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Just a quick note on this post from Krugman which includes

So am I saying that you can have full employment based on purchases of yachts, luxury cars, and the services of personal trainers and celebrity chefs? Well, yes. You don’t have to like it, but economics is not a morality play, and I’ve yet to see a macroeconomic argument about why it isn’t possible.
Not only is economics a morality play; it is the morality play. Yes you can have a British class system Downtown Abbey style economy in America; we already do to some extent. No you cannot reach full employment with such a system in modern times.

The problem would be one of structural unemployment. Most Americans simply lack the centuries of kiss ass skills bred into class system workers. The most important of these skills is a passion for working very hard for very little.

That's the macroeconomic problem with Krugman's dystopia. The microeconomic problem is much worse

Full employment in microeconomics is when the economy is employing all of its available resources. This simply means that the capital goods and capital resources are at their highest and most efficient within the economy.
It is difficult to be efficient with trickle down economics. If you spend most of your employment on products and services that only a small minority consumes, hard to also provide for the general welfare.

6:10 AM PT: Look people I am very happy that we have a slightly liberal voice at the New York Times. It doesn't make his ideas about economics any more correct. I am refuting the possibility of the economy he claims could exist. The evidence is completely on the side of that economy being a unicorn since we have been trying and failing at trickle down for three decades in America.

Other notes - we lack the culture here for Downton Abbey but we can do Downtown Abbey. There is no Nobel prize in economics. The prize given using Nobel's name comes from a bank. And before you continue this hero worship nonsense on an argument of ideas please remember that Stiglitz, whom Krugman is disagreeing with, is the real hero, not Krugman.

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Comment Preferences

  •  Personally I think I'd I'd rather have... (2+ / 0-)
    Recommended by:
    radarlady, Roger Fox

    ...a "kiss-ass" skill and be alive as opposed to having no skill in demand and freezing to death in a tent under a bridge.

    Boehner Just Wants Wife To Listen, Not Come Up With Alternative Debt-Reduction Ideas

    by dov12348 on Wed Jan 23, 2013 at 11:20:23 PM PST

  •  You don't read much Krugman do you? (10+ / 0-)

    He is one of the furthest to the left economists out there, and one of the few people who openly talks about labor rights and issues in a broader economic context.

    Saying something's possible and moral are different things. It would be possible for an economy to function like that, but letting our economy function like that wouldn't be a moral thing to do.  Krugman can credibly say such an economy would function because he's made his stance about the morality of such an economy clear on numerous occasions.

    I object to violence because when it appears to do good, the good is only temporary; the evil it does is permanent.

    by Futuristic Dreamer on Thu Jan 24, 2013 at 12:39:10 AM PST

  •  Both Stiglitz and Krugman have Nobels (2+ / 0-)
    Recommended by:
    radarlady, EthrDemon

    Nobel prizes in economics. I pay attention to and give credence to what both of them say.

    Personal story: When I lived in Seattle, I knew a guy who built yachts (for rich people). He made a lot of money ($50/hour or more). And they used wood that was locally sourced and trucked to the construction site by local truck drivers. So they all had jobs that have a multiplier effect. The boat builders, lumbermen, and truck drivers pay for their houses, eat at restaurants, shop at clothing stores. That doesn't bother me. I'd rather have a rich person buy a yacht from a shipyard in Seattle than Athens or Shanghai or Seoul.

    On the other hand, I believe in progressive taxation (and raising the limit for FICA).

    Do you remember when it came out that Newt Gingrich had a million dollar line of credit at Tiffany's? So he buys diamonds from South Africa. That's not trickling down. You cut his taxes and his money flows to South Africa to companies that exploit their workers.

    It's complicated.

    “If you misspell some words, it’s not plagiarism.” – Some Writer

    by Dbug on Thu Jan 24, 2013 at 12:40:50 AM PST

    •  Separating the moral & economic implications (1+ / 0-)
      Recommended by:
      radarlady

      of a society that works like that is a good place to start.

      I object to violence because when it appears to do good, the good is only temporary; the evil it does is permanent.

      by Futuristic Dreamer on Thu Jan 24, 2013 at 12:59:29 AM PST

      [ Parent ]

    •  There is no such thing as a Nobel price in econ (0+ / 0-)

      The prize falsely taking that name is given out by a bank. Economics was never recognized as a science by Nobel.

      •  You're presenting a laughable straw argument. (3+ / 0-)

        The Nobel Prize for Economics has been accepted as a prize equal to say, the Nobel Prize for Literature or Physics for their respective fields. Yes, Nobel himself didn't mention Economics (probably because the field hadn't developed that much from its basic methodology and dogma yet but grew in the decades thereafter), but the name stuck and it is now regarded as the most prestigious and distinguished award, just like any Nobel prize is, for the field of study involved in the world. And you're discounting Stiglitz and Krugman for winning that?

        Oh, but you know better, apparently. You said in your previous comment you know that kind of economy couldn't work because Reagan etc.!1! Ever wondered that the politicized, corrupt and rigged "trickle down" you're talking about and have seen applied in history is not in the least comparable with the econometrically-defined economic model Dr. Krugman is talking about? Laughable. The people who talk most about certain topics with utter confidence are usually the people with the least actual knowledge when it comes to that very topic.

        Just fyi, Dr. Krugman never states (nor repeats) something before double or triple-checking his own calculations thoroughly. He will re-calculate and re-experiment other economists' findings before he talks about something as an economic fact. Somewhat more scientific and reliable than a non-Nobel Prize-winning person with no background in the field (apparently) running their mouth claiming to have the ultimate facts because they lived during the 80's (you think he hasn't, or something?).

  •  Quibble: It's "Downton Abbey," not "Downtown" n/t (2+ / 0-)
    Recommended by:
    Sharon Wraight, radarlady

    "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

    by bobswern on Thu Jan 24, 2013 at 01:27:36 AM PST

  •  I think you're missing the point. (9+ / 0-)

    What Krugman says is that such a system is economically possible - that, unpleasant as such an economy might be for the majority of the population, there is no intrinsic reason why such an economy shouldn't work.

    And this aspect of economics truly is not a morality play. You can divide economics into two great (and intertwined) subfields, positive and normative economics. Positive economics only deals with empirical questions, and has no use for subjective views. Normative economics, which deals with how something should be organised, on the other hand, has a subjective component, whether it's admitted or not.

    The flak Krugman has got over his comment is depressing, because the question whether he's right on this is extremely important for the left. If less unequal societies are more efficient, then if we assume evolutionary efficiency, the conclusion is that the problem of inequality will resolve gradually itself: If more equal societies are more efficient, states will have to become more equal or be relegated to a position of economic backwaters. Following this reasoning, our current era of inequality is simply a temporary aberration.

    If, on the other hand, Krugman is right, it means history is not necessarily on our side of the political spectrum: If both more equal and very unequal societies can be efficient, there is no economic reason why history should trend toward more equal societies, and economic engagement becomes far more important.

    Iuris praecepta sunt haec: Honeste vivere, alterum non laedere, suum cuique tribuere. - Ulpian, Digestae 1, 3

    by Dauphin on Thu Jan 24, 2013 at 02:05:10 AM PST

    •  Diarist may be missing the point, but got Krugman (1+ / 0-)
      Recommended by:
      Roger Fox

      into their title...

    •  There are intrinsic reasons (0+ / 0-)

      I state the intrinsic reasons that economy won't work above. I have deliberately written a very short diary and you refuse to read even a few paragraphs. You seem to be on autopilot in your comments.

      •  You simply stated that a Downton Abbey-style (2+ / 0-)
        Recommended by:
        Dodgerdog1, FloraLine

        economy would be unable to produce full employment in modern times. You referenced no data and no model.

        Iuris praecepta sunt haec: Honeste vivere, alterum non laedere, suum cuique tribuere. - Ulpian, Digestae 1, 3

        by Dauphin on Thu Jan 24, 2013 at 06:34:33 AM PST

        [ Parent ]

        •  Because it has already failed for three decades (0+ / 0-)

          At this point the burden of proof is on believers in trickle down. Do I really need to explain this on Daily Kos? The data is America and the model is free trade, deregulating, oligarchy running, bank serfdom.

    •  Nicely written comment (0+ / 0-)

      I would add the author took things out of context

      Leaving out this quote and basing the introduction on half the story

      haven’t been able to persuade myself that this particular morality tale is right.
      Well thats just a cheap literary vehicle, a cheap shot. See cfm's comment near by.

      FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

      by Roger Fox on Thu Jan 24, 2013 at 09:46:56 AM PST

      [ Parent ]

  •  Krugman has been a correct & courageous megaphone (1+ / 0-)
    Recommended by:
    Futuristic Dreamer

    on so much for so long that he deserves every benefit of every doubt.

    Krugman says of Stiglitz:

    He argues that high inequality is causing huge waste of human talent, because the poor and increasingly the middle class lack access to good education; and I agree. He also argues that inequality fosters financial crisis, and I agree with that too.
    On the narrower issue of the post-crisis growth impact of income inequality, if Krugman says that empirical analyses are not conclusive, then he is probably correct (since he usually is), although I tend to think that more analyses would eventually prove Stiglitz's position to be correct.

    In any event, wealth inequality, which does not appear to be covered by this mini-debate, is probably even more likely to reduce economic growth.

    •  Krugman has only been a megaphone for (0+ / 0-)

      America's minimal survival. If you read his theories on free trade you will see that he never gave up believing in an economy that simply doesn't work. He wants a huge injection of cash into our economy because he thinks we face only technical issues - not structural societal problems.

      •  Survival through truth-telling is much better than (0+ / 0-)

        the alternative of disaster through lies, and keeps us all alive and able to consider even better alternatives.

        Krugman refused to be intimidated from highlighting the dishonesty of W's economic policies, or the timidity of Obama's.

        If Krugman was a more fundamental critic of international capitalism, he probably would not have the credibility to have accomplished that highlighting.

      •  This proves how little of his work you read (0+ / 0-)

        I've seen him publish things that many people would consider openly anti-capitalist.

        I object to violence because when it appears to do good, the good is only temporary; the evil it does is permanent.

        by Futuristic Dreamer on Thu Jan 24, 2013 at 08:52:57 AM PST

        [ Parent ]

      •  Liquidity trap (0+ / 0-)

        FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

        by Roger Fox on Thu Jan 24, 2013 at 09:34:43 AM PST

        [ Parent ]

  •  This just tells us how little you know about (2+ / 0-)
    Recommended by:
    Futuristic Dreamer, Roger Fox

    the scientific method:

    And before you continue this hero worship nonsense on an argument of ideas please remember that Stiglitz, whom Krugman is disagreeing with, is the real hero, not Krugman.
    They are both heroes but that's beside the point. Stiglitz is "the hero" because he presents a theory that most suits our Progressive values? And if someone partially disagrees this is a statement of fact based on their own and other people's work, he falls out of favor? Do you always shoot messengers like that? Besides, "inconclusive" does not mean anything else but "inconclusive", aka it is not a fact without a reasonable doubt.

    Somehow I don't think one can get it through your head that Krugman is a KEYNESIAN, which means he is not saying this because he likes his findings - to the contrary. He's an economist first and he's not going to put on blinders when his own findings don't fit his political ideas. That'd be much more like the "other" side.

    •  Hi (0+ / 0-)

      First economics is not science. No macro-economics experiments can be run. Economics is more a subset of history that uses math. Second please read your Keynes

      Yet there is no country and no people, I think, who can look forward to the age of leisure and of abundance without a dread. For we have been trained too long to strive and not to enjoy. It is a fearful problem for the ordinary person, with no special talents, to occupy himself, especially if he no longer has roots in the soil or in custom or in the beloved conventions of a traditional society. To judge from the behaviour and the achievements of the wealthy classes to-day in any quarter of the world, the outlook is very depressing! For these are, so to speak, our advance guard-those who are spying out the promised land for the rest of us and pitching their camp there. For they have most of them failed disastrously, so it seems to me-those who have an independent income but no associations or duties or ties-to solve the problem which has been set them.

      I feel sure that with a little more experience we shall use the new-found bounty of nature quite differently from the way in which the rich use it to-day, and will map out for ourselves a plan of life quite otherwise than theirs.

      I have trouble seeing in his writing much support for the idea that he would agree that trickle down full employment is possible in 2013.
      •  I was talking about the scientific method and yes, (0+ / 0-)

        Economics IS a science, most accept it as a social science only but it is one no matter how you try to spin it. I beg to disagree that it's only a social science because the field is incorporating more and more exact sciences like neurobiology etc. at an astounding rate, but anyway.

        Second, I've read my Keynes, thank you. I know he fought against wealth disparity and income inequality and one of the most basic of Keynesian tenets is that they do stem economic growth, especially during recessions and a full-blown Depression - which is exactly why I mentioned that Krugman is a Keynesian and thus isn't taking this subject lightly.

        Dr. Krugman never talked about Reagan's and the US's following administrations' "economic" policies in this piece. Whenever he does mention them, he is of course absolutely scathing because he is a scientist with an incredible conscience and not someone who happily caters to oligarchs. What he was doing here, however, was commenting on his esteemed colleague Dr. Stiglitz's assertion about our particular post-crisis situation:

        It’s worth noting that two of Joe’s four points aren’t really about the current recovery. He argues that high inequality is causing huge waste of human talent, because the poor and increasingly the middle class lack access to good education; and I agree. He also argues that inequality fosters financial crisis, and I agree with that too.

        But we’re talking about the financial crisis aftermath, not the crisis itself.

        Krugman simply stated that his own studies showed that in the aftermath of this recession (which is a very different circumstance than the lead-up to a recession, an escalation into a depression, etc.) wealth and income disparity is not the single most damning factor holding back economic growth. This does not mean that he doesn't think that this disparity is one of the biggest systemic problems in economic policy in general when it comes to the US (and the mockery of "economics" that politicians come up with) - he's even talking about tax rates needing to be more progressive than they are in the very same piece. Nor does it mean that he agrees that income inequality should be completely disregarded as a factor in the stalling of economic growth.

        He is an adamant advocate for worker's rights, unions, and progressive economic ideals. He has talked about income inequality and wealth inequality as both morally reprehensible and economically self-sabotaging notions at length. What he said in this piece (when you read it in full) does not contradict his positions at all. Even when it pains him to do so, he puts scientific research first as a professional does.

        And again, the particular model Dr. Krugman is talking about is most likely not the "trickle down" you know and loathe - he'd be talking about the theoretical framework and the econometric construct untouched by the perversion of economic policy as perpetrated by Reagan and co. and the greed of the wealthy 1% who molded it to their personal benefit. You're simply confusing historical application with actual economics (don't blame you since hey, America has spat in the face of modern economics since Keynes entered the scene and transformed the field worldwide, which was over 85 years ago). And paraphrasing Dr. Krugman's comments: "This model MIGHT work in theory and be sustainable for a while, but that it's not a socially desirable one, nor the economically optimal one, and it's not the world I wish anyone to be in."

        Lastly, it's very... peculiar that you seem hell-bent on discrediting Economics as a scientific field, discrediting its most distinguished and most important award and calling people who talk about Krugman here "hero-worshipers". You seem to have a grudge you need to take out on those "economists" and especially on the politicians who perverted this science for decades and decades - and you are 100% wrong in working it out on Krugman or Stiglitz, the people who are ideologically on our side AND don't let their politics influence their scientific findings and theories. Don't confuse empiricism, science and objective research with moral, politically-loaded statements that aren't there. If research doesn't fit your tastes, don't just discount it, that's what Rightwingers do. You can do better than that.

        •  Economics is not science anymore than history is (0+ / 0-)

          Your post is very long but the definition of science is very short

          Science (from Latin scientia, meaning "knowledge") is a systematic enterprise that builds and organizes knowledge in the form of testable explanations and predictions about the universe.
          Nothing testable about what Krugman says in his post. We cannot test his idea that trickle down full employment is possible in modern America except by comparing it to historical events. That is why there is no Nobel prize for economics - hey there is no Nobel prize for mathematics either - it has the Fields Medal instead. The difference is that mathematicians are not arrogant enough to call a prize given out by a bank, Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, as a "Nobel Prize". As for my being down on economists, no more than Krugman is himself - he has several blogs on the fields spectacular failures of late.
          •  Oh God, this is even more pointless than I thought (0+ / 0-)

            I couldn't disagree more with everything you said. And now you're calling economists in general "arrogant"? That explains your massive grudge even more. Blame the guys who perverted the science to fit their political agendas in the United States and thus made a mockery out of the field unlike most of the rest of the developed world, don't blame the actual professionals.

             As for science - I was talking about economics as a field of study being a (social or otherwise) science, which is accepted by everyone in the academic world. Now you come up with a specific element about Krugman's post that you feel isn't "scientific" and that's supposed to prove your point about economics not being a science? Laughable, to say the least. And maybe try to study some actual economists, not the ones that let their conservative politics get in the way and have helped fuck up US economic policy for decades - something almost unseen in Europe, for example, with very few exceptions. Your whole premise of the diary is flawed, you keep taking things out of context, and seem to think that referring to a fucking tv-show portraying a different century is "proof" that this Nobel Prize winning economist is wrong. And whether you like it or not it is the most prestigious one in economics and should not be disregarded on the basis that Nobel himself didn't make one for this field. Plus, your reasoning about Nobel prizes are patently false: since when are "world peace" or "literature" an exact science one can test in the real world? World peace is not a science, Literature can't be "tested" either. You seem to think for a field to be scientific it has to be an exact science that can be applied and tested in the real world - yet everyone with a brain agrees mathematics is an exact science. Funny thing, eh?

            Tip: Learn something about the scientific method and what makes a field a social science and/or an exact science if you wish to talk about this topic ever again without sounding ridiculous.

            But this couldn't be more pointless either way. Just stop, for everyone's sake.

            •  Peace and literature (0+ / 0-)

              Peace and literature are greatly more verifiable fields than economics. Stopping a war is observable. A popular book is observable. Not much in economics can be judged in that fashion. Is the famous economist Friedrich Hayek similarly "bearing a grudge"?

              In his speech at the 1974 Nobel Banquet Friedrich Hayek stated that if he had been consulted whether to establish a [falsely named] Nobel Prize in economics he would "have decidedly advised against it "primarily because "the Nobel Prize confers on an individual an authority which in economics no man ought to possess... This does not matter in the natural sciences. Here the influence exercised by an individual is chiefly an influence on his fellow experts; and they will soon cut him down to size if he exceeds his competence. But the influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally."
              Mathematics is not a science. We cannot in a laboratory test mathematical assertions. Many famous proofs are only verifiable by other mathematicians and then just barely so. Maybe if you could use Google briefly before making these kinds of comments.
              •  If you start quoting folks belonging to the (0+ / 0-)

                Austrian school of "economics", I'm out. They are the very definition of a nutty fringe and they reject econometrics, statistics or any tool Economic sciences are based on. All of their non-peer-reviewed work (don't believe in that either) they have published has all been debunked and utterly eviscerated by actual economists as complete rubbish. If you start quoting Hayek, THE anti-economist, someone who believes in nonsense that has never been remotely helpful or correct, let alone has ever actually changed anything? If you had a shred of credibility left on this issue (not the case) it would be completely gone.

                And of course the guy has a grudge, he's not an economist, his "theories" are based on the antitheses of Economics! He's a joke.

                From attacking Economics as a field and not being able to discern it from politics to hurling generalizations and absolute falsehoods about the nature of the scientific method as applied in social and exact sciences (maybe you hadn't picked up on the fact that I was using the actual academic categorization and not your dictionary's narrow, compressed statement about what "science" in to talking about world peace as more of a science than Econ. (Good joke, by the way, but if you want to see WP in a scientific light, that'd require sociology, which you most likely look down upon as well or at least it'd make you feel bewildered that anyone would suggest it was a science) to quoting the ridiculous Austrian school as if that would even remotely help your argument, making up your own definition for what is and isn't a science (and abusing your dictionary, perverting the meaning you find - all in order to establish your newly cooked fact which the world must henceforth accept as universal truth!), to proclaiming with a straight face that literature is a more scientifically "verifiable" field (another good one!), using diversion tactics and laughable straw men at every turn...You're a hopeless case. You clearly have ZERO knowledge of Economics (academic or rudimentary) and also seem to possess many disturbingly large holes where  basic knowledge of the workings of the scientific method and how these relate to the multitude of fields of study out there ought to have been. 

                Have a nice day, I'm out as I mentioned before and will leave you to that astounding ignorance that is yours. Don't let that bother you, though: after all, ignorance is bliss!

                •  Friedrich Hayek also has a "Nobel" prize (0+ / 0-)

                  I was quoting a "Nobel" prize economist because I thought you respected people winning that prize. Probably though you don't have respect for anyone or anything - including Krugman, you just likely making completely irrational arguments that you consider clever.

                  •  He won a Nobel for his politically-tinged (0+ / 0-)

                    writings about the "socialistic calculation debate" and his Business Cycle Theory, which proved to be a colossal failure. These are the only two reasons given in the press release where they also gave the award to a polar opposite of his, Gunnar Myrdal. While the latter's work proved much more reliable, the joint award was given to make a political statement. The overwhelming majority of economists couldn't believe their ears, especially former winners. It became a controversy, and this was because Hayek had only proven up until then that his grand theory was as far removed from reality as possible, and only later started writing more extreme, economics-rejecting material which gave life to the Austrian school. It's the single most controversial pick and here you are using it as an example again?

                    Nah, don't think any of it is clever. It's all just basic knowledge of my own field of study which laymen like you are intent on misunderstanding completely. As for your comment about respect I can only chuckle at its stupidity. Good day.

                    •  So it comes down to (0+ / 0-)

                      trickle down full employment is viable because Krugman says so and you say Krugman is good and we should listen to you because you are an economist. Well thats all wonderfully circular. If you are that into solipsism why bother coming onto the internet?

                      •  What? I never said anything about trickle down, (0+ / 0-)

                        and neither did Krugman. He talked about the fact that his findings show income inequality isn't without a doubt the number 1 factor that created this post-economic crisis slump we're in after finally seeing economic growth the last few years. He agrees that this is a factor, that it is a serious problem. His past tells you clearly that he is an advocate for anything you can imagine that might help bridge the gap between the few wealthy and the duped masses. He's feared by the Republicans for a reason.

                        He found the data backing Stiglitz's statement inconclusive and said that a theoretical society with few rich and many poor might sustain itself for a while, economically, but is of course neither a desirable and moral one nor the economically optimal one. We suffered from these kinds of inequalities in the past too (and much worse than it is now, though of course the situation now is getting more and more dire) and these societies didn't necessarily break down the minute income and wealth disparity came into being. He feels there are many more factors in play for this aftermath of the recession.

                        That's all Krugman is saying. He never said anything about trickle down "working", he's talking about a pure economic model - I still don't know how you can keep confusing a theoretic model with a corrupt politicized system - and hates it.

                        I can't comment on who's "right" or not, or whether this can be put in absolutes, but it's just plain weird to see someone read Stiglitz's scientific conclusion - which was pretty much that in these particular few years after the recession the slump was caused solely by inequality - and decide because you're against wealth disparity he must be "the hero" here. Krugman, who is just as much against wealth and income disparity and has battled it a lot in his long career is then labeled as someone who is incompetent or a Republican because he finds Stiglitz's statements to have inconclusive evidence. Both economists are on the same side of the political spectrum and share the same goals and they had disagreement over data. That is a normal part of the scientific process.

                        But we're supposed to silence or decry the analysis of Dr. Krugman because you don't like a part of his objective conclusion? Given his past AND the rest of his piece, it's obvious Krugman doesn't like it being inconclusive one bit either but self-censoring goes against the nature of a scientist. That's FOX news's style, come on. Nuances don't seem to have gotten through here - nobody was arguing for trickle down or saying it's a desirable option.

                        •  Did you read the Stiglitz article? (0+ / 0-)

                          Here is the link

                          http://opinionator.blogs.nytimes.com/...

                          There is no point in my quoting out bits and pieces of such a short article. Your comment shows that you either haven't read this article or don't care about its contents. Either way impossible to have discourse about it until you do.

                          •  Um, yes, of course I read it. (0+ / 0-)

                            I think it's a fantastic piece. I have, however, been incorporating statements and stances I've read in Krugman's most recent books and Stiglitz's academic publications about "post-recession" problems and using them here because Krugman's and Stiglitz's pieces on their own would form a very narrow basis for discussion. These two haven't been actually commented on each other like this before but there has been for some time a slight contrast in their works - judging from the material I've read so far that is, I'm a Belgian master's student in Behavioral Economics at a British Uni and not a full-blown American academic with a career of 30 years or something under their belt - that helps put this in perspective, at least for me. Dr. Stiglitz has expressed that he feels that problems with wealth distribution are the biggest cause, Dr. Krugman has been looking at multiple factors (especially Congressional gridlock and austerity). His criticism of Stiglitz didn't come as a shock to me. They both deliver amazing work however and I admire their intellect and personal integrity. So I wasn't necessarily talking about Stiglitz's piece alone, I was in academic mode talking about both guys' stances up until now, generally speaking. I might not have been clear about that. But I think I have signaled the fact that I'm not willing to further this convo more times than should be necessary.

                          •  The difference is (0+ / 0-)

                            that Krugman thinks we can somehow dump money into the economy without it mostly going to the oligarchy. Then this "stimulus" would be enough to jump start our economy and all of the structural problems with wealth inequality and the devices in place to promote wealth inequality would fade to long term problems. Have you read Oligarchy, Spirit Level, Carlota Perez's works or The Great Stagnation?

                            The amazing disconnect with Krugman is that he keeps complaining about "serious people" preventing stimulus but of course this is the same faction that want inequality to continue. How he thinks he can solve his "stimulus" without first fixing inequality is beyond me. So long as increasing inequality is possible those with that much wealth are free to block all attempts at stimulus.

                          •  By and large I agree (1+ / 0-)
                            Recommended by:
                            disrael

                            with your comment.

                            From what I've read in Krugman's books I get why he's so adamant about stimulus (I am too) but sometimes he talks about it like it's a quick fix when a lot would need to change socioeconomically for it to ever actually become one. He can keep obsessing over stimulus so much sometimes he seems to be forgetting the grand picture because of it, at least that has been my impression reading his writings. It's of course an ideological tenet of Keynesian economics in the first place, that government intervention and stimulus are needed when times are bad so as not to sink further down into a depression while government needs to spend less in stimulus when times are good so as not to create surpluses because those are just as dangerous.

                            Now, it seems to me that Krugman's not naive and willing to literally dump money into the pockets of the oligarchy. He has studied those incredibly important factors that make truly beneficial stimulus impossible - and maybe most of his pleas for more stimulus ASAP were made because he thinks it's important at least something happens in the meantime, no matter how diluted the funds would become in the current political/economical climate. While he's obviously troubled by the problem of wealth disparity and has been vocal on the subject, Krugman has also been focusing more on a different issue than Stiglitz: he seems to be primarily interested in containing and reducing austerity while the latter seems to generally start at the level of the consumer and their needs to look at long-term effects (instead of the government's contract with its citizens and the ensuing responsibility Washington needs to honor that Krugman focuses on).

                            Dr. Krugman always writes how the government in general, governmental programs and policies have the largest role to play in whether the economy is a healthy one or not. He feels that increasing or decreasing SS, Medicaid, Medicare by just a little, or funding particular struggling branches and encouraging manufacturers to keep producing in the US, as well as having or dropping legislation for or against unionization, etc. etc. all make a world of difference, and we're getting worse on all of those points. He has called for a retooling of our economy in a way he has called "from the bottom up" - fostering a new attitude about government spending, especially for those who depend on it. He wants to do help undo the damage Reagan caused with his attitude about the relationship between government and citizen, that somehow government spending is irrational and works like consumers' individual financial budgets ("when you're in debt, you don't spend, you can only spend when you're not in the red").

                            In his books he names these factors as very important in order to create an environment where one can apply an effective stimulus but I've personally never heard or read Dr. Krugman talking about fixing the structural financial/power inequality first (while he does always call it inhumane and economically speaking just "inane"). On that front Stiglitz has indeed been more helpful in providing studies and theories on what to do to ameliorate the it. It seems to be a matter of priorities in both guys, and as long as there are economists who see eye to eye but are working on different pressing problems, there's still hope for the future. I respect both Dr. Krugman's and Dr. Stiglitz's views and especially their works and actions tremendously. Together they have made so many people more aware of the constant stream of classicist propaganda coming from the major tv networks/radio/other media and have both been educating the general public for years despite their numerous academic obligations, positions and studies (don't know how they find the time).

                            I haven't heard about those works you listed before so I haven't read any of them. I wrote them down and will check if my Uni's library has them, thanks!

  •  Please take more stuff out of context (0+ / 0-)

    FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Thu Jan 24, 2013 at 09:36:29 AM PST

    •  How is it out of context? (0+ / 0-)

      I'm not allowed to quote his full post or people like you will come out citing rules against that. If you don't care to read his original post or mine then just don't comment.

      •  I did. (0+ / 0-)
        haven’t been able to persuade myself that this particular morality tale is right.
        SO says Dr Krugman.

        AS far as your diary, the entire bit is a series of cheap literary vehicles, which all told garnered 2 recs in 7.5 hrs.

        Really..... yup really. My last wandering rant garnered 24 recs.

        But hey at least you got Krugman into the title.

        FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

        by Roger Fox on Thu Jan 24, 2013 at 06:45:11 PM PST

        [ Parent ]

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