David Frum on the Personal Irresponsibility of Ron Paul
Twitterstorm delong: January 3, 2011

Show, Don't Tell!: Paul Krugman Unsuccessful Smackdown Watch Blogging

I remember Jeff Weintraub and Shannon Stimson, back before my eyes were opened, beating it into my head that it was important not to just tell--not to just make claims--but to show, and then tell your readers what you have just shown them.

Tyler Cowen sees Paul Krugman responding to an Alex Tabarrok post entitled "Krugman vs. Krugman", and writes:

Krugman’s response to Alex:  The issue is not that Krugman changed his mind…. The issue is that Krugman a) regularly demonizes his opponents, including those who hold Krugman’s old positions…

If that were the issue, wouldn't Tabarrok's post have been titled: "Krugman Unfairly Demonizes His Opponents"? Seems to me we have an "Oceania has always been at war with Eastasia" moment here…


Let's roll the videotape:

Alex Tabarrok:

Krugman v. Krugman:

Paul Krugman (Jan 1, 2012):

People who get their economic analysis from the likes of the Heritage Foundation have been waiting ever since President Obama took office for budget deficits to send interest rates soaring. Any day now!

…while debt can be a problem, the way our politicians and pundits think about debt is all wrong, and exaggerates the problem’s size.

…nations with stable, responsible governments — that is, governments that are willing to impose modestly higher taxes when the situation warrants it — have historically been able to live with much higher levels of debt than today’s conventional wisdom would lead you to believe.

Paul Krugman (March 11, 2003):

…last week I switched to a fixed-rate mortgage. It means higher monthly payments, but I’m terrified about what will happen to interest rates once financial markets wake up to the implications of skyrocketing budget deficits.

…we’re looking at a fiscal crisis that will drive interest rates sky-high….But what’s really scary — what makes a fixed-rate mortgage seem like such a good idea — is the looming threat to the federal government’s solvency.

…How will the train wreck play itself out? ….my prediction is that politicians will eventually be tempted to resolve the crisis the way irresponsible governments usually do: by printing money, both to pay current bills and to inflate away debt. And as that temptation becomes obvious, interest rates will soar.

Now to be fair, Krugman covered himself in 2003 in a credible way he said “unless we slide into Japanese-style deflation, there are much higher interest rates in our future.”

If Tabarrok's complaint is that Krugman unfairly demonizes his opponents, let's see the examples of this unfair demonization that are so upsetting, please, so we can judge them.

In fact, let's look at http://krugman.blogs.nytimes.com right now for unfair demonization: Mitt Romney… Jean-Claude Trichet… Alex Tabarrok… Let's look at that one:

Alex Tabarrok thinks he has a great gotcha in my warnings about deficits and interest rates from 2003. Except, I’ve already acknowledged that mistake:

The second [big mistake] was circa 2003, over the Bush administration’s use of the illusion of victory in Iraq to push through more tax cuts, even though the optimistic budget projections used to justify the first round had proved completely wrong. It’s worth pointing out that the situation was not at all like the present, where I support temporary deficit spending to deal with a depressed economy; the Bushies were pushing permanent tax cuts that had nothing to do with economic stimulus, and did so at a time of war with no offsetting spending cuts (and then pushed through an unfunded expansion of Medicare too). This struck me at the time as banana-republic behavior, and still does.

However, I wrongly believed that markets would look at it the same way, and that they would lose faith in American governance, driving up interest rates on our debt. Instead, bond investors discounted the politics, and acted as if they believed that America would eventually pull itself together and start behaving responsibly. The jury’s still out on that, but clearly my short-run prediction proved wrong.

Now, the problem with Heritage this time is that they didn’t make the prediction of rising rates conditional on loss of confidence in US solvency (whether that makes sense is another issue); they presented it as a pure crowding out argument. Here’s Brian Riedl:

The government is going to have to raise interest rates in order to convince people to lend them the full amount they need. We’re already facing a deficit of $1.2 trillion this year, and 700 billion next year. We borrowed $700 billion for TARP, and now we’re going to borrow $800 billion for this stimulus package. Compare those numbers to the entire public debt, which was 5.8 trillion up until a few months ago. It’s going to be very difficult for a global economy, which is already in a recession, to supply the U.S. government with [$3 trillion] in new borrowing. Right now, a lot of banks are happy to buy Treasury bonds because they are safe investments… but overall, that may not be enough. The government may have to raise interest rates higher and higher and higher in order to persuade people to lend their diminishing savings to the government. And that’s going to hurt the economy for a long time.

That was just wrong; it represented a completely wrong model of how the economy works. So where’s the rethink?

Doesn't seem to me that that is unfair demonization of either Alex Tabarrok or Brian Riedl.

If Alex Tabarrok is going to title a post "Krugman vs. Krugman", it is not unfairly portraying him as a mendacious idiot to observe that the two quotes he opposes need to be opposed--need to contradict each other.

If Brian Riedl predicts that interest rates will rise very rapidly as a result of TARP and the ARRA--and if they do not--it is not unfairly portraying him as mendacious idiot to observe that he owes us a public rethinking of what is wrong with his model of the economy.

I would note that Krugman talks about what he thinks is wrong with the argument of Brian Riedl:

the problem with Heritage this time is that they didn’t make the prediction of rising rates conditional on loss of confidence in US solvency…

and what he thinks is wrong about the argument of Alex Tabarrok:

Alex Tabarrok thinks he has a great gotcha…. Except, I’ve already acknowledged that mistake…

Tabarrok talks about other things than what is wrong with Krugman's arguments:

[O]ne thing remains constant in all of Krugman’s writings, anyone who disagrees with him is portrayed as a mendacious idiot…

And so does Cowen:

The issue is that Krugman a) regularly demonizes his opponents…

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