Forget Ali - Frazier; ignore Santelli - Liesman; dismiss Yankees - Red Sox; never mind Silva - Sonnen; the new undisputed standard by which all showdowns will be judged happened in Spain over the weekend. During a debate on Europe’s crisis, Pedro Schwartz (a mild-mannered Spanish ‘Austrian’ economics professor) took on the heavyweight Paul ‘I coulda been a Fed Chair contender’ Krugman, and - in our humble opinion - wiped the floor with his Keynesian philosophy. From the medicinal use of more debt to fix too much debt, to the Japanization of world economies and the demand-side bias of every- and any-thing - interested only in the short-term economic growth; the gentlemanly Spaniard notes, with regard to the European crisis, the fact that “Keynesians got us into this mess and now we have to sacrifice our principals so that they can get us out of this mess”. Humble and generous in his praise - though definitively serious with his criticism - Schwartz opines: "Often Nobel prize winners are tempted to pontificate on matters that are outside the specialty in which they have excelled,"noting “the mantle of authority whereby what ever they say - whether sensible or not - is accepted with resignation from some and enthusiasm by others.” Krugman’s red-faced anger is evident at the conclusion as he even refused to shake Schwartz’s hand after the debate.
For 15 minutes of both education and entertainment - this is as good as it gets…
Starting from around 35:00 the Spanish professor praises and criticizes in a thoughtful and gentle tone
At around 39:00, he addresses the demand-side description of the world
Krugman’s less-than-happy response (which sparks quite a rowdy argument) begins around 48:20
Watch economist Robert Murphy take apart Paul Krugman. Oh, wait, you can also see him do it here. And here. And here he hits another Keynesian. In this piece, Murphy writes: “In this short commentary, Krugman has outdone himself. He manages to blend in a combination of (a) blatant, demonstrable falsehood, (b) misleading innuendo, (c) attacks on the motivations of those who disagree with him, and to top it off (d) a hypocritical implied criticism of the very policies he himself supported.” And here Murphy smacks down Krugman on the Fed and employment data.
Schwartz opines: “Often Nobel prize winners are tempted to pontificate on matters that are outside the specialty in which they have excelled,” noting “the mantle of authority whereby what ever they say - whether sensible or not - is accepted with resignation from some and enthusiasm by others.”
Unfortunately, I wasn’t in Madrid at the time (although, I wasn’t even aware Krugman was speaking here), so I couldn’t see this live.
Nevertheless, I think this is from the question and answers session of the same debate, here is Krugman’s response when asked on his advocacy of the housing bubble: “I was joking.”
I actually like Krugman’s answer / perspective around the 1:40ish mark to the inflation is theft question. The real concern is the monoplization of money by a central power, not some guarantee by a currency
I thought the Austrian’s performance in the debate was rather poor, and he came off as somewhat incoherent. He also failed to respond to Kruman’s so-called “definitive refutation” of what he calls “supply-side economics.” There is no clear, 1-1 relationship between high-powered money and prices; interest rates remain low in the face of high government spending due to the monetization of debt (alleviated the crowding-out-effect); no one believes that sharp cuts in fiscal expenditure yield automatic stimulative results.
Yeah I did. That made it obvious it was meant in humor and he wasn’t honestly suggesting a Nobel makes one automatically correct or something of that nature.
But the fact that Krugman has a Nobel was directly addressed and shot down in the debate (and then quoted in the summary). So it doesn’t quite work even as a joke.
It would be like someone saying: “JK Rowling has of course sold millions of copies. But simply writing a popular best-selling book doesn’t automatically mean you know what you’re talking about…especially when you pontificate in matters outside of your specialty.” And someone responds “Oh, but she has a book that sold millions of copies!”
And the way the OP is formatted, it’s kind of cumbersome to read and follow, so I was curious to know if he even read the full summary before posting that.
Apparently others thought it still worked as a joke.
So you’re saying that, when you asked Bogart “Did you even ready the summary?”, that wasn’t your way of saying “WHAT ARE YOU STUPID OR SOMETHING?! GOD!!!”?
Nevertheless, I think this is from the question and answers session of the same debate, here is Krugman’s response when asked on his advocacy of the housing bubble: “I was joking.”
Didn’t Murphy publicly withdraw his prediction of high inflation? I mean, obviously an expansion in the money supply won’t affect prices if it’s being stored in bank reserves because the Fed is paying them above-the-market interest rates to do so.
Paul Krugman is a pompous jackass. The fawning over him towards the end was disgusting.
I only listened to Pedro Schwartz’s speech and his answer at the end. I like how he pointed out the vilification of Austrian/free market people as really just being callous towards those poor unemployed individuals. Talk about ad hominem and straw man! Even if they didn’t care, that doesn’t refute the merits of their arguments.
