Category Archives: Paul Krugman

Paul Krugman slams Wall Street for “undermining our economy and our society”

Paul Krugman slams Wall Street for "undermining our economy and our society"

Paul Krugman (Credit: AP/Lai Seng Sin)

I know this is the second consecutive Salon article, but economist, Paul Krugman has something to say and I wanted to share it…

Salon

The New York Times columnist argues that America’s large financial sector has done more harm than good

In his latest column for the New York Times, best-selling author and award-winning economist Paul Krugman argues that the financial sector of the American economy is not only outsized but that it’s hurting the economy and making Americans’ lives worse.

Citing journalist Michael Lewis’ new book on high-frequency trading — which opens with a story about an expensive tunnel being drilled for fiber-optic cable to cut down the communication time between Chicago’s futures markets and the stock market in NYC by three milliseconds — Krugman argues that American public policy has become overly influenced by high finance, with inequality and economic instability as a result. “[American] society,” Krugman writes, “is devoting an ever-growing share of its resources to financial wheeling and dealing, while getting little or nothing in return.”

After claiming that the large financial sector in the U.S. doesn’t increase overall prosperity and doesn’t promote economic stability, Krugman writes that its primary function seems to be to prey off of less powerful economic actors. “[Wall Street's] playing small investors for suckers,” Krugman says, “causing them to waste huge sums in a vain effort to beat the market.” The result, Krugman posits, is a select few Wall Street players making a lot of private profits while contributing little to the overall public.

Krugman continues:



In short, we’re giving huge sums to the financial industry while receiving little or nothing — maybe less than nothing — in return. [NYU Professor Thomas] Philippon puts the waste at 2 percent of G.D.P. Yet even that figure, I’d argue, understates the true cost of our bloated financial industry. For there is a clear correlation between the rise of modern finance and America’s return to Gilded Age levels of inequality.

So never mind the debate about exactly how much damage high-frequency trading does. It’s the whole financial industry, not just that piece, that’s undermining our economy and our society.

 

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Paul Krugman bashes Paul Ryan for yet another “con job”

Paul Krugman bashes Paul Ryan for yet another

Paul Krugman, Paul Ryan (Credit: Reuters/Bob Strong/AP/Mary Altaffer/photo composite by Salon)

Salon

It’s been a while since the New York Times’ premiere liberal columnist, Paul Krugman, had reason to flay one of his favorite targets, chief GOP wonk and former vice presidential candidate Paul Ryan. But with the GOP suddenly talking about how much it wants to help America’s poor — a development Krugman calls “fake compassion” — the award-winning economist and best-selling author once again has a reason to take Ryan to the woodshed.

In his latest column for the Times, Krugman writes that while Ryan’s new attack on liberalism —a lengthy report, supposedly on the efficacy of government-funded anti-poverty measures — is less of a sham than efforts from years past, the Wisconsin congressman has still ultimately produced “a con job.”

Krugman applauds Ryan for “citing a lot of actual social science research” but insists that the GOPer has falsely represented the conclusions of most of the research he cites. “In some cases,” Krugman writes, “Mr. Ryan and colleagues outright misstate what the research says, “drawing outraged protests from a number of prominent scholars about the misrepresentation of their work.”

But where Ryan’s report really goes wrong, Krugman argues, is in its ideological assumptions — chiefly, it’s unexamined belief that anti-poverty measures make the poor lazy and drains them of their ambition. “Mr. Ryan would have us believe that the ‘hammock’ created by the social safety net is the reason so many Americans remain trapped in poverty,” Krugman writes. “But the evidence says nothing of the kind.”

More from Krugman at the New York Times:



After all, if generous aid to the poor perpetuates poverty, the United States — which treats its poor far more harshly than other rich countries, and induces them to work much longer hours — should lead the West in social mobility, in the fraction of those born poor who work their way up the scale. In fact, it’s just the opposite: America has less social mobility than most other advanced countries.

And there’s no puzzle why: it’s hard for young people to get ahead when they suffer from poor nutrition, inadequate medical care, and lack of access to good education. The antipoverty programs that we have actually do a lot to help people rise. For example, Americans who received early access to food stamps were healthier and more productive in later life than those who didn’t. But we don’t do enough along these lines. The reason so many Americans remain trapped in poverty isn’t that the government helps them too much; it’s that it helps them too little.

Which brings us back to the hypocrisy issue. It is, in a way, nice to see the likes of Mr. Ryan at least talking about the need to help the poor. But somehow their notion of aiding the poor involves slashing benefits while cutting taxes on the rich. Funny how that works.

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Paul Krugman: GOP’s Obamacare lies hurt American families

Paul Krugman: GOP's Obamacare lies hurt American families

(Credit: AP Photo/ Francisco Seco)

As comprehensive and satisfying a take-down of the modern GOP as you will read…(Salon)

Salon

Award-winning economist and best-selling author Paul Krugman’s latest column for the New York Times is an unapologetic attack on the Republican Party for, in Krugman’s words, “trying to deceive voters” and, in the process, “deceiving themselves.”

What’s got Krugman riled up this time is the GOP’s official response to President Obama’s 2014 State of the Union address, in which Washington congresswoman Cathy McMorris Rodgers argued Obamacare “is not working” and, as proof, cited the experience of one of her constituents, Bette Grenier, who claimed to have seen her monthly premiums increase by a whopping $700.

Before explaining the problems with Grenier’s story, Krugman makes quick work of McMorris Rodgers’ assertion that Obamacare is not working. He notes that sign-ups, while slightly behind projections due to the disastrous rollout of Healthcare.gov, are nevertheless happening at a rapid speed, and that most insurance companies are thus far not concerned that the applicant pool is too old and sick (which could lead to higher premiums for everyone else).

“[T]he law,” Krugman declares, “is doing its job.”

Moving on to Bette Grenier, Krugman, like Salon’s Brian Beutler, points out that Gernier’s story almost immediately fell apart once it was examined by members of Washington state’s media.

The biggest problem with her tale was the fact that Grenier, if she wanted to, could have found a much cheaper alternative than the $700-hike plan, but she refused, saying, “I wouldn’t go on that Obama website.”

Moreover, Krugman notes that Grenier’s prior insurance was pretty bad — it was barebones, had “a $10,000 deductible” and “[offered] very little financial protection.”

But instead of blaming Grenier, Krugman charges Republicans like McMorris Rodgers, who rely on “misleading stories at best, and often outright deceit” in order to portray Obamacare as an unmitigated disaster.

“Who pays the price for this deceit?” Krugman asks. “In many cases, American families. Although health care enrollment is actually going pretty well at this point, thousands and maybe millions of Americans have failed to sign up for coverage because they believe the false horror stories they keep hearing.”

But they’re not the only ones. Krugman also engages in a little bit of concern trolling, warning the GOP that their confidence in Obamacare’s malfunctioning is leading them to a false sense of security about their chances in November’s elections. “[C]onservative politicians aren’t just deceiving their constituents,” Krugman writes, “they’re also deceiving themselves.”

“Right now, Republican political strategy seems to be to stall on every issue, and reap the rewards from Obamacare’s inevitable collapse,” he continues. “Well, Obamacare isn’t collapsing — it’s recovering pretty well from a terrible start. And by the time that reality sinks in on the right, health reform will be irreversible.”

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KRUGMAN: We Are On The Brink Of A Technology Revolution That Will Transform Our Economy

Paul Krugman, Laureate of the Sveriges Riksban...

As a quasi techie, this article caught my eye…

Business Insider

A life-changing technology revolution, which we thought it was decades away, is upon us, says economist Paul Krugman, author of “End This Depression Now!

“So far the information technology revolution doesn’t hold a candle to previous technology revolutions,” Krugman said in an interview with Business Insider editor-in-chief Henry Blodget.

“The really big revolutions were the ones that took place largely towards the end of the 19th century that actually powered growth for a long time after that.”

But now, with driverless cars becoming a reality, technology is closer to affecting our physical world – transportation, productivity and efficiency, among others.

Watch Krugman making the case against technology pessimists below.

http://www.businessinsider.com/paul-krugman-on-technology-and-the-economy-2013-2

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Paul Krugman Explains Why He Really Didn’t Want That Treasury Job, Anyway

A new commenter inadvertently led me to this article.  Thank you and welcome, Ed Darrell  for your   original suggestion to read You need to watch this: Paul Krugman, ‘Jobs NOW, the key to our recovery’ .

Washington Monthly

In a fascinating and sprawling interview with Bill Moyers, airing this weekend on the PBS show, Moyers & CompanyNew York Times columnist and Nobel laureate Paul Krugman explained why he didn’t want to be nominated to the post of Treasury secretary, even after 235,000 people signed an online petition urging the president to appoint him, and offers his take on Jack Lew, the president’s nominee:

PAUL KRUGMAN: …I probably have more influence…, doing what I do now, than I would if I were inside trying to, you know, do the court power games that come with any White House — even the best — which I don’t think I’d be any good at. So no, this is fine. And what the president needs right now is he needs a hardnosed negotiator. And rumor has it that’s what he’s got, so.

BILL MOYERS: In Jack Lew?

PAUL KRUGMAN: That’s right. The president can’t pass major new legislation. He can’t formulate major new programs right now. What he has to do now is bargain down or ride over these crazy people in the Republican Party. And we what we need now is not deep thinking from the treasury secretary. If the president wants deep thinkers, he can call Joe Stiglitz, he can call other people. What he needs from the Treasury secretary is somebody who’s going to be very effective at dealing with these wild men and making sure that nothing terrible happens.

But that’s not the most interesting part of the interview. Believe it or not, where it gets really fascinating is in Moyers’ discussion with Krugman on the difference between a recession and a depression. (As the title of Krugman’s new book, End This Depression Now!, he thinks what we’re in is the latter.)

While he concedes that the current depression, as he sees it, is not as horrific as the Great Depression of the 1930s, Krugman asserts that it’s likely worse than we perceive, because things that once made a depression obvious to all — breadlines, “will work for food” signs and the like — have take new forms in the the electronic age, and at a time when some public welfare, however meager, is available, and all acting in concert to hide widespread suffering from view:

KRUGMAN: Somebody said that food stamps are the soup kitchens of the modern depression. That there’re a lot of people who would be standing in line to get that soup, who are instead, and it’s a good thing, who are instead getting — I guess it’s now called SNAP, Supplementary Nutritional Assistance Program — but who are getting those debit cards, and are getting essential food stuffs. And they’re at the grocery store and they look like anybody else. But the fact of the matter is they are still as desperate, they’re getting by day to day with the aid of a trickle of government aid, just like the people who were standing in line at the soup kitchens in the ’30s, but they’re not visible. They, we don’t have guys selling apples in street corners partly because, you know, the city licensing wouldn’t allow that anymore.

I totally buy that. I know lots of people of all generations who consider themselves middle-class, but are living hand to mouth. The young people working marginal jobs with no prospects and an unimaginable pile of college debt. The middle-aged people short-selling homes that were theirs for years. The old people who never earned enough to invest in mutual funds.

I know them. Don’t you?

The complete Moyers interview:

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Paul Krugman: We’re In Big Trouble If Romney Elected

I believe that Nobel Prize winner for economics, Paul Krugman has been right since the beginning of the Obama administration regarding this country’s path toward economic recovery.

At that time, Krugman warned Obama in an editorial, that his stimulus was too small and would only slow down the country’s economic comeback.  As it turned out, he was right and he’s right about the country being in trouble if Romney is elected.

The Huffington Post

If Mitt Romney is elected president, the U.S. will experience an economic disaster the likes of which have been recently seen in Ireland, according to Paul Krugman.

“Ireland is Romney economics in practice,” the Nobel-Prize winning economist and New York Times columnist said on the Colbert Report on Monday. “I think Ireland is America’s future if Romney is president.” (h/t Politico.)

“They’ve laid off a large fraction of their public workforce, they’ve slashed spending, they’ve had extreme austerity programs, they haven’t really raised taxes on corporations or the rich at all, they have 14 percent unemployment, 30 percent youth unemployment, zero economic growth,” Krugman said.

Romney, the likely Republican nominee for president, recently suggested that the government should lay off more firemen, policemen, and teachers, according to CNN.Romney’s campaign website says that if elected president, Romney would aim to slash federal spending at least 18 percent by the end of his first term.

Conservatives like Romney loved Ireland’s economic program before the country fell into a depression, in part because it had “the lowest corporate tax rates,” Krugman said on the Colbert ReportIreland fell into recession again at the end of last year.

After Krugman finished his criticism of Romney’s economic plan, there was a pause as Colbert tried to think of a good retort. “Well the Irish can handle it, OK? The Irish do very well in bleak, depressing times,” Colbert said. “They’ve got those jigs and everything that they do.”

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Paul Krugman Appears On ‘Newsnight,’ Battles British Conservatives On U.K. Austerity Policies (VIDEO)

The Huffington Post

For most Americans, a trip to London means drinking a few pints and maybe taking a picture of one of those guards with the hats. For Paul Krugman, it means critiquing the entire direction of Britain’s economic policy.

Krugman, the Nobel Prize-winning economist and left-leaning New York Times columnist, appeared on the BBC program “Newsnight” this Wednesday, jousting with two British deficit hawks over the U.K.’s austerity agenda.

The Brits — venture capitalist Jon Moulton and Conservative Member of Parliament Andrea Leadsom — argued that the British government has to reduce spending if the country is to dig itself out of the economic slump it’s been in. Krugman countered that such a strategy could cause Britain’s economy to implode — since, he said, the public and private sectors need to circulate money to each other in order for anyone to prosper.Krugman Newsnight

“We are not a household. We are an economy,” said Krugman. “Your spending is my income, and my spending is your income.”

As Krugman pointed out during the “Newsnight” segment, and later in a NYTcolumn, the austerity question is one that extends beyond Great Britain. Eurozone countries are in the midst of their own austerity struggle right now, one whose effects have been felt most strongly in Greece, where government spending cuts have resulted in riots and strikes and boosted the political fortunes of the far-left, anti-austerity Syriza party.

And in the United States, economists and politicians are engaged in an ongoing debate over the best way to jump-start the lagging economy — and here, too, Krugman hasrepeatedly counseled against the kind of major government spending cuts that conservative policymakers have championed.

Krugman’s argument is that such cuts would cause a major contraction in the American economy, a point that even Mitt Romney, the presumptive Republican nominee for president, appeared to echo in an interview with Time a few days ago.

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Krugman: GOP’s Economy Strategy Is ‘Gigantic Con Game’

I’ve got a sort of geeky crush on Paul Krugman, mainly because he interprets our economic situation from a slightly left perspective and his presentation is actually comprehensible.

The New York Times

So the Republican electoral strategy is, in effect, a gigantic con game: it depends on convincing voters that the bad economy is the result of big-spending policies that President Obama  hasn’t followed (in large part because the G.O.P. wouldn’t let him), and that our woes can be cured by pursuing more of the same policies that have already failed.

For some reason, however, neither the press nor Mr. Obama’s political team has done a very good job of exposing the con.

What do I mean by saying that this is already a Republican economy? Look first at total government spending — federal, state and local. Adjusted for population growth and inflation, such spending has recently been falling at a rate not seen since the demobilization that followed the Korean War.

How is that possible?  Isn’t Mr. Obama a big spender? Actually, no; there was a brief burst of spending in late 2009 and early 2010 as the stimulus kicked in, but that boost is long behind us. Since then it has been all downhill. Cash-strapped state and local governments have laid off teachers, firefighters and police officers; meanwhile, unemployment benefits have been trailing off even though unemployment remains extremely high.

Over all, the picture for America in 2012 bears a stunning resemblance to the great mistake of 1937, when F.D.R. prematurely slashed spending, sending the U.S. economy — which had actually been recovering fairly fast until that point — into the second leg of the Great Depression. In F.D.R.’s case, however, this was an unforced error, since he had a solidly Democratic Congress. In President Obama’s case, much though not all of the responsibility for the policy wrong turn lies with a completely obstructionist Republican majority in the House.

That same obstructionist House majority effectively blackmailed the president into continuing all the Bush tax cuts for the wealthy, so that federal taxes as a share of G.D.P.  are near historic lows — much lower, in particular, than at any point during Ronald Reagan’s presidency.

As I said, for all practical purposes this is already a Republican economy.

Continue reading here…

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Get Krugman!

Paul Krugman, Laureate of the Sveriges Riksban...

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I agreed with Paul Krugman’s editorial and I agree with Dave Weigel’s assessment…

Dave Weigel – Slate

Early on Sunday morning, as the rest of NYTimes.com was turned over to 9/11 anniversary, Paul Krugman vented his spleen. Years of columns were condensed into a few pithy lines. “What happened after 9/11 — and I think even people on the right know this, whether they admit it or not — was deeply shameful,” he wrote. “The atrocity should have been a unifying event, but instead it became a wedge issue. Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.”

These were sentiments he’d expressed before, but he knew they’d set people off. He turned off the comment section. “I didn’t have time to sift through the predictable vast pile of obscene and threatening stuff looking for the rare entries that were fit to print,” Krugman says. So the reaction occurred away from the blog, on Twitter and in other columns. Jennifer Rubin accused him of “hatred and contempt for his countrymen.” Donald Rumsfeld picked up the essential tool of the angry op-ed reader:

Screen shot 2011-09-12 at 11.49.04 AM

On a day when everyone else was flashing back to 9/11/2001, I was flashing back to the days and months later, when criticism of the Bush administration returned, and the practitioners of it became, briefly, Emmanuel Goldsteins. Remember Susan Sontag? Remember the Dixie Chicks? Remember the campaign to “revoke the Oscar” from Michael Moore? There hasn’t been much criticism of the substance of Krugman’s remarks; denying that 9/11 and counterterrorism strategy became “wedge issues” is denying a few years of political history. The criticism is of Krugman for expressing it. He brushes the criticism right off.

“I’m not saying anything in that post that I wasn’t saying back in 2002, when people like him were riding high,” says Krugman. “And isn’t Rumsfeld ‘sweep everything up, related and not’ the poster child for 9/11 exploitation?”

If you’ve forgotten the “sweep everything up” reference, there’s a refresher here.

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Krugman: 9/11 made Bush, Giuliani become ‘fake heroes’

Paul Krugman, Laureate of the Sveriges Riksban...

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I’d have to agree with Nobel prize winner in economics, Paul Krugman on his assessment…

The Raw Story

This story may not be going away for a long while.

New York Times columnist Paul Krugman lashed out at the commemoration of the 10 year anniversary of September 11th, labeling George W. Bush and Rudy Giuliani as “fake heroes.”

On his “Conscience of a Liberal” blog Sunday morning, the Princeton economics professor didn’t lack in showing any temerity in his comments that certainly will upset conservatives.

“What happened after 9/11 — and I think even people on the right know this, whether they admit it or not — was deeply shameful,” he wrote. “Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.”

Krugman, who normally allows comments, also wrote that he wasn’t going to allow comments under this post “for obvious reasons.”

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