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Originally Posted by IIFFOFRDB
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(Hey, Lustylad! Now that fall has arrived, is Krugman-bashing still in season? I hope it's not strictly a summer sport.)
IIFFOFRDB, I assume that "CM" refers to me. Lustylad already gave a good answer to your question, so I'll only add one thought. Some economics pundit (can't remember who) opined shortly after the passage of the ARRA that, although it was designed to begin in 2009, the bulk of it was slated to pump up 2010, and thus it was aimed at the 2010 midterms by the partisan congressional staffers who wrote it. (That worked out great for partisan Dems, didn't it??!)
By the way, Casey Mulligan writes excellent stuff. I started off this thread ("Who Pays for Big Government?) with a piece by Mulligan:
http://www.eccie.net/showthread.php?...605&highlight=
(Of course, any time the subject turns to economics, it never takes long in this forum for some ignoramus to piss all over the place. See post #48.)
Krugman is perhaps today's most high-profile proponent of big government and massive "stimulus" programs. As noted numerous times in this forum, he whined incessantly that the 2009 "stimulus" was much too small(!)
Defenders of policies such as these are fond of rolling out all sorts of models purporting to support their views. Did you see the Blinder-Zandi paper, which concluded that the overall effects of interventions (both fiscal and monetary) since the financial crisis created or "saved" roughly 3.5 million jobs? And how did they come to that conclusion? Because their models said so, that's how! Just plug in some data somewhere (add an extra couple of hundred billion dollars of government spending, irrespective of what it's spent on, for example) and -- poof! -- hundreds of thousands of jobs pop up suddenly as if by magic! (But here's the thing, and I suspect it's no secret to most here. One can write a model that draws almost any conclusion you might want to see.)
Around six or seven years ago, Zandi famously stated that food stamp dispensation typically produced a fiscal multiplier of about 1.73. Drawing upon that bit of ridiculousness, Nancy Pelosi pronounced food stamps an excellent "jobs program." (Yeah, sure it is.)
If that sort of thing actually worked in the real world, its sheer wonderfulness would be readily apparent, wouldn't it?
Harvard's Bob Barro has done some excellent research on fiscal multipliers, and said some time ago that those for social spending are typically in the 0.5% range, and that in many cases appear to be "significantly closer to zero" -- a far cry indeed from Zandi's 1.73.
But Hillary Clinton and her acolytes will never listen to economists like Barro, instead preferring to follow the Krugman prescription, since it gives them ready excuses to propose all manner of bloated, vote-buying programs.
And if your favorite activity is buying votes with other people's money, doesn't it make perfect sense to laud economists who regularly give you tacit permission to do so?
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