A big point of contentions seems to be whether or not the 2008 slump was a 'financial-induced recession', because as Reinhart and Rogoff say these have slower-than-average recoveries, this benchmark then makes the current recovery look better; in contrast, compared to the average recession the recent recovery looks worse.
My old mentor Hyman Minsky argued that most recessions are financially induced, from excessive leverage, creating a panic as investors stop rolling over debt and cash flow long-since became negative. The Ponzi borrower borrows based on the belief that the appreciation of the value of the asset will be sufficient to refinance the debt but could not make sufficient payments on interest or principal with the cash flow from investments; only the appreciating asset value can keep the Ponzi borrower afloat. This applies perfectly to many zero-down home buyers circa 2005-7.
Reading Minsky you'll see he applied this mechanism to most recessions (eg, not 1945), and so there's at least one expert--of good faith, not ignorant--who disagrees with Reinhart and Rogoff. Anyway, John Taylor classifies 1882, 1893, 1907, 1913, 1929, 1973, 1981 and 1990 as 'financially induced.' Krugman says 73 and 81 were not 'financially induced' because they were orchestrated to combat inflation, a novel addition to the classification. Then they get into where to start the recovery, and how far out to go. When the debate gets into such semantics, it becomes pointless.
Krugman laments that 'politicization is hurting economics', though he is economist number 1 for having prestige and throwing around ad hominem like liar and consistently assuming that those he disagrees with cannot possibly be intelligent and honest. DeLong's posting are even better for over-the-top ad hominem, but he's in such a strange echo chamber he doesn't realize he's disqualified himself from so many positions he covets because even his team understands that rank partisanship becomes a liability at some point (no more Assistant Deputy Secretary positions, but rather, senior adviser posts for groups like the Rent is Too Damn High Party).
You just have to stop and remember: on any big debate, to think that one side is only motivated by ignorance or deceit doesn't understand the debate. Sure, some, even many, on any side of a big debate are ignorant are tendentious, but as with benchmarking this past recession, reasonable people can quibble with vague categorical definitions.
I enjoy reading the daily venom from Krugman and DeLong because they are proud to be angry as if their righteous indignation makes them more compelling, unaware that losing one's temper is a good signal you've lost the debate.
My old mentor Hyman Minsky argued that most recessions are financially induced, from excessive leverage, creating a panic as investors stop rolling over debt and cash flow long-since became negative. The Ponzi borrower borrows based on the belief that the appreciation of the value of the asset will be sufficient to refinance the debt but could not make sufficient payments on interest or principal with the cash flow from investments; only the appreciating asset value can keep the Ponzi borrower afloat. This applies perfectly to many zero-down home buyers circa 2005-7.
Reading Minsky you'll see he applied this mechanism to most recessions (eg, not 1945), and so there's at least one expert--of good faith, not ignorant--who disagrees with Reinhart and Rogoff. Anyway, John Taylor classifies 1882, 1893, 1907, 1913, 1929, 1973, 1981 and 1990 as 'financially induced.' Krugman says 73 and 81 were not 'financially induced' because they were orchestrated to combat inflation, a novel addition to the classification. Then they get into where to start the recovery, and how far out to go. When the debate gets into such semantics, it becomes pointless.
Krugman laments that 'politicization is hurting economics', though he is economist number 1 for having prestige and throwing around ad hominem like liar and consistently assuming that those he disagrees with cannot possibly be intelligent and honest. DeLong's posting are even better for over-the-top ad hominem, but he's in such a strange echo chamber he doesn't realize he's disqualified himself from so many positions he covets because even his team understands that rank partisanship becomes a liability at some point (no more Assistant Deputy Secretary positions, but rather, senior adviser posts for groups like the Rent is Too Damn High Party).
You just have to stop and remember: on any big debate, to think that one side is only motivated by ignorance or deceit doesn't understand the debate. Sure, some, even many, on any side of a big debate are ignorant are tendentious, but as with benchmarking this past recession, reasonable people can quibble with vague categorical definitions.
I enjoy reading the daily venom from Krugman and DeLong because they are proud to be angry as if their righteous indignation makes them more compelling, unaware that losing one's temper is a good signal you've lost the debate.
11 comments:
"...they are proud to be angry as if their righteous indignation makes them more compelling, unaware that losing one's temper is a good signal you've lost the debate."
Falcon, you are so far above the mass-man you can' even fathom that righteous indignation DOES make them more compelling. It is why they are celebrities.
The post you are citing is actually one in which Mary Matalin calls Krugman a liar, not the other way around. DeLong can come off as unhinged but I don't tend to find Krugman any worse than commentators from the right. I actually think John Cochrane often sounds the most dismissive and condescending of most of the economists/financial bloggers that I follow. It's not so much that he disagrees with other viewpoints, but that I've seen him multiple times dismiss them as clearly stupid without examining any evidence. I would say Krugman at least seems to do an OK job talking about the evidence for his views.
Eugene Fama has made just as many "extreme" arguments. It's funny how you apply the word "partisan" with a bunch of toothless illiterates known as the Teabaggers holding near identical views to your own Falk. But you don't care to discuss that one do you Falk??
Want to read a boatload of PARTISAN CRAP?? Start at square one here: http://www.amazon.com/Getting-Off-Track-Interventions-PUBLICATION/dp/0817949712/ref=sr_1_6?s=books&ie=UTF8&qid=1351166507&sr=1-6&keywords=john+taylor+economics
Make sure they lower the price $9.73 before you buy it though.
Take basically any statement DeLong has made (give specific example please) and tell us that it is not anymore "partisan" than the crap regularly quoted from American Enterprise Institute (AEI) or the Hoover Institute. Other than that. I suggest you STFU on cheapshots at DeLong. Falkface
unaware that losing one's temper is a good signal you've lost the debate.
Yeah, generally people who have the upper hand on facts and reason focus primarily on issues of temperament and tone.
Krugman has increased the frequency of the word 'lie', which isn't helpful. It's a bad word because it implies conscious malice, and usually one sees their opponent as misrepresenting the truth. Everyone sees what they believe, however, so it's not that anyone is consciously mistating facts, they just thing some are more important than the ones you do. Anyway, to presume one side of any debate engages in more of this than the other is naive.
As per DeLong, I didn't think quotes, as more than half of his posts drip condescension towards the 50% or so of the public. E.G.:
'NO. YOU HAVE NO BUSINESS VOTING FOR ANY REPUBLICAN, FOR ANY OFFICE, AT ANY TIME IN THE FUTURE, EVER. WHY DO YOU ASK?'
YES. ROMNEY LIES. ABOUT EVERYTHING. WHY DO YOU ASK?'
'No. Paul Ryan and Kevin Hassett have absolutely no shame or honor. Why do you ask?'
The question at the end implies any reason offered must be absurd, though the assertions are to my mind the rantings of an angry child.
'WHY OH WHY CAN'T WE HAVE A BETTER PRESS CORPS?'
These sarcastic statements don't illuminate, they are a different way of saying 'You're stupid!', which while more eloquent retains the profundity (ie, little).
It is improbable that DeLong thinks anyone alive who disagrees with him on politics, the big issues (ie, not just whether the stimulus should be $1 vs. $2T), is both honest and intelligent. That's an ignorant belief.
As per your use of 'STFU', 'Falkface', 'Teabaggers', and 'toothless illiterates', these angry remarks highlight your frustration that half the world disagrees with you. They don't help you think more clearly, and don't force me to address an important argument, so it's just irrelevant to me and damaging to you. Anger and rage are correlates with youth, or rather, ignorance.
I still agree about DeLong, which is the main reason I never really read him too much. As far as Krugman, you're right that he uses the word lie reasonably frequently, although mostly in reference to politicians and political commentators as opposed to other economists.
I actually don't necessarily believe it is naive to think that one side lies more than the other in current US politics though. The reality to me seems to be that what current Republicans are selling is impossible, whereas what Democrats are selling is undesirable (or maybe desirable depending on your philosophy). You can have a workable Democratic "ideal" society, which would probably look something like Nordic countries with somewhat less taxation and social spending. You can have a workable Libertarian "ideal" society, with low taxes and a very limited social safety net. It seems to me that you can't have a workable Republican "ideal" society, with low taxes, a large military, and high spending on the social safety net for the elderly.
Romney's support for a bigger military is the main reason I'm not too excited about this election: either way I'm going to be disappointed.
I don't see either administration preventing our slide into bankruptcy. In fact, I sometimes think Obama would be better because we would get their faster.
I think the medal for "most angry with righteous indignation" goes to Mr. Karl Denninger of Market-ticker belonging to the libertarian camp.
"It's funny how you apply the word "partisan" with a bunch of toothless illiterates known as the Teabaggers holding near identical views to your own"
Wow, someone here really hates middle class white people - which is who the teabaggers really are.
I guess such venting is still an easy way to score status points, but keep your finger to the wind - you will not want to be in the last crew of fools expressing this type of blind hatred.
@Anon #2
"The post you are citing is actually one in which Mary Matalin calls Krugman a liar, not the other way around"
If I remember correctly, Krugman posted a video of an Arcade Fire song in response to Ryan, which repeats the chorus of "Lies! Lies!"
http://krugman.blogs.nytimes.com/2012/08/31/friday-night-music-lies-lies/
That's about as blatant as you can get, and it was only the third result in Google for "Paul Krugman lies". All of which were as bad, or worse. Where was the evidence in the post you claim he always provides?
As for your Cochrane comment, I imagine it's because you're a Liberal and you find it hard to believe that anyone who agrees with you could ever be as bad as someone who disagrees with you. That's probably what possessed you to say "DeLong can come off as unhinged". Could you sugar coat it more? He has a "Stupidest man alive" nomination that he has handed out to Stephen Williamson, Don Bordreaux, Mark Perry, John Tierney, and Bryan Caplan, which are, once again, the first results in Google.
@Falkenstein
"Romney's support for a bigger military is the main reason I'm not too excited about this election: either way I'm going to be disappointed."
I'm just curious how much of a Republican you really are. I mean, don't get me wrong, I'm a free market guy and I find myself unknowingly siding with them, but it seems you disagree on issues that differentiate Republicans from, say, Libertarians.
well, I'm not a Republican so much as a libertarian who generally votes Republican because I think they are more consistent with my beliefs. I'm a big pro-Israel guy, but I think the US defense budget could be cut in half to deal with our problems, and we should just butt out of most of the world. Milton Friedman, Ron Paul, are more like my perfect candidates.
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