Sunday, September 9, 2012

Krugman Draws the Truth Out of Rand Paul

There was a fascinating exchange on ABC's This Week with George Stephanopolous. Rand Paul was on to promote his new book and also Mitt Romney, but Krugman nicely pulled out the problem of Romney as a "weaponized Keynesian," which forced Rand to distance himself from Romney. Nice job Krug! Something Ron Paul and the rest of us have had a difficult time doing.

Here's a transcript of the exchange:

KRUGMAN: Right now, Mitt Romney has an ad blitz where he's accusing Obama of cutting defense spending, which is actually, you know, that's not really true, but and then he says and the reason this is terrible is it because it will eliminate jobs. So the Romney campaign's position is government spending can't create jobs unless it goes to defense contractors in which case it's the lifeblood of the economy... 
PAUL: And that's an inconsistency. That's an inconsistency.
KRUGMAN: It's pretty major.
PAUL: And it's wrong. They are accepting Keynes with regard to military spending...
KRUGMAN: Weaponized Keynesianism.


  1. Good, at least Rand didn't cave on this point.

  2. LOL. I've got to admit, that's a good line by Krugman. Unfortunately, my appreciation for him stops there. He tries to credit himself like he has in the past regarding his previous statement that the stimulus was inadequate.

    "It was one -- you know, one document that was released by his economists without a lot of thought early on, that has been -- but, no, the fact of the matter is, all of us who are serious about the numbers, me, for example, warned from the beginning that this one was going to be inadequate."

    While it is true Krugman argued the stimulus was inadequate, Murphy points out this was not because Krugman had the view that the economy was much worse than other economists thought. Rather it was because he thought their estimates were correct but people would still blame the stimulus for not doing anything since it wasn't really doing a whole lot.

  3. So riddle me this, did Krugman just blow up his own economic positions?

    1. No. He exposed Romney's hypocrisy (or massive ignorance.)Keynesian economics works.

    2. "Keynesian economics works. "

      You forgot to add "temporarily."

      Keynesian economics works, temporarily.

      But, that statement doesn't preclude the distortion of the production cycle that ensues from the phantom expansion of credit.