Free Markets, Free People

Krugman and Pelosi – two peas in an economic pod

Remember a few days ago I pointed out how Nancy Pelosi was out and about claiming that unemployment benefits was the greatest job creator in the world?

Well guess where she probably got it from – Paul Krugman?

Wait: there’s more. One main reason there aren’t enough jobs right now is weak consumer demand. Helping the unemployed, by putting money in the pockets of people who badly need it, helps support consumer spending. That’s why the Congressional Budget Office rates aid to the unemployed as a highly cost-effective form of economic stimulus. And unlike, say, large infrastructure projects, aid to the unemployed creates jobs quickly — while allowing that aid to lapse, which is what is happening right now, is a recipe for even weaker job growth, not in the distant future but over the next few months.

I won’t bother you with the reasoning that says this is absolute nonsense – that was covered in the Pelosi post.  What’s surprising is how desperate Krugman is to have his way with increased deficit spending – to stoop to this level of argument.  Suffice it to say, this doesn’t increase “consumer demand” or support “consumer spending”.  Unemployment benefits are a fraction of what the household was making before so what it goes toward is the maintenance of necessities and not much else.

To see a Nobel prize winning economist reduced to this  – a political hack – is rather revealing.  It certainly, at least in my mind, makes everything he writes that is purportedly about his specialty suspect.  If this is his argument, then he hasn’t got an argument, and if you read the rest of his screed you’ll discover it is only an excuse to attack the GOP – falsely, of course.

Krugman has all but ruined his reputation as an economist with nonsense like this. Of course when a person becomes identified with the clueless, like Nancy Pelosi, and their arguments, the decent into full “hackery” is complete.



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18 Responses to Krugman and Pelosi – two peas in an economic pod

  • I thought Jacobson gave this a pretty good treatment today, too.  He did seem to sort of accept the stimulative effects of unemployment, though.
    Nobel Prizes are junk, sometimes.  Even in fields like economics.
    I gave up fisking Krugmen some time ago.  Just shooting fish in a barrel.  I may do it in future, but nobody is paying attention anymore to Krugmen anyhow.
    He beclowns himself with most of what he writes/says anymore.

  • I suppose that the logic is something like this:

    Bob lost his job.  He used to have $100 to spend.  Thanks to unemployment, he has $50 to spend.  Hey, at least he’s got $50 to spend and that’s better than $0, so let the good times roll, baby!

    O’ course, Bob only has that $50 because his former coworkers Joe and Tom and Jane and Pasquale are kicking in $14 each (Uncle Sugar has to get paid too, you know), reducing their spending power by that much.  This is called spreading the pain wealth around.  It’s also called, “Bob will learn in a hurry who he needs to vote for in November if he wants to keep that gravy train going.  Since he isn’t working, maybe he’d also like to volunteer for OfA.  And did I mention that Tom is a dirty racist teabagger for complaining about that $14 he gets to kiss goodbye donate to a good cause instead of spending on his own greedy, selfish desires?”

    I seem to recall an incident during the last campaign in which The Dear Candidate was asked by a very irate unemployed engineer why unemployment insurance only paid a fraction of his former pay instead of matching it dollar for dollar.  Well, why not?  If paying unemployed people 60% of their former pay stimulates the economy and saves or creates jobs like nothing else, then paying them 100% should REALLY get things moving, eh?  Hell, why not give people 200% of their pay and demonstrate the truly awesome power of SERIOUS Keynesian economics?

    Even Krugman and SanFran Nan should be about to figure that one out.  Unfortunately, nobody from MiniTru will ever ask.  Nor will any of them ever stop to think that, if giving money to the unemployed stimulates the economy, then letting working people keep rather more of their pay due to lowered tax rates might just do the same thing.

    But, then again, I don’t have a Nobel, so what do I know?

  • This kind of thing reminds me of the quacks who claim to make Perpetual Motion Machines. Sooner or later(usuallu sooner) the Laws of Thermodynamics look an awful lot like Non-Keynesian Economics.

  • Krugman was reduced to a political hack a long time ago. That’s how you get, or at least keep, a column at the New York Times. (Safire was something of an exception, but still not a favorite of mine.) That op-ed page is, to paraphrase Ronald Reagan, the central focus of the doucheoisie in the world. And it’s not unlikely that Krugman got the Nobel prize as much for the political hackery as his supposed contribution to economics (about which I confess I’ve forgotten what it was).

  • {eyes rolling} {chuckle} {giggle} Look, Krugman has a Nobel Prize, and you guys are just ex-military basket cases wigged out from the stress of serving in the military.

    So let me, with my own advanced degrees, inform you on this, since you guys clearly don’t understand post-modern economics. Let me, with my rich store of wisdom and godlike powers of political science explain it to you again, the same way I explained Keynesian economics to you last week when you were so deluded about it.

    Those unemployment benefits are good and wise and effective bacause in post-modern economics, intentions trump everything, and multiple truths are created to support those intentions. Everyone benefits because it leads us closer to the salvation of leftist utopia.

    In this case, the primary multiple truth that we wise, compassionate leftists have agreed on is that government spending creates jobs. We have decreed it, and I don’t know why you guys keep arguing about it. That’s against the holy writ of post-modernism, not to mention being mean because it deprives people who desperately need money to buy new cell phones and video games.

    So stop with all your “evidence” and “charts” and “graphs” and instead focus on the simple truth. We won. We’re going to make society into a leftist utopia, and then everything will be great, unless you grunt engineer types sabotage it. See, collectivism works as long as it’s implemented by the right people (wise leftists with advanced degrees in political science, for example), and as long as it’s not sabotaged by sterile, inbred, mindless, Nazi-like thugs on the right.

    If Obama’s grand efforts fail, it’s not really his fault. We wise leftists are never at fault, as I’ve told you all before, because our intentions are so good. Nope, if they fail, it’s YOUR fault. Everyone one of you should lie awake at night thinking “Look at what I’ve done to poor people. I’m Nazi-like. Woe is me. I should immediately sign up for that online course offered by that polysci professor at the moose college up in Maine. He would set me right, and I would be so much happier.”

    Besides, I suspect you guys are going to be surprised. I suspect Obama is going to cut spending, as I’ve been saying for eighteen months now. I suspect the oil spill will be taken care of by grunt engineers and Obama will get the credit for forcing them to get the job done (as he should, being a visionary leader and all). I suspect that the economy is going to start roaring right back under the power of the stimulus and Obama’s christlike visage. I suspect the Democrats are going to do well in the fall. I suspect that everyone else will start seeing the giant magenta caterpillars with Sarah Palin’s face that are constantly coming out of the walls of my office.

    • Krugman has a Nobel Prize

      … so does Al “sex poodle” Gore and Barack “The Won” Obama
      Only a-holes get these things … makes me glad I don’t have one.

    • You are very suspicious, Ott…suspecting here and suspecting there…

  • “To see a Nobel prize winning economist reduced to this  – a political hack – is rather revealing. ”
    You have it backwards McQ.  A political hack was elevated to prominence by winning the Nobel prize.  His economic theories are becoming more and more ludicrous the older he gets.  He is a disgrace to the profession.

  • To see a Nobel prize winning economist reduced to this  – a political hack – is rather revealing

    >>>> Um…..where you been?  He reached hack status about 7 years ago

  • Pelosi and Krugman…pod people.  Yes, it is all clear now…