Krugman Is Very Influential–Except When It Comes to Economic Policy
Way way way back on July 3, Krugman wrote a post with the sarcastic title “Nobody Pays Any Attention to What I Say.” Here’s the gist of it:
Or that’s what people keep telling me. Actually, one of the odd but revealing things about modern conservatives is the way they alternate between paranoia about the vast left-wing conspiracy and insistence that people who disagree with them are part of a tiny fringe with no real following…
So, on the general principle that if I am not for myself, who will be for me: that left-wing rag the Wall Street Journal has a new assessment, based on some supposedly objective criteria (but not including Twitter followers) of the most influential business thinkers. They see a big change since the last time they did this, five years ago…This time, the top thinkers are:
1.Paul Krugman
2. Joseph Stiglitz
3. Bill Gates
4. Michael Porter
5. Thomas Friedman
6. Eric Schmidt
7. Richard Branson
8. Malcolm Gladwell
9. Robert Reich
10. Jack Welch
11. Muhammad Yunus
12. Niall Ferguson
13. Michael Dell
14. Howard Gardner
15. Jimmy Wales…
Something else…is that the list isn’t just heavy on economists; it’s heavy on liberal economists. I don’t think that’s an accident, and I don’t think it’s purely political. The fact is that in an era of markets gone massively bad, conservative economists don’t have much to offer except excuses.
At the time, I thought this was an odd post. Perhaps the single person on Earth most responsible for the idea that nobody listens to Paul Krugman is…Paul Krugman himself. Think of how he always laments about the Very Serious People listening to the allegedly discredited R&R, John Taylor, Allan Meltzer, even though they’ve “been totally wrong about everything” since the crisis began, etc.
I was going to go find some of these recent posts, to give an example of what I mean, but fortunately today (July 5, a full 48 hours after the above), Krugman writes:
We had what felt like an epic intellectual debate over austerity economics, which ended, insofar as such debates ever end, with a stunning victory for the anti-austerity side — and hardly anything changed in the real world. Meanwhile, the pain caucus has found a new target, inventing dubious reasons for monetary tightening. And mass unemployment goes on.
So how does this end? Here’s a depressing thought: maybe it doesn’t.
OK great. When the depression fails to end, according to the July 3 post, I am going to blame it on the highly influential liberal economists like Krugman, Stiglitz, and Reich. If Krugman then comes back and says, “No no no, nobody listens to what I say, that’s why we are mired in depression,” we can then point out his odd and revealing alternation between smug pride over his influence, and paranoia about people ignoring him.
Inconsistency and hypocrisy are the only bows left in Krguman’s quiver. But he’s an incredibly prolific marksman despite such a limited arsenal.
So in the July 3 post, Krugman is talking about the WSJ list of who businesses listen to (according to the the article in question): “Meanwhile, the financial crisis has made economic insight valuable to businesses and consumers alike”
In the July 5 article, Kruman is lamenting that policy makers (ie the VSPs) in charge are ignoring him and his side: “I guess what I’m saying is that I worry that a more or less permanent depression could end up simply becoming accepted as the way things are, that we could suffer endless, gratuitous suffering, yet the political and policy elite would feel no need to change its ways.”
Where is the inconsistency or alternation? Businesses are listening to Krugman while the political/policy class is ignoring him. It seems to make sense that if you want to point out the foolishness of a certain group ignoring your advice that you would mention when another group actually listens to you.
Yes, Yosef, Murphy is taking these Krugman posts out of context.
This blog is failing to the dismal level of Krugman-in-Wonderland: straw man arguments and simply distorting Krugman’s comments as a stock in trade.
My post title is, “Krugman is very influential–except when it comes to economic policy.” That’s exactly what Yosef said is the correct interpretation of Krugman’s two posts.
“If Krugman then comes back and says, “No no no, nobody listens to what I say, that’s why we are mired in depression,” we can then point out his odd and revealing alternation between smug pride over his influence, and paranoia about people ignoring him.”
Which means that this statement has essentially no substantive point whatsoever, since it reveals no contradiction or hypocrisy from Krugman who could have pride if some business people are listening to him but also worry when influential policy-makers have not followed his advice on pursuing much greater fiscal stimulus?!
Lk,
Show me where “businesses” are the primary driver of those rankings. Show me where the WSJ poll rankings demonstrate that those “listening” are sympathetic to the views of the people on the list.
The substantive point is that it is weird to be all smug about how much influence you have when that influence is meaningless as far as getting anything done.
I wouldn’t go around bragging how influential my opinions are on the Bulls offseason moves in free agency if that influence didn’t involve anyone in the Bulls organisation. Who cares if all my friends are influenced by my brilliant offseason trade suggestions if Gar Forman doesn’t listen to a thing I have to say. I don’t see any reason to be smug about inconsequential influence.
Dan wrote:
I wouldn’t go around bragging how influential my opinions are on the Bulls offseason moves in free agency if that influence didn’t involve anyone in the Bulls organisation.
But to be truly analogous, you would have to do that, *plus* you’d have to write a blog post making fun of people who said you weren’t influential when it came to the Bulls.
Yeah, Krugman’s a trip.
Dan, suppose someone is really influential with the Heat’s gaming decisions, and complains how people on the Bulls don’t listen to him. Would that be ridiculous? Suppose also that the advice and predictions this person has been giving the Heat have been accurate, but when he gives the Bulls advice he is ignored. Would pointing out his influence with the Heat, in chastising the management of Bulls be wrong?
That is what is happening here with Krugman being influential, according to the WSJ article, with some groups but not policy makes. He is influential with the Heat/Business, has made good predictions, but is ignored by the Bulls/Policy makers.
Yosef,
“Suppose also that the advice and predictions this person has been giving the Heat have been accurate, but when he gives the Bulls advice he is ignored. Would pointing out his influence with the Heat, in chastising the management of Bulls be wrong?”
>> There was ZERO mention of accuracy or sympathy to the views of those in the list in that WSJ poll. Popular != accurate or correct.
“That is what is happening here with Krugman being influential, ”
>> No, it is not.
“He is influential with the Heat/Business, has made good predictions, but is ignored by the Bulls/Policy makers.”
>> Wrong. He is popular with the “fans,” not the “Heat/Business” and there is ZERO relevance to “good predictions” here (that’s not being debated/discussed), and he is being ignored by the Heat management/ownership. No need to confuse this by bringing in another team.
You are using the wrong analogies.
Yes, Yosef, if you change the scenario to somethibg where Krugman’s influence isn’t inconsequential, unlike the situation described in this post where he is influencing people who have zero control over what he is influencing them about, then it wouldn’t be weird to brag in that scenario.
Why is Krugman touting how great liberal economists are if nobody is listening to him (and them)?
In that same post he wrote that conservative economists are not influential because they do not have much to offer.
Does this mean Krugman will now write that he doesn’t have much to offer because nobody is listening to him?
Richard, it’s not that “nobody is listening to him (and them)” but rather that policy makers aren’t listening to them, but they are being listened to by businesses. So some groups are listening to him, but not the group he wants most to listen to him.
Yosef,
I know you think Krugman was only talking about policymakers. That is the only way you can make you critique of Bob’s post work.
But you didn’t provide any evidence of this i.e. a previous post where Krugman explicitly said this. You just showed how Krugman could reconcile his posts.
But, in reconciling the posts, it suggests that Krugman has consciously making this distinction all along. If so, it would be odd that he would then say that conservative economists have no influence (over business people) because they have nothing to offer. He would only raise the same question wrt the lack of influence he has had over policymakers.
If you put up evidence – ok – then you have Bob here. But, then, we still have Krugman.
Bob, given the title of your post, and it’s agreement with my (correct) interpretation of Krugman’s posts, how could you then blame the liberal economists for the depression failing to end (as you say at the end of your post)?
If Krugman is not influential in economic policy, why would he be blamed when economic policy fails to end the depression?
“So in the July 3 post, Krugman is talking about the WSJ list of who businesses listen to (according to the the article in question): “Meanwhile, the financial crisis has made economic insight valuable to businesses and consumers alike”…. “Businesses are listening to Krugman while the political/policy class is ignoring him.”
>> How do you extrapolate from the WSJ article that “businesses” are the primary driver of these rankings? Here’s the only mention of how these results were tallied (unless I missed something): “The findings – based on Google hits, media mentions and academic citations…” So, yeah… just as the article is titled, these “celebrities” are being “found” more these days and, in particular, I’m sure Krugman’s high ranking is bolstered by his NY Times blog, daily spotlight on HuffPo, regular Sunday morning talk show circuit, and his political partisan punditry and antagonistic style making good copy for popular media outlets.
I agree that this isn’t necessarily an inconsistency, rather just his typical emotionally-regressed whining about being popular without effecting policy as much as he’d like. And while I’m not ascribing the following to your comment, it’s worth mentioning that this WSJ poll (that Krugman references in the July 3 post) demonstrates nothing about whether the pop star celebrity-style popularity of those on the list is a vindication of their views nor that those who are listening are necessarily sympathetic to those views. Thomas Friedman is #5 for crying out loud! Should policy makers be listening more to Friedman?
Right On, Yosef,
But many people who are part of the “pain caucus” the sadists who love to inflict pointless suffering for no valid reason whatsoever, are on this site. So good luck in getting them to listen to you
We are very evil indeed.
But let’s not act like Krugman or his policies have no influence.
Where is any meaningful evil policy being implemented? Most of the world is still spending more YoY. Yet, austerity is being defined as less growth in spending. Doing “only” 90% of what Keynesians want isn’t austerity. When budgets and taxes are cut in half, then you can start blaming the pain caucus.
If we just grow government spending as we did in the 30’s and 40’s we will “only” have a 15 year long depression. The bar has been set.
When you insult Austrians by claiming they only want to hurt people, you are not giving them any reason to listen to you.
Does that makes you a Sadist?
“But many people who are part of the “pain caucus” the sadists who love to inflict pointless suffering for no valid reason whatsoever, are…”
Inflationists such as yourself.
The problems arise during the boom, the bust is the cure.
You have an understanding of reality that is opposite to what is truthful.
Wow, I got whiplash reading that.
It doesn’t matter what happens. As RPM often states, Kruggy can always say we just needed more Keynesian alcohol (worse than we thought etc). At some point, one would think, an honest individual would take responsibility for their policies.
Foresight vs Hindsight.
Kruggy makes recommendations in foresight and excuses in hindsight. Can Krugman for just once take a stance that he can be held to? If the US tanks, then it will be the sequester’s fault. If it recovers then it will be because of sufficiently large deficits.
There is another point to be made, and it is one I have unfortunately never heard (in its specifics) from an Austrian(apologies if I missed one).
Austrians love looking at the 20-21 depression and Harding’s response to it. Some critics of this notion have said, “yea, but Harding’s cuts were almost entirely in military spending”.
To which I say “EXACTLY!”
Kruggy wants mock alien invasions, thus a significant Increase in military spending. Harding cut, arguably, the most wasteful spending on gov’t books, instead of staging mock alien invasions.
Harding cut military outlays by some 83%. Total outlays cut by about 50% (again mostly military). Unfortunately military spending no longer makes up such a significant percentage of total outlays as it did in 1920. Our budget is essentially untouchable in any meaningful sense.
So it isn’t that Harding was some shining light of laissez faire. He avoided the Keynesian urge to “just do something.” Most importantly he did the inverse in regards to military spending. (i.e. spend $40 vs lose $40, a difference of $80).
Surely someone has told Krugman that we were in two wars while he was making the alien invasion recommendations? If someone has an article written by Krugman explaining why 2 wars didn’t prevent a recession or get us out of it, I would be very happy to read it.
MMT: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it, as long as inflation remains at low to moderate levels.
Krugman: There is no financial crisis so deep that a sufficiently large alien invasion cannot deal with it.
Austrian: There is no financial crisis so deep that a sufficiently large tax cut or spending decrease cannot deal with it.
That is so totally not true. Austrians recommend that if government is sensible about balancing their budget in the first place and are careful not to allow the banks access to open ended state backing in the first place then you won’t get a financial crisis.
Was only mean to fit the flow of the other 2, and was meant towards Austrian cure to current ailments.
A financial crisis can still occur. But yes under a Jacksonian sized government…. what is there to cut.
The findings – based on Google hits, media mentions and academic citations
That certainly proves effective Krugman “influence” all across society in the belief that bad times caused by funny money dilution and unpayable government debt are cured by even more funny money dilution and unpayable debt.
Meanwhile, those evil aliens, the Salonians, whine that “Obama should have listened to Paul Krugman”.
http://www.salon.com/2013/07/05/obama_should_have_listened_to_paul_krugman/
Re: “Media mentions”.
I truly shocked that the MSM would mention statist “economists” more than non-statist economists. You too?
And so you should, that’s exactly correct.
Krugman started building his failure narrative a few years back, here:
http://www.nytimes.com/2011/03/04/opinion/04krugman.html
Thus, giving him the opportunity to claim credit for anything good that happens, while blaming the awful Republican “austerity” (which means whatever Krugman wants it to mean, but he never firmly defines it so he can never be pinned down on it) for anything that might go wrong.
It’s a political operation, nothing to do with being an economist.
Of course it’s only fair to point out that Krugman also believes in the Confidence Fairy when it suits him, but apparently only he knows what makes her happy.