DeLong Smackdown Watch: Paul Krugman Outs Me
Sigh. I had carefully, carefully trimmed that quotation. Now Paul Krugman has to go look at the original:
A Quotation Ruined By Context: Via Brad DeLong, I learned of this great line by J.S. Mill:
What was affirmed by Cicero of all things with which philosophy is conversant, may be asserted without scruple of the subject of currency – that there is no opinion so absurd as not to have been maintained by some person of reputation. There even appears to be on this subject a peculiar tenacity of error – a perpetual principle of resuscitation in slain absurdity.
Right on! But wait — what is the absurdity of which Mill was speaking?
There are writers of pretension, not only out of Bedlam, but even, we can assure Sir Robert Peel, out of Birmingham, who think it the duty of the legislature periodically to degrade the standard (or to authorize an increase of inconvertible paper exactly equivalent) in proportion as the progress of industry creates an increase of productions and a multiplication of pecuniary transactions.
Translation: there are crazy people who think that the money supply should grow over time, in line with the long-run growth of real GDP. By that standard, Milton Friedman was crazy.
