Music to read by:
Reflexes got the better of me
And what is to be must be.
Every day the bucket goes to the well,
But one day the bottom will drop out,
Yes, one day the bottom will drop out.
But I say:
I Shot The Ferret! Oh, Lord! But I Swear It Was In Self-Defence...Because He Was An Absolute Loon.
New York Times columnist Paul Krugman is right about one thing, when he says: “now, with Italy falling off a cliff, it’s hard to see how the euro can survive at all”.
It’s true that all European countries have more generous
social benefits — including universal health care — and higher
government spending than America does. But the nations now in crisis
don’t have bigger welfare states than the nations doing well — if
anything, the correlation runs the other way. Sweden, with its famously
high benefits, is a star performer, one of the few countries whose
G.D.P. is now higher than it was before the crisis. Meanwhile, before
the crisis, “social expenditure” — spending on welfare-state programs —
was lower, as a percentage of national income, in all of the nations now
in trouble than in Germany, let alone Sweden.
Oh, and Canada, which has universal health care and much more generous aid to the poor than the United States, has weathered the crisis better than we have. The euro crisis, then, says nothing about the sustainability of the welfare state.
Paul Krugman - Perpetually Wrong
"I have seen the future, and it works. O.K., I know that these days you’re supposed to see the future in China or India, not in the heart of “old Europe.”
- Paul Krugman, 19 May 2008
Krugman cites Sweden as an example of a social welfare success in Europe, but fails to mention two important points. Firstly, in recent years, Sweden has begun rolling back the welfare system and government expenditure while adopting important free market reforms. Secondly, Sweden decided to stay out of the eurozone, another key reason why it has so far kept out of the financial mess engulfing southern Europe. As Johnny Munkhammar, a Swedish member of parliament noted in a piece for The Wall Street Journal in January, Sweden owes its success not to welfare statism but to reforms that have increased economic freedom, including greater competitiveness in the provision of health care and other public services:
For many years, foreign policy-makers have pointed to Sweden as a positive model to follow, making Swedes like me proud. Too often, though, foreigners have drawn the wrong lessons from Sweden's success. For instance, whenever I give a lecture, anywhere in Europe, about economic reform, I always get the following response: "But you come from Sweden, which is socialist and successful—why should we launch free-market policies?"
The simple truth is that Sweden is not socialist. According to the World Values Survey and other similar studies, Sweden combines one of the highest degrees of individualism in the world, solid trust in well-functioning institutions, and a high degree of social cohesion. Among the 160 countries studied in the Index of Economic Freedom, Sweden ranks 21st, and is one of the few countries that increased its economic freedoms during the financial crisis. Sweden gets higher scores for liberal markets than Germany and Belgium, or reformers such as Cyprus and Georgia.
All of the European countries now in deep trouble in Europe – Greece,
Italy, Spain and Portugal – are in the 17-member eurozone, and have
deeply entrenched welfare systems, which have not been reformed along
the lines of the Swedish model. Germany also operates a large welfare
state and generous pensions structure that in the long run is
unsustainable, with its rapidly ageing population. But it has avoided
the current financial contagion by maintaining a budget surplus with the
introduction of strict austerity measures to limit government spending,
of the kind that Krugman would no doubt balk at if applied in the
United States.
“I’m not sure that the current value of the Nasdaq is justified, but I’m not sure that it isn’t.”
- Paul Krugman
In his piece Mr Krugman also makes the astonishing claim that the doomed European Project was originally “cheered” by American conservatives but “questioned” by US liberals:
The attempt to create a common European currency was one of those ideas that cut across the usual ideological lines. It was cheered on by American right-wingers, who saw it as the next best thing to a revived gold standard, and by Britain’s left, which saw it as a big step toward a social-democratic Europe. But it was opposed by British conservatives, who also saw it as a step toward a social-democratic Europe. And it was questioned by American liberals, who worried — rightly, I’d say (but then I would, wouldn’t I?) — about what would happen if countries couldn’t use monetary and fiscal policy to fight recessions.
I don’t recall “American right-wingers” cheering on the rise of the single currency, and the growth of a European superstate. Quite the opposite, in fact. British-style Euroscepticism has always been fashionable among US conservatives who have long admired Lady Thatcher’s views on Europe, but mocked and derided by the State Department and by the Left. American liberals in contrast have long been among the biggest supporters of the European Project. Witness the fawning Euro-federalism of the Obama administration as well as bastions of the ruling liberal elites such as The New York Times. Krugman is rewriting history now that the European model, beloved by East Coast liberals, is going down in flames.
"Paul Krugman has predicted 8 out of the last none recessions under the Bush Administration."
The reality that Krugman refuses to accept is that Europe offers a
glimpse of America’s future if it continues down the path of
European-style big government. The root of Europe’s financial crisis
lies in decades of over-spending and over-borrowing, largely to pay for
overgrown and bloated welfare systems, vast public sectors, and
incredibly generous pension plans. Europe has a huge entitlements
disaster heading its way, with graying electorates unable to sustain the
status quo. Added to this has been the disastrous euro experiment,
which has created a one-size fits all approach for 17 EU countries, with
varying levels of economic advancement. It has been a huge leap into
the dark, without a shred of democratic accountability.
There is only one path Europe can take if it is to avoid economic
meltdown: dramatic cuts in public spending, the dismantling of its
welfare states, the removal of crippling taxes and business regulations,
the downsizing of the public sector, and a return to self-determination
for EU member states. It is Europe’s lack of fiscal responsibility,
economic freedom, and national sovereignty, that are at the heart of the
current economic crisis, and the United States must do all it can to
avoid European-style decline.
"There's obviously a relationship
between tax rates and revenue. That relationship is not, however,
one-for-one. In general, doubling the excise tax rate on a good or
service won't double the amount of revenue collected, because the tax
increase will reduce the quantity of the good or service transacted. And
the relationship between the level of the tax and the amount of revenue
collected may not even be positive: in some cases raising the tax rate
actually reduces the amount of revenue the government collects."
- From "Economics," by former Enron adviser Paul Krugman and Robin Wells (Mrs. Krugman), second edition, 2009
"In
Democrat-world, up is up and down is down. Raising taxes increases
revenue. . . . But in Republican-world, down is up. The way to increase
revenue is to cut taxes on corporations and the wealthy."
- Paul Krugman, New York Times, 18 November 2011
Paul Krugman Has Predicted 9 Out of the Last None Recessions Under Bush Administration
1. "Right now it looks as if the economy is stalling..." — Paul Krugman, September 2002
2. "We have a sluggish economy, which is, for all practical purposes, in recession..." — Paul Krugman, May 2003
3. "An oil-driven recession does not look at all far-fetched." — Paul Krugman, May 2004
4. "A mild form of stagflation - rising inflation in an economy still well short of full employment - has already arrived." — Paul Krugman, April 2005
5. "If housing prices actually started falling, we'd be looking at an economy pushed right back into recession. That's why it's so ominous to see signs that America's housing market ... is approaching the final, feverish stages of a speculative bubble." — Paul Krugman, May 2005
6. "In fact, a growing number of economists are using the "R" word [i.e., "recession"] for 2006." - Paul Krugman, August 2005
7. "But based on what we know now, there’s an economic slowdown coming." - Paul Krugman, August 2006
8. "This kind of confusion about what’s going on is what typically happens when the economy is at a turning point, when an economic expansion is about to turn into a recession" - Paul Krugman, December 2006
9. "Right now, statistical models ... give roughly even odds that we’re about to experience a formal recession. ... The odds are very good — maybe 2 to 1 — that 2007 will be a very tough year." - Paul Krugman, December 2006
Bottom Line: In other words, to paraphrase Megan McArdle, Paul Krugman has predicted nine out of the last none recessions under the Bush administration.
Economist Donald Luskin and his army have accumulated a STUNNING amount of absolutely unbelievable errors that Krugman has made and you can find more by Googling "Krugman Truth Squad." The idiocies are truly breathtaking.
“Compare me . . . compare me, uh, with anyone else, and I think you’ll see that my forecasting record is not great."
- Paul Krugman
No shit, Sherlock.
Of interest:
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