An argument that questions the credibility of economists in general is that there are a number of disagreements among many economists, and not all of them can be right at the same time. In the case of Nobel Prize-winning economist Paul Krugman, these disagreements come from Krugman himself, as he holds contradictory opinions on a large number of topics.
For instance, we learn that when deficits are high, interest rates are low. However, we also learn that when governments run up a deficit, interest rates rise. So deficits cause interest rates not only to go up, but also to go down! In 1985, Krugman argued that the higher national debt and spending were bad for people early in their careers, as they would have to pay for it later in life. Nearly twenty-five years later, he argues that the national debt is not a problem, as it never needs to be paid off. According to him, we merely have to stabilize the debt instead of repaying it.
In the recent past, Krugman has been selling the idea that it is the debt-to-GDP ratio that matters and not the debt itself, but this claim flies in the face of his open letter to Alan Greenspan in which he asserted, "...you obviously realize that the ratio of debt to G.D.P. is a highly misleading number."
Deficits and spending are not the only topics on which Krugman has opposed himself -- he has claimed that the Social Security program is unsustainable, and also that it is sustainable; he has criticized those who have suggested that the Social Security funds be used for investing in private funds, while he has also advocated the idea that the Social Security funds be used to invest in private assets. He once opposed government-run health care before supporting government-run health care, and he also opposed the bailout of Fannie Mae before congratulating the government for the bailout of Fannie Mae.
His arguments on the issues of labor unions and minimum wage, too, run both ways. Labor unions and higher wages cause unemployment, while labor unions create a stable middle class, and lower wages have a contractionary effect on the economy. Krugman has also argued that governments do not cause recessions and are not responsible for business cycles, as it is the Fed that is responsible for business cycles, but he also blames the Bush administration for the current recession.
Likewise, Krugman proffers the argument that nothing the government has ever done has had an impact on the economy, and he claims that government actions are like using a water pistol to shoot an elephant -- but he also claims that the "big government" has saved us. He also certified himself silly when he claimed that workers' fears of losing jobs to workers in China and India due to globalization aren't irrational. Earlier, he had declared that those who blamed the global economy for the loss of jobs were silly.
To be fair to Krugman, his inconsistent statements are not deliberate, but subconscious. It would be wrong to attribute malice to his arguments when they can easily be explained by his ignorance of the subject. That would, however, not excuse the Nobel Prize Committee, which awarded its prize to a quack. Perhaps Krugman himself can explain why he disagrees with himself all the time. Maybe he can come up with not just one explanation, but two, each contradicting the other.
Below is a collection of actual quotes from Paul Krugman with links to sources. The quotes are arranged by topic and are in pairs (with an additional quote in one case), with the two quotes in a pair making arguments for contradictory positions.
The rest here.
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