Memo to Keynesians

This is last year\’s Nobel Laureate speaking:

Stimulus spending probably doesn’t pay for itself….

You want to disagree with Paul Krugman then please go right ahead. And do show your working.

12 thoughts on “Memo to Keynesians”

  1. that might be more important if arguments for stimulus spending were predicated on its paying for itself.

    Tim adds: Try reading Richard Murphy….

  2. If properly targeted on infrastructure projects , a credit stimulus will almost certainly shew up in raised land values which can be recouped by a simple land value tax. This is the whole point of
    Post-Keynesian neo-Georgism.

  3. Ant & Dec are probably better economists.

    Richard Murphy’s influence on the UK left wing makes me want to weep.

    Tim adds: There is a reason I keep banging on about him…..

  4. All snark no substance again tim. Arguing that the benefits of fiscal stimulus exceed the costs in no way requires that the effect on the deficit be zero. In the same way one can argue that tax cuts are a good thing without pretending they are self financing.

    Tim adds: No, I’m afraid not. There really are people out there (R. Murphy for one) who say that fiscal stimulus “pays for itself”.

    That has nothing at all to do with whether it’s a good idea, whether other effects make it worthwhile. It’s a specific claim and it’s a claim which is wrong.

  5. Oliver-

    It’s worth noting that Krugman has argued at different times over the past year or so that fiscal stimulus can, in fact, “pay for itself”. The man is progressive, liberal Democrat political whore first, economist second.

  6. @7, someone who solely posts on blogs to slate liberals and Democrats, and who doesn’t have a Nobel prize, probably isn’t in the best position to criticise Krugman for partisanship.

    To recap:

    1) Krugman is a serious economist. If you disagree with him, that’s OK; if you think he’s not a serious economist, you’re a fucking moron.

    2) Richard Murphy is a fucking moron. If you agree with him, you’re almost certainly wrong; if you think he’s a serious commentator on anything, you’re also a fucking moron.

  7. johnb-

    I have a degree in economics from a reputable land grant college in the USA, which probably puts me one over on you.


    That I have a personal view on politics is just that… and not is not, in and of itself, an automatic disqualifion of my opinion. If you can muster the intelligence to refute what I say, have at it. At present, you’re simply taking the lazy way out to dismiss that with which you do not agree.

    Oh, and by the way, I think Paul Krugman is a very serious economist. And a very talented one.

    It’s just that I also think he’s a mindlessly partisan and fundamentally dishonest public intellectual and pundit as well.

    Rarely, if ever, does Paul Krugman allow economic truths to overshadow his ego and political agenda.

    That is what makes him a weapons-grade cockend.

  8. Dennis, can’t you keep the debates in your your head, rather than playing them out on this blog site?

  9. I would be astonished if someone found a quote by Krugman claiming fiscal stimulus pays for itself in the sense of not increasing, or even decreasing the government deficit.

    However, he has argued, quite rightly, that the benefits to society of fiscal expansion may well exceed the costs.

    These two statements are very, very different.

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