Saturday, November 23, 2013

Krugman’s Adventures in Fairyland

Mises Daily: Saturday, November 23, 2013 William L. Anderson  After studying and teaching Keynesian economics for 30 years, I conclude that the “sophisticated” Keynes­ians really do believe in magic and fairy dust. Lots of fairy dust. It may seem odd that this Aus­trian economist refers to fairies, but I got the term from Paul Krugman.  According to Krugman, too many people place false hopes in what he calls the “Confidence Fairy,” a creature created as a retort to economist Robert Higgs’s concept of “ regime uncertainty. ” Higgs coined that expression in a 1997 paper on the Great Depression in which he claimed that uncertainty caused by the policies of Franklin Roosevelt’s New Deal was a major factor in the Great Depression being so very, very long.  Nonsense, writes Krugman. Investors are not waiting for governments to “get their financial houses in order” and protect private property. Instead, he claims, investors are waiting for governments to spend in order to create enough “aggregate demand” in the economy to bring about new investments and, one hopes, full employment.  According to Higgs, the “humor columnist for the New York Times, Paul Krugman, has recently taken to defending his vulgar Keynesianism against its critics by accusing them of making arguments that rely on the existence of a ‘confidence fairy.’ By this mockery,” Higgs says, “Krugman seeks to dismiss the critics as unscientific blockheads, in contrast to his own supreme status as a Nobel Prize-winning economic scientist.”…. To Read More.....

My Take - It is constantly brought to our attention that Krugman won the Nobel Prize in Economics. How? There was a time when winning a Nobel Prize actually meant something, but for decades it has become a household joke. Obama won it because he became President, Yasser Arafat won the Peace Prize for ...... well..... I will have to think about that for a while. Jimmy Carter won it for not being George Bush. These clowns in Sweden have a propensity to make it clear what absolute fools socialists can be, so I have concluded Krugman touted all the socialist talking points that have failed everywhere they have been imposed on a hapless population.

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