May 19, 2013
Krugman: Hardly 'Hard-line'
For years now, New York Times columnist Paul Krugman has been writing the same column over and over again with this simple message: austerity bad, spending good. He continues in this vein with "The Chutzpah Caucus." With "Krugman's Still Wrong" at National Review, Michael Tanner of the Cato Institute provides a vigorous counterpoint to Krugman's austerity argument, and in a post at Krugman-in-Wonderland, economics professor William L. Andersen writes: "I'm not sure what Krugman means by claiming that the world is in 'austerity' when national governments across the globe have accelerated spending and especially borrowing." But what I'd like to address is a few of Krugman's "facts"; what he's forever calling "the data": Keynesian economics says not just that you should run deficits in bad times, but that you should pay down debt in good times. And it's silly to imagine that this will happen, right? Wrong. The key measure you want to look at is the ratio of debt to G.D.P., which...(Read Full Article)