Economics

KRUGMAN UNDRESSES THE GOP

Paul Krugman: California proves the GOP's "extremist ideology ... is nonsense"

Paul Krugman | (Credit: Reuters/Chip East)

Salon

The New York Times columnist explains how California’s success puts conservative dogma to shame

In his latest column for the New York Times, award-winning economist and best-selling author Paul Krugman argues that California’s recent success — and Kansas’ ongoing failure — is yet more proof that conservative anti-tax dogma “is nonsense.”

After citing Justice Brandeis’ famous claim that America’s states are laboratories for democracy, Krugman turns to compare and contrast California and Kansas, noting that while the former state has seen economic growth and a successful implementation of Obamacare, the latter has had a stagnant economy and a ballooning deficit.

Not incidentally, these states decided to take opposite approaches to economic policy, with California embracing “a modestly liberal agenda of higher taxes, spending increases and a rise in the minimum wage” while Kansas “went all-in on supply-side economics, slashing taxes on the affluent” only to see paltry growth and a darkening fiscal picture.

“If tax increases are causing a major flight of jobs from California, you can’t see it in the job numbers,” Krugman writes. “Employment is up 3.6 percent in the past 18 months, compared with a national average of 2.8 percent; at this point, California’s share of national employment, which was hit hard by the bursting of the state’s enormous housing bubble, is back to pre-recession levels.”

Does Krugman expect the California example to change conservatives’ minds? Hardly. “Has there been any soul-searching among the prophets of California doom, asking why they were so wrong?” he asks. “Not that I’m aware of. Instead, I’ve been seeing many attempts to devalue the good news from California by pointing out that the state’s job growth still lags that of Texas, which is true, and claiming that this difference is driven by differential tax rates, which isn’t.”

Krugman then explains why Texas and California diverge — and how it’s not for the reasons right-wingers think:

For the big difference between the two states, aside from the size of the oil and gas sector, isn’t tax rates. it’s housing prices. Despite the bursting of the bubble, home values in California are still double the national average, while in Texas they’re 30 percent below that average. So a lot more people are moving to Texas even though wages and productivity are lower than they are in California.

And while some of this difference in housing prices reflects geography and population density — Houston is still spreading out, while Los Angeles, hemmed in by mountains, has reached its natural limits — it also reflects California’s highly restrictive land-use policies, mostly imposed by local governments rather than the state. As Harvard’s Edward Glaeser has pointed out, there is some truth to the claim that states like Texas are growing fast thanks to their anti-regulation attitude, “but the usual argument focuses on the wrong regulations.” And taxes aren’t important at all.

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

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

Paul Krugman, Laureate of the Sveriges Riksban...

Image via Wikipedia

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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