In this special episode of Contra Krugman, recorded live at the Mises Institute's Mises University summer instructional program for college students, Bob and Tom are joined by three other professors: Peter Klein (Baylor University), Lucas Englehardt (Kent State University), and Mark Thornton (Mises Institute).
Is a rising stock market an indication of economic health? Not necessarily, says Krugman, and on that he's of course correct. But what accounts for rising stock prices today? He says a lack of alternative options for investors -- another way of saying the economy stinks, even though he devotes half his columns to defenses of Obama.
This week, Krugman considers several possible explanations for why long-term interest rates are so low around the world. The one he settles on: investors have concluded that the weak economy is the new normal, so to speak, so they're willing to accept low yields. But this explanation contradicts Krugman's repeated insistence that the Obama recovery is stronger than ignorant right-wingers give it credit for. Which is it, Paul?
This week, Krugman is unhappy that Donald Trump has earned a reputation as a defender of workers. How can he be, wonders Krugman, if he doesn't support Obamacare, more privileges for labor unions, higher taxes on the rich, and so on?
Krugman urges the British to remain in the European Union, and thinks free-market arguments against it are mere fantasy. In fact, British exit from the EU would be a great step forward for freedom, as Bob and Tom show in this week's episode.
This week, Krugman suggests that the Republican Party attracts scammers and shysters who build email lists of gullible conservatives and then market fearmongering products or "get-rich-quick" schemes to them. Thank goodness the Democrats never do anything like that! They teach that the only way to prosper is through hard work and individual initiative, and.... Well, anyway, this is a juicy episode. Listen to it, or the world will end.
Krugman admits the recent job numbers aren't so good, but says there's an easy solution: fiscal stimulus. Waiting for actual examples of successful fiscal stimulus? You won't find them in this column, and for good reason....
This week, Krugman makes one decent point: successful businessmen aren't necessarily any good on economics. No argument there. Krugman doesn't quite get why his insight is true, but at least it's something. Bob and Tom discuss (1) why government can't be run like a business, (2) why falling wages need not be a catastrophe for "aggregate demand," (3) whether it makes sense to speak of a "manager" of the economy, and more.
In this column, Krugman takes things to a whole new level. He tries to draw lessons from the Clinton boom in the 1990s, which he incorrectly says was better than the Reagan boom, even though he himself admits there are no applicable lessons from that boom. It's awful, and we beat him to an intellectual pulp.
Show notes for Ep. 37
This episode was recorded before a live audience in Seattle on May 21, 2016, as part of the Mises Institute's event in Seattle. Krugman had been giving us thin gruel all week, but then, the day before the event, he gave us such a whopper of a column it was like a giant gift with a big red bow on it.
You'll never guess: Krugman contradicts himself this week, but only Bob Murphy, who knows Krugman's columns inside and out, caught him. This week the topic is whether it's a good idea at some point to repay the national debt at less than face value. Krugman is horrified, so maybe it's a good idea....
Surveying the economic stagnation in Europe, all Krugman can come up with is an alleged need for more government spending.
According to Krugman, we should embrace the ideas of Alexander Hamilton, particularly his view that the national debt is in fact a "national blessing." We are unconvinced!
Krugman is now blaming poor economic times (but hasn't he been trying to tell us things are much better than the stupid right-wingers say?) on a lack of competition. Lax antitrust enforcement is the problem! Sure it is. In fact, antitrust itself is the problem, as we show in this week's episode.
Krugman is upset this week at a judicial ruling that held that the government's case for naming MetLife a Systemically Important Financial Institution (SIFI) was inadequate and should be thrown out. Sure, it's impossible to nail down what the criteria for a SIFI are, says Krugman, but so what? We take on the whole issue -- not just MetLife, but the whole idea of extra regulation for so-called SIFIs.
Krugman argues that blinkered conservatives and cynical progressives alike have failed to appreciate the successes of the Obama presidency. He concentrates on four areas: the economy, health care, financial reform, and climate change. We concentrate on those areas, too -- and come up with rather different conclusions. Dan Mitchell, Senior Fellow of the Cato Institute, joins us as a special guest this week.
Show notes for Ep. 30
This week Krugman says we ought to acknowledge that there are losers in international trade, and that we should introduce government subsidies, rather than trade restrictions, to help them. He says right-wing ideologues have failed to make note of these losers, even though he himself failed to mention them in his own scholarly work on trade.
But we spend much of the episode defending the unpopular view that globalization is overwhelmingly and indisputably a good thing.
We managed to dig out some economics from yet another standard Krugman attack on the Republican Party. This time it's his skepticism about the existence of very much income mobility in America. We'll say this: if government programs had the record of success in this area that the (hampered) market economy has, Krugman would never let us hear the end of it.
Krugman discusses how economists should respond to the growth in sympathy for protectionism. Along the way, his Keynesian assumptions lead him to oddball conclusions. Bob and Tom also spend some time explaining the classical case for free trade and discussing whether that case has been vitiated in light of modern conditions.
Krugman says both Trump and Romney get the economics of trade wrong, but as usual, it's Krugman who makes his share of mistakes. With Bob on a lecture tour of Europe, Tom is joined this week by David Howden, chairman of the department of business and economics at St. Louis University's Madrid campus.
Bob and Tom use Krugman's column as a springboard from which to try to come to grips with the Trump phenomenon. Krugman does get a bit of it right this week, as it turns out, but whom are you going to look to on this, Krugman or Bob and Tom?
Paul Krugman criticized Bernie Sanders again last week, arguing that the numbers in his economic proposal don't work. In particular, he went after economist Gerald Friedman of the University of Massachusetts, arguing that his projected growth figures are far too high to be plausible. Friedman and others fired back, arguing that they were using Krugman's own models to reach their conclusions! Bob and Tom discuss and enjoy this exchange, and then give the Austrian view of the whole thing.
We couldn't pass up this column, called "On Economic Stupidity." If you want to rein in the Fed or not run deficits during a recession, you're just stupid. Here's our reply.
Krugman accuses Establishment man John Kasich -- of all people -- of supporting hard money. Then he tells us that balancing budgets hurts depressed economies. A tone-deaf understanding of American politics, plus old-fashioned Keynesianism -- that's Krugman, and that's what we discuss today.