes the dark is light simply because numbers are attached to the utility of goods.
“Mark Thoma leads us to new research from the San Francisco Fed showing that recent college graduates have experienced a large rise in unemployment and sharp fall in full-time employment, coupled with a decline in wages. Why is this significant?”
Despite the growth and high wages in the IT sector of the economy, less and less students are going that way. There could be a social factor as to why new graduates aren’t getting jobs. Too many English majors won’t fill up those jobs in demand.
Maybe the decline in wages is part of this recalculation?
Another question: why take a new graduate that’s unemployed over someone who has experience in that sector?
Yeah, I remarked on Krugmans blog that there’s a huge disconnect between “college-educated” and “skilled”. These days, the former usually means “prevented from acquiring skills for several years”. And likewise, saying that someone is college educated doesn’t distinguish between engineering/comp sci, in which you learn marketable (though general-use) skills, versus art history majors, who just flushed thousands down the toilet (or hundreds of thousands if you’re Kelli Space).
Not to say they deserve this fate — they were just going by the conventional wisdom.
Regarding my use of the term “nefarious”……
Over at the Yglesias blog, I have my very own identity thief who invariably responds to my critical comments and thereby demonstrates the breadth and depth of “progressive” thought on economics. Here is an example of his work:
http://tinyurl.com/3paujdu
This guy also tried to hack my Facebook account requiring me to get a new password. He’s also created a new Facebook account in my honor with Bob Roddis as a female.
http://www.facebook.com/people/Bob-Roddis/100001547038791
The rest of the Yglesias commenters generally respond to any point I MIGHT make with brilliant arguments like “GGGGGGGOOOOOOOOLLLLLLLLLDDDDDDDDDDDDD”.
I don’t think my use of the term “nefarious” here, especially to emphasize our opposition to the callous use of force by “progressives“ and Keynesians, is a big deal.
Huh?
What does that background story have to do with the fact that I sure as hell am not going to respect you if you think I have nefarious goals?
And now “callous”?
Ya, sorry. I would never do what this hacker did to you. I have no clue why that hacker’s activities should make me respect you more when you clearly don’t respect me.
Speaking of respectful disagreement, here is KRUGMAN THE MASTER himself this week on Tom DiLorenzo:
But first, let’s talk a bit more about that list of witnesses, which raised the same question I and others have had about a number of committee hearings held since the G.O.P. retook control of the House — namely, where do they find these people?
My favorite, still, was Ron Paul’s first hearing on monetary policy, in which the lead witness was someone best known for writing a book denouncing Abraham Lincoln as a “horrific tyrant” — and for advocating a new secessionist movement as the appropriate response to the “new American fascialistic state.”
http://www.nytimes.com/2011/04/04/opinion/04krugman.html?partner=rssnyt&emc=rss
Here DeLong respectfully examines Mises’ work:
My view is that Money and Credit is very readable–compulsively readable, in fact: I have just spent two and a half hours telling myself “it’s OK; I will just read one more page…”. But it is only readable in a rhetorical-excess-train-wreck mode, for it is also totally bats— insane.
http://delong.typepad.com/sdj/2008/12/when-reactionar.html
Even more respect from DeLong:
In his lecture delivered January 5, 2009 in Singapore, “The Financial Crisis of 2008-2009: Understanding the Causes, Consequences—and Possible Cures,” he fabricates a “Marx- Hoover-Hayek axis” (complete with adjoined photos of this unlikely trio) and then offers a brief and ill-informed critique under the heading “The ‘Austrian’ Story in a Nutshell.”
http://www.auburn.edu/~garriro/mainstreammacro.pdf
Here, Yglesias respectfully disagrees with Ron Paul and Tom Woods:
Bored by the proceedings at the Republican National Convention in St. Paul one day in 2008, I decided to try to gather some color down the road in Minneapolis, where Ron Paul and fellow dissident conservatives and libertarians were holding a counter-convention at the Target Center. At one point a speaker thundered that Barack Obama and John McCain “both have a lot to learn about Austrian business-cycle theory.” The crowd went delirious with cheers, and soon chants of “end the Fed” echoed throughout the arena.
It was funny at the time. A BUNCH OF CRANKS talking about their CRANK MONETARY THEORIES and espousing a CRANK PRESCRIPTION.
Today, Paul is the chairman of the House Subcommittee on Monetary Policy.
http://www.democracyjournal.org/20/fed-up.php
Bob, in case you haven’t read it, here is a great takedown of Yglesias by Tom Woods.
http://www.lewrockwell.com/woods/woods166.html
Bob Roddis,
Do you really want to be taking your cues on civility from Krugman and DeLong?
I’m not taking cues. I used the word “nefarious” and I meant it in a substantive manner. Mr. Kuehn needed and still needs a reminder that the use of force is not la-di-da “ok” and that his policies are based upon it. Further, Mr. Kuehn was published in “The Review of Austrian Economics”! He is being treated quite well here dispite the evident frustration of the Austrian commenters caused by his failure to give straight answers.
I was just comparing our treatment of him with the opposition’s almost universally vicious, ignorant and hateful treatment of us.
Sushi
Krugman appears to be arguing against the idea that sectoral imbalances are the one and only cause. To be fair to him I don’t think he would say that sectoral imbalances and underdemand are mutually exclusive.
You are EXACTLY right on this, Bob.
I remember reading a long post showing how those stupidz Austrianz or is it Australians(?) don’t understand Aggregate Demand, and that this recession has nothing to do with sectoral shifts. The chameleon changes colors seamlessly!
By Delong that is
Speaking specifically towards Krugman’s question concerning labor market shortages, anyone can go to the Occupational Employment Statistics at the BLS and get the information. http://www.bls.gov/oes/oes_arch.htm
Comparing the growth rate (May 2006 – May 2009) for several occupations in Nevada and Texas:
For Nevada
Occupation Employment change Median Hourly Wage
Dental Assistants 3% -7%
Funeral Directors 40% 10%
Bookkeeping, Acct’ing, and Audit Clerks -7% -11%
Brickmasons and Blockmasons -29% -1%
Carpenters -46% 28%
Carpet Installers -40% -2%
For Texas:
Dental Assistants 2% 18%
Funeral Directors 20% 28%
Bookkeeping, Accounting, and Auditing Clerks 2% -11%
Brickmasons and Blockmasons 6% 2%
Carpenters -4% 7%
Carpet Installers 1% 7%
Bob Wenzel examines Krugman’s rhetoric:
Paul Krugman on Paul Ryan is Pretty Close to Paul Krugman on Paul Krugman
Krugman writes:
A correspondent asks how it’s possible that Paul Ryan would release such an extreme, unprofessional plan. Folks, he’s always been like this. The image of Ryan as a thoughtful, serious conservative never had any basis in reality. The original “roadmap” was just as nonsensical as the new proposal; the Ryan-led attack on health reform was crude nonsense.
Ryan the serious deep thinker was a fantasy of Beltway types who think entirely in terms of images and perceptions, and can’t be bothered to dig into the policy details. Oh, and the haplessness of Heritage is also old news to anyone who has been paying attention to the think tank’s actual output.
After reading this, I thought to myself, all true. Then I looked at the words again and realized that you could substitute
“Krugman” for “Ryan”
“regressive” for “conservative”,
“NYT” for “Heritage”,
“attack on Austrian economists” for “attack on health reform”,
“rag’s” for “think tank’s”
and you would have a pretty good description of Krugman.
http://www.economicpolicyjournal.com/2011/04/paul-krugman-on-paul-ryan-is-pretty.html
Also, just a suggestion but why don’t we move all continuing comments down here away from being crammed against the right margin?