Paul Krugman and aliens

Why can't Krugman just call for massive infrastructure spending and leave aliens out of it? Is he really as crazy as he sounds?

http://newsbusters.org/blogs/noel-sheppard/2011/08/14/paul-krugman-calls-space-aliens-attack-earth-requiring-massive-defens

Originally posted by Metal Brain
Why can't Krugman just call for massive infrastructure spending and leave aliens out of it? Is he really as crazy as he sounds?

http://newsbusters.org/blogs/noel-sheppard/2011/08/14/paul-krugman-calls-space-aliens-attack-earth-requiring-massive-defens

We just need to believe in pretend aliens for 18 months. Where is Orson Wells when we need him?

Instead, maybe we could just say that the Chinese are attacking. It's a lot more believable.

Originally posted by spruce112358
We just need to believe in pretend aliens for 18 months. Where is Orson Wells when we need him?

Instead, maybe we could just say that the Chinese are attacking. It's a lot more believable.

None of that war nonsense even needs to be discussed. He is an idiot for even digressing into that since war is not needed to stimulate industrial production.

This just goes to show that economists can be extremely stupid even if they seem smart at first.

Originally posted by Metal Brain
None of that war nonsense even needs to be discussed. He is an idiot for even digressing into that since war is not needed to stimulate industrial production.

This just goes to show that economists can be extremely stupid even if they seem smart at first.

Paul Krugman can definitely be accused of selectively ignoring or mischaracterizing economics to make a political point. He can be accused of presenting data and its interpretation in a misleading manner to exaggerate the strength of his argument. He can most certainly be accused of being annoyingly full of himself. What he cannot be reasonably accused of is stupidity. The man is brilliant without a doubt.

Read the link. That author is a nitwit. He's so hot and bothered to bash "liberals" that he completely ignores points Rogoff (a chess grandmaster, BTW), Krugman, and Zakaria are making.

Actually, it isn't even clear that Zakaria was making a point. He's the host of the show. It makes sense for him to pose questions to generate discussion. He's asking Rogoff to clarify his point in light of a simple economic misconception that is still in a lot of people's minds (paying people to dig holes and fill them is good for the economy).

Krugman was making a point about expanding government spending to build up aggregate demand and increase inflation as a short-term policy against the recession. He picked military spending as an example and then motivated it with a fun hypothetical (Orson Wells style).

There's good reason to be worried about Paul's ideas. First, he's not willing to say just how much spending should be done and how expansive Fed policy should be. As long as the economy remains depressed, he'll say it's not enough spending. When the economy recovers, he'll say that it would have recovered faster if spending had been more. The danger with his idea is that it's not clear that it will work. If it does, then great. Growth will help us pay down the deficit faster. If it doesn't do the trick, then you've just made the situation very, very bad. Given this considerable uncertainty and Paul's unwillingness to get specific about policy, I'd hesitate to take the gamble.

But what this author does is just misrepresent (oversimplify) people's statements and then shoot down strawmen with a healthy helping of insults thrown in. Low level work in my opinion.

Originally posted by Metal Brain
None of that war nonsense even needs to be discussed. He is an idiot for even digressing into that since war is not needed to stimulate industrial production.

This just goes to show that economists can be extremely stupid even if they seem smart at first.

It's a freaking example! You really struggle with identifying those, don't you?

Originally posted by telerion
Paul Krugman can definitely be accused of selectively ignoring or mischaracterizing economics to make a political point. He can be accused of presenting data and its interpretation in a misleading manner to exaggerate the strength of his argument. He can most certainly be accused of being annoyingly full of himself. What he cannot be reasonably accused of is stupidity. The man is brilliant without a doubt.

The man does not seem to realize industrial production stimulates the economy and that war is just one way of doing that. If he is so brilliant why even bring up something that would waste spending and cause destruction? Which is better, building a bridge or destroying it?

At the very least he had a blond moment. Wouldn't you agree?

Originally posted by telerion
Read the link. That author is a nitwit. He's so hot and bothered to bash "liberals" that he completely ignores points Rogoff (a chess grandmaster, BTW), Krugman, and Zakaria are making.

Actually, it isn't even clear that Zakaria was making a point. He's the host of the show. It makes sense for him to pose questions to generate discussion. He's ask ...[text shortened]... n with a healthy helping of insults thrown in. Low level work in my opinion.

How could expanding needed investment in government infrastructure at a time with massive amounts of un and underemployment not "work"?

Originally posted by Metal Brain
The man does not seem to realize industrial production stimulates the economy and that war is just one way of doing that. If he is so brilliant why even bring up something that would waste spending and cause destruction? Which is better, building a bridge or destroying it?

At the very least he had a blond moment. Wouldn't you agree?

Did I miss the spot where Paul Krugman says that the only way to increase production is with military spending?

Originally posted by telerion
Did I miss the spot where Paul Krugman says that the only way to increase production is with military spending?

Did I miss the spot where he said there was another way?
A careless omission, wouldn't you say?

Originally posted by Metal Brain
Did I miss the spot where he said there was another way?
A careless omission, wouldn't you say?

Jebus, you sound like one of the strict interpretation of the US constitution crackpipers...you're argument breaks down to this, whether you see it or not is one for the gods.

In 1787, there was a sizable block of delegates who were initially opposed to the Bill of Rights. This is what a member of the Georgia delegation had to say by way of opposition; 'If we list a set of rights, some fools in the future are going to claim that people are entitled only to those rights enumerated and no others."

Originally posted by Metal Brain
Did I miss the spot where he said there was another way?
A careless omission, wouldn't you say?

He's been saying it for years. He said it a couple of weeks ago AGAIN:


So this is a really good time to borrow for infrastructure spending, which we badly need and which would create jobs at a time when we badly need jobs.”

http://dailycaller.com/2011/08/01/krugman-we-are-repeating-the-mistakes-of-the-1930s-value-added-tax-plausible-solution/

Originally posted by no1marauder
How could expanding needed investment in government infrastructure at a time with massive amounts of un and underemployment not "work"?

In two ways:

1) You might not spend enough to do much of anything. This is what Paul has been repeating and repeating. I would like to know just how much he thinks should be spent. "Enough," is not an acceptable answer.

2) You spend too much. A lot of labor is hired for the projects so new workers spend time building roads/bridges/whatever (whether they are any good at it or not) rather than looking for new jobs in the private sector that are a better fit for their skills. Now clearly, there aren't many new jobs in the private sector to be had at the moment, so the loss isn't so bad immediately.

The massive public works program takes say six months to a year to get going. The most important and productive improvements are identified and begun. Other people are put to work on less important projects. After two years, many projects are still left to be completed and workers are syphoning off to better jobs in the private sector. Lots of incomplete projects exist, many of which weren't really that productive but were still begun in the name of employing slack workforce.

The total cost of such a policy to the public would be enormous (otherwise, according to PK, it wouldn't be effective). The key question is whether the policy moves forward the time that we exit this slow growth period by a sufficient amount and whether this improvement in addition to the marginal increase in growth from the new infrastrucure over the future more than offsets the cost of the project (including interest on the new debt). I don't think any good economist (PK included) can look you in the eye and tell you with surety, based on our best economics, that this will be the case.

I think it's just a very big gamble.

Originally posted by telerion
In two ways:

1) You might not spend enough to do much of anything. This is what Paul has been repeating and repeating. I would like to know just how much he thinks should be spent. "Enough," is not an acceptable answer.

2) You spend too much. A lot of labor is hired for the projects so new workers spend time building roads/bridges/whatever (whethe our best economics, that this will be the case.

I think it's just a very big gamble.

A related question is whether there is infrastructure whose economic benefit would justify the costs (even if enormous), but that will likely not be built at all absent government funding (the public goods issue again). I have a difficult time believing that there are none, given the age and general repair of much of our infrastructure (and for some of which, the costs of continual “patch and repair” may justify the costs of a complete rebuild.

Even if the delay in implementing such projects is problematic from the point of view of short-term stimulus, projects that it makes sense to build—well, it makes sense to build them. I would think that betting on a sufficient improvement in the economy and employment to worry about “siphoning” jobs to better-compensated ones in the private sector would also be taking a big gamble. None of which is to say that there aren’t better short-run stimulus projects. But I think it would be a huge gamble to assume that such projects are going to get any more traction at this point, politically. By the time infrastructure contracts begin having a significant impact, the short-term (6 months to a year?) may well have become the medium term (or the medium-term is now the new short-term?).

In sum, I would suggest that the positive fiscal impact of publically-funded infrastructure building adds to the incentive to get the ball rolling for otherwise justifiable projects sooner rather than later.

[The debate over high-speed rail seems to be mostly centered on the microeconomics: which, if any, of the proposals enhance transportation efficiency. You corrected me on the principle of excludability last time we talked about this (both generally, and with regard to HSR in particular), but I’m not sure that are not what might be called “quasi-public goods” that would fit the above description even if they are generally excludable. Think of that as a question….]

Originally posted by vistesd
A related question is whether there is infrastructure whose economic benefit would justify the costs (even if enormous), but that will likely not be built at all absent government funding (the public goods issue again). I have a difficult time believing that there are none, given the age and general repair of much of our infrastructure (and for some ...[text shortened]... fit the above description even if they are generally excludable. Think of that as a question….]

This is right, and maybe there is an infrastructure project like you describe in the first paragraph; but I'd want to identify it before appealing to it to justify so much spending . . . err I mean borrowing. 🙂

I'm really not totally against PK's call for a large spending program (I believe some time ago I wrote that my response over the last 6 months to the continued lag in growth is to be more open to unconventional ideas), but I want to see some specifics before I give him credit.