Krugman Rejects Fear-Based Rhetoric, Except for Climate Change
This is my post at IER that went along with the commentary on Episode 10 of Contra Krugman. For the best line, first I need to set up Krugman’s claim:
Finally, terrorism is just one of many dangers in the world, and shouldn’t be allowed to divert our attention from other issues. Sorry, conservatives: when President Obama describes climate change as the greatest threat we face, he’s exactly right. Terrorism can’t and won’t destroy our civilization, but global warming could and might. [Bold added.]
My response:
Beyond being guilty of the exact same fear-mongering that his column supposedly criticizes, notice that Krugman isn’t even being consistent: Even the most over-the-top warnings about climate change destroying civilization play out over the course of centuries. So is Krugman saying terrorists in the next 200 years can’t figure out ways to accelerate climate change? What if ISIS recruits millions of people around the world to set trees on fire for the next century? After all, that’s a lot less dangerous than other types of terrorist missions.
From the Comments, Quoting Myself on the Gold Standard and Scott Sumner
Apparently I do a great impression of a sphinx. This comment might clarify what I was trying to get across in my previous post:
E. Harding now we go from “the monetary deflationary shock so obviously caused the Great Depression that it’s hard to deny it” to “it didn’t matter”? That’s a lot of goalpost moving.
My whole OP is showing that a deflationary shock because of gold can’t be the primary cause of the GD, because such shocks happened several times during the prior decades. It would be like blaming the Russian plane crash on gravity.Here, the 1920-21 episode had far worse deflation in the opening years than any period in the GD. And yet it was over in 2 years; the decade was “the Roaring Twenties.”
Look, all I’m doing here is the same trick that Sumner uses to show that the 1929 stock market crash can’t be the explanation. He points to the 1987 stock market crash, says it’s bigger and no Depression, so therefore that couldn’t be the reason. [Note that the link I give is not the most succinct place where Sumner has made that argument, but he has indeed made it.]
So I’m doing the same thing with the gold standard.
Sumner, the Gold Standard, and the Great Depression
Scott Sumner’s new book on the Great Depression is coming out December 1. This is definitely something I will get and digest next year, as I’m swamped. I believe the blurbs when they say this will be a classic in the field. Among other things, Scott has (apparently) interspersed newspaper clippings and real-time financial market reactions to various events, which is not something economic historians often do.
Now to be sure, Scott has a very nuanced theory of how various factors came together to produce the Great Depression. And yet, the title of the book is The Midas Paradox. And here is Tyler Cowen’s summary of the book in his list of the best of 2015: “Boo to the gold standard during the Great Depression.”
Now let me step back and make some big-picture observations:
(1) The classical gold standard was in place from (say) 1880 – 1914, and much earlier depending on your definition. But it broke down during World War I and was replaced with something weaker, the Gold Exchange Standard, which itself broke down in 1931 (all explained at this link). Various countries started “going off gold” through the 1930s, with Japan, Germany and Great Britain doing so by 1931. FDR devalued the dollar in terms of gold in 1933. And yet “the Great Depression” typically refers to the entire decade of the 1930s.
(2) None of the financial panics that occurred during the classical gold standard turned into the Great Depression. It was only in the midst of the other interventions–particularly high-wage policies–that Sumner discusses, did we get the Great Depression.
(3) The Great Recession, which according to some metrics is the worst economic calamity second only to the Great Depression, happened when all the countries were on fiat money–so no link to gold whatsoever–yet had plenty of other government regulations on labor markets and the financial sector.
To me, this is a bit like writing a book called The Steam-Powered Curse, showing how the railroads caused the Great Depression.
Potpourri
==> No other economist comes up with stranger blog ideas than Nick Rowe.
==> These people are shameless.
==> Rob Bradley pushes back against climate alarmism. (If you’re thinking, “C’mon Murphy, who are these ‘alarmists’ you keep talking about?”–see the previous link.)
==> David Beckworth wants Congress to rein in the wild Fed (sort of).
Contra Krugman Episode 10: Terrorist Attacks Aren’t Good for the Economy
Oh this was a fun one, with guest Scott Horton. I didn’t work it into the episode, but let me take the time here to note that my refined analogy (about you trying to decide whether to fix your car or cut the lawn, and then someone sets your house on fire and snaps you into action) was based on a point Silas Barta made several years ago, when we were arguing about the broken window stuff.
The Problem of Pain
That of course is the title of a famous CS Lewis book. Here let me make two observations:
(1) For believers, suppose that when you die, you realize that all the bad things in your life steered you into the type of person you yourself wanted to become.
(2) Given that humans were going to experience some type of pain in the world, it was then necessary for God to endure agony Himself. So not only did God Himself suffer torture and execution on a cross, but He also witnessed His only Son being tortured and executed by evil men. That’s pretty awful. So God’s plan doesn’t conveniently place the burden all on the humans.
Drone Operator Whistleblowers
I heard this episode of “Democracy Now!” during my trip to Houston today. Some serious stuff, I encourage you to have this playing at least in the background.
A Revealing Misunderstanding
This is actually kind of interesting. I made this wiseguy FB post:
What I meant was, it puts you in such a good mood to hear “Merry Christmas Darling” or “Walking in a Winterland,” that it would make the fighters chill out and lay down their arms. The extra joke of course was that they obviously wouldn’t celebrate American Christmas.
But the people in the comments were saying stuff like, “Nickelback” and “Yeah they’d get so depressed they’d kill themselves.”
So people clearly thought I meant that it would be a weapon.
Now, I don’t think it’s because my taste in music is off. (I like Barry Manilow too, but I understand that he is the butt of jokes.) I think the reason this joke missed is that people just assumed that if I had a plan to do something with this group, it involved killing them.
Whereas in my mind, especially with the persona I’ve cultivated with my FB jokes over the years, I thought it was obvious that I would come up with a solution that everybody would endorse. As if I were called in to negotiate a labor dispute, not stop terrorists.
I’m being serious, I think most people vastly underestimate the number of situations where there are decent non-violent outcomes. I’m not in the post going to give my plan to neutralize terrorists, I’m making a general observation.
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