The Other McCain

"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler

Krugman, STFU!

Posted on | August 1, 2011 | 28 Comments

by Smitty

Sitting There Feeling Useless sits Paul Krugman, unable to grasp that the American people aren’t buying his swill.

The worst thing you can do in these circumstances is slash government spending, since that will depress the economy even further.

Can you not grasp reality, man? Government Spending Triggers Fiscal Undertows.
Only somebody with the mentality of an insect would lack the wisdom to see that, beyond a certain early point (long ago passed in our case) the governmental cast on the economic limb with the fracture* causes atrophy of the market muscles. Human beings that do not confuse themselves with Socialist ants can grasp that an exoskeleton on the limb implies increasing weakness over time, not recovery. Load-shed the government spending, the over-regulation, the suffocating growth of bureaucracy, and go for some good, old-fashioned physical therapy.
Sincerely, Thanks For Understanding.
–Smitty

*Caused by a load of regulation that landed upon it.

Update: Surberlanche!

Update II: Linked at WyBlog, too. Thanks!

Update III: Left Handed Nib and That Mr. G Guy pick it up.

Update IV: Tagged by marfdrat.

Category: New York Times

Comments

28 Responses to “Krugman, STFU!”

  1. 2012 presidential scoreboard update « Don Surber
    August 1st, 2011 @ 8:57 am

    […] And Robert Stacy McCain serves crow to Paul Krugman. […]

  2. Serr8d
    August 1st, 2011 @ 1:23 pm

    Crocodile tears, mostly.

    http://twitter.com/#%21/search/%23croctears

  3. Anonymous
    August 1st, 2011 @ 1:41 pm

    You’d think Paul would know this, but the worst thing you can do is raise taxes. See: 1937.

  4. Anonymous
    August 1st, 2011 @ 1:43 pm

    How was Keynesianism supposed to work this time, Krugman? Like some kind of epic game of existential chicken? Krugam claims that all the spending under Obama – TARP II, stimulus, QE1, QE2, Obamacare, etc. – was, what, only half of what was necessary to induce demand and jump start economic growth. Yet, having spent only half what Krugman wanted, we’re possibly headed toward a credit downgrade.

    So, basically, Krugman/Keynesians were arguing for the BACK TO THE FUTURE plan: from the starting line, slam on the gas in the DeLorean, try to get it up to 90 m.p.h. as fast as possible, hope that the flux capacitor sends us back to the future (or, in Krugman’s dream, back to the 195os) before the DeLorean hits the brick wall.

    In reality, Krugman’s plan wouldn’t have taken us back to the future, it would have made our national finances look even more like John DeLorean’s 1982 bank book.

    Never mind that the feds have been spending like drunken sailors for over a decade now (including under GWB). Apparently, Keynesianism is just like socialism in that regard: if the experiment fails it’s because it wasn’t done on a large enough scale!

  5. ThePaganTemple
    August 1st, 2011 @ 2:11 pm

    Krugman must think the government can and should print whatever money is necessary in order pay for however large amount of stimulus he thinks we need. He probably bases this on the ill-conceived belief that a large enough investment would pay long-term dividends with a minimum of short term gains.

    I owe Krugman a debt of gratitude. He more than any other person in the world, past or present, has taught me a very important lesson, one I will carry to the grave-economists are full of fucking shit. I put them on the same level as people who try to solve murders and missing persons cases by divining the entrails of chickens.

    I have incalculably more faith in my damn Tarot cards than I do a jackass like Krugman.

  6. Scott A. Robinson
    August 1st, 2011 @ 2:24 pm

    You know what Keynes said after all….”In the long run we’re all dead anyway!”

  7. Soviet of Washington
    August 1st, 2011 @ 2:25 pm

    Actually, Krugman is right…by his lights. 

    Since GDP = Consumption+Investment+Govt Spending+(Exports-Imports), a reduction in GS will result in a reduced economy.  His problem is that he doesn’t want to admit that the Keynesian solution (a large government deficit) will eventually crash the system even more thoroughly.  As Von Mises said (“”There is no means of avoiding the final
    collapse of a boom brought about by credit expansion. The alternative is
    only whether the crisis should come sooner as a result of a voluntary
    abandonment of further credit expansion, or later as a final total
    catastrophe of the currency involved.”), better to take your medicine now and swear off the ‘drink’ while you have time.  Would have been even better to have done so in 2008, or 2001.

  8. Anonymous
    August 1st, 2011 @ 2:28 pm

    Good stuff, linked @ RR…

    The Debt Deal, Simplified:

    PS- congrats Mr and Mrs Smith on your blessed addition~

  9. rosalie
    August 1st, 2011 @ 2:29 pm

    Even “drunken sailors” stop spending when they run out of money.

  10. Lance Burri
    August 1st, 2011 @ 2:29 pm

    Hey, man!  He’s a Nobel Prize winner!  Show some respect!

  11. Joe
    August 1st, 2011 @ 2:39 pm

    Agreed.  Obama loves this deal.  It is about him getting re-elected.  A means to an end.  If that happens, there is no deal.  We are fucked. 

  12. Joe
    August 1st, 2011 @ 2:48 pm

    Hey Stacy, the Dow is down about 200 this morning.  Your prediction was just a wee bit premature. 

    So the deal passes and the markets tank?  What gives?

  13. mojo
    August 1st, 2011 @ 3:01 pm

    “Human beings that do not confuse themselves with Socialist ants…”

    As a famous Myrmicologist once said of Socialism: “Wonderful idea. Wrong species.”

  14. WyBlog - Welcome to the grand illusion (of spending cuts)
    August 1st, 2011 @ 11:20 am

    Welcome to the grand illusion (of spending cuts)…

    Well, Herr Doktor Professor Krugman is unhappy so maybe this latest debt ceiling grand compromise isn’t such a bad deal after all….

  15. Paul Krugman Very Unhappy With Debt Deal…Good! « That Mr. G Guy's Blog
    August 1st, 2011 @ 1:04 pm

    […] Smitty over at TOM has some advise for Mr. Krugman; Sitting There Feeling Useless sits Paul Krugman, unable to grasp […]

  16. Debt Deal: Huge Win for Republicans | Left-Handed Nib
    August 1st, 2011 @ 1:06 pm

    […] has good reason to crow, and it does. Smitty at The Other McCain tells Paul Krugman he has “the mentality of an insect” to believe that removing billions of dollars from an already anemic economy will inhibit […]

  17. Mike
    August 1st, 2011 @ 5:08 pm

    Linked and quoted at http://wp.me/pTkxi-PB

    Anytime Krugman is unhappy, I’m ecstatic. 😉

  18. McGehee
    August 1st, 2011 @ 5:53 pm

    When I started reading your comment, my mind played a trick on me and here’s how the first sentence of your second paragraph looked:

    Since GDP = Corruption+Investment+Govt Spending+(Exports-Imports)

    I’ve been reading too much politics lately…

  19. DaveO
    August 1st, 2011 @ 5:57 pm

    Krugman didn’t get the Nobel for his work in economics, but for his heated opposition to everything-Bush. Now that Bush is gone, his knowledge of economics is… poor.

    That means the Nobel committee doesn’t know much about money either, but the power of the credential (the Nobel Prize) trumps knowledge.

    Easy test for Krugman: if given a $100 bill, would he smoke it, or go to Starbucks for a venti mocha?

  20. Tim Burns
    August 1st, 2011 @ 6:10 pm

    Uh, never mind that QE1 and 2 are not government spending, that TARP is Bush’s baby (which the President supported), and that Obamacare hasn’t cost a nickel yet, your comment and the comments of your compatriots are still off.  The US was not in risk due to the deficit or the debt.  Our bonds sell (well, sold, thanks to house Republicans) very well and at low rates.

    I mean, now sure the morons in the House and their grandstanding and refusal to pay for spending they already authorized on 4/15/11 (when they passed the budget) are going to result in a downgrade in our credit rating, which will drive the cost of borrowing up and make the damn deficit bigger.  Thanks, morons.

    Meanwhile, for PGlenn, well-meaning conservative:  here is a handy chart from the CBO which shows you where the “debt” comes from
    http://www.nytimes.com/imagepages/2011/07/24/opinion/sunday/24editorial_graph1.html?ref=sunday

    Barring an Obama surrender at the end of next year, at least the Bush tax cuts will go away and revenue will increase by 4 trillion over the next 10 years.  Maybe then, Republicans can stop whining about deficits they cause and then refuse to pay for…..as a matter of demagogic fact, they made the mess and then blamed the next guy for it.  Since he was a Democrat, y’all were fine with it.

    One more step back to Stacy’s Eden-esque neo-feudalism, where we can all beg for crumbs at the plantations and factories of the super-rich!  Yay

  21. AngelaTC
    August 1st, 2011 @ 6:49 pm

    4 trillion in revenue is an overly generous estimate, and that’s all I’ll say about that.  No matter what tax plan we’ve embraced in the past, revenue always stays at about 18% of GDP.

    Not to mention that 4 trillion over the next 10 years won’t make a dent in the deficit if the spending continues even at its current pace.   The problem isn’t revenue, it is spending. 

    The Republicans admit that, and as you may recall, voted their politicians out of office in large numbers in 2006, before the economy crashed. The Democrats grabbed the purse strings, and yanked them even tighter around our collective necks.

    Both parties are to blame, but if your solution is to blame the GOP, well….who am I to tell you its a bad one? IN fact, I strongly suggest you stick with that meme. It’s much easier than holding your own party accountable, and you can take that from someone who has scars from doing exactly that.

  22. AngelaTC
    August 1st, 2011 @ 6:55 pm

    “Would have been even better to have done so in 2008, or 2001.”  Or 2011. 

  23. Anonymous
    August 1st, 2011 @ 7:31 pm

    Bitterly partisan much? I criticize Krugman/Keynesianism, and note that sizable deficits began under GWB, and you scream, “evil Rethuglicans!” (btw, the NYT chart you sent shows huge increases in the deficit during the Obama administration).
     
    TARP II was introduced in Feb. 2009. TARP is a Bushobama policy. 
     
    QE might not be government spending – more like “printing” electronic cash – but modern Keynesians promote aggressive fiscal AND monetary policies during a recession.
     
    My point was that we did 70 percent of what Krugman called for, the recession stubbornly persisted, and now most elites agree that we cannot keep running such high deficits. What if we had done Krugman’s stimulus x2? Yet because we didn’t do stimulus x2, Krugman makes excuses, as if half-stimulus is no better than zero-stimulus. What kind of theory is that?
     
    Besides, we won’t really know the true “costs” (or implications) of QE for several years.
     
    But, of course, if we had only “taxed the rich” none of these problems would have happened, right? Or, maybe it was caused by the Bushobama wars?
     
    In reality, if we let the Bushobama tax cuts expire, we’ll get a modest, temporary increase in revenues, the “benefits” of which will dimish over time as the negative effects of higher taxes offset the modest revenue gains. Do you really believe that higer taxes could have accomodated the recent mushrooming size of government “investments” (gov’t spending as a percentage of GDP)?

    What if we project into the future under Obamacare? 

  24. Adjoran
    August 1st, 2011 @ 7:47 pm

    The recent market activity has never been about the debt deal, despite the talking heads’ belief it was all anyone ever thought about.  It’s been about the numbers – it goes up when it gets some good earnings or economic numbers, and down when it gets bad ones.

    The recent data on manufacturing and factory output has been very bad.  And with the housing market still flooded with inventory, and many tens of thousands of foreclosures on hold while the whole assignee problem is sorted out (giving that many more in the market pipeline), housing construction isn’t going to be leading any recoveries anytime soon.

    That leaves exports, but we are already at almost Zero for a discount rate and the dollar has already been seriously weakened.  However, with nothing else to do, bet on Bernanke attempting “QE3” with results similar to the first two (barely detectable).

    Krugman, of course, advocates policies which have never worked as he claims they will if only we fund them with quadrillions instead of mere trillions.

  25. Adjoran
    August 1st, 2011 @ 7:51 pm

    Krugman’s actual work in economics was extremely specialized – measuring the effect of the business cycle on international trade and vice versa. 

    Expecting him to understand broader economics in practice would be like expecting a particle physics expert to know anything about climate.

  26. Malclave
    August 1st, 2011 @ 7:56 pm

    Spend
    Tax
    Federalize
    Unionize

    STFU, America!
    (Obama’s reelection platform)

  27. I Would Normally Wail on Krugman for His Latest NYT Whinefest... | marfdrat
    August 1st, 2011 @ 3:58 pm

    […] 1, 2011 var addthis_product = 'wpp-261'; var addthis_config = {"data_track_clickback":true};But Smitty over at The Other McCain has already done it for me. Sitting There Feeling Useless sits Paul Krugman, unable to grasp […]

  28. Anonymous
    August 1st, 2011 @ 8:02 pm

    Also, when I was talking about “all the spending under Obama” and included QE and Obamacare, I didn’t mean strictly within the confines of 2009 – 2011.

    TARP started under Bush, but much of the money was left over for the Obama administration to implement Keynesian spending along with its own “stimulus” package. When the Congress (Democrat-controlled between 2006 – 2010) and Obama raised spening levels across the board (on top of Bush’s prescription drug plan and two wars), that created the new baselines, which are now used against alleged “cuts” going forward.

    Likewise, the Democrats/progressives sold Obamacare partly on the basis that businesses would be relieved to offload medical costs, etc., and that Obamacare would stabilize future medical costs, give companies more financial confidence, predictability. Obamacare was also supposed to reduce projected deficits in 2014, 2015, etc. However, revised projections show that Obamacare will be more expensive than advertised and won’t control rising medical costs. 

    In other words, between 2008 (Bush introduced TARP) and now, we’ve had massive gov’t spending, plus promises of heavy government “investments” going forward, yet we’ve had woeful economic growth – not exactly a ringing endorsement for Keynesian economics and/or the future value of signaling progressive “commitments,” yet Krugman makes excuses.

    If you can get past your kneejerk reaction to opposing thoughts, y’ now what I’m sayin,’ right?