Skip to comments.Paul Krugman is Wrong About Jobs and Income Inequality: Inverting Cause and Effect
Posted on 01/30/2014 11:30:22 AM PST by SeekAndFind
Looking forward to Obama’s State of the Union session, New York Times economic court jester Paul Krugman beats his usual drum about the importance of deficit spending (no, that’s not a joke, it’s what passes for liberal economic wisdom) and then tries to make a case for the left’s latest meme of “inequality” over jobs.
The usual suspects on the right will, as always when questions of income distribution comes up, shriek Class warfare! But there will also be seemingly more sober voices arguing that he has picked the wrong target, that jobs, not inequality, should be at the top of his agenda.
Heres why theyre wrong.
First of all, jobs and inequality are closely linked if not identical issues. Theres a pretty good although not ironclad case that soaring inequality helped set the stage for our economic crisis, and that the highly unequal distribution of income since the crisis has perpetuated the slump, especially by making it hard for families in debt to work their way out.
Moreover, theres an even stronger case to be made that high unemployment by destroying workers bargaining power has become a major source of rising inequality and stagnating incomes even for those lucky enough to have jobs.
The second point isn’t even an argument. Obviously unemployment leads to income inequality. If people don’t have jobs, their income falls. But that’s a case for focusing on jobs, the cause, not income inequality, the effect.
Paul Krugman turning that into his “stronger case” is a basic failure of logic.
Krugman’s first point is even more inverted. Income inequality didn’t create the economic crisis, botched attempts to remedy inequality with government subsidies that were monetized by liberal billionaires did.
The roots of the economic crisis lie in the intersection between Wall Street and the welfare state. That same intersection has given us Barack Obama, Paul Krugman and severe unemployment and income inequality.
The drum beaters for endless spending on the welfare state are perpetuating income inequality by pretending to fight it for their own profit.
Senator Elizabeth Warren Announces Hearings: "A Consumer Fraud Of Historical Proportions."
Using Karl Marx’s ideas to help the middle class is like using Adolph Hitler’s ideas to help the Jews.
But the middle class keeps voting for this crap, so what do you want me to say?
Even the discredited damnable homosexual fabian socialist John Maynard Keynes would flung Krugman if he were still alive and teaching economics.
If you have not seen them, take some time to read through three absolutely devastating blog posts by historian Niall Ferguson, who takes down Krugman as thoroughly and as well as any takedown I've ever seen:
The best one is the last one.
"This is by no means the only retrospective prediction Krugman has ever made, but it is surely the most shameless."
No, he learns from them. It's your, and mine as well, definition of "mistake" that's the problem.
Krugman's been rewarded for pushing gub'mint intervention as much as possible, regardless of the efficacy and/or outcome.
His igNobel prize? Awarded by a bunch of socialists for pushing socialism....
inverting cause and affect is what Krugman does a lot of
Excessive budget deficits increases the national debt, which increases the risk of default. In order to try to prevent that, the way to finance the deficits without having to raise taxes is large increases in the creation of money out of thin air, which leads to inflation. Inflation leads to higher sales revenues and nominal profits for business owners, at the same time that money wage rates are stagnant, which increases inequality.It is libtard policies that cause increased budget deficits, so, as usual,libtards have only themselves to blame for their own perversity of result.