Samuelcanread takes on Krugman

by Gimpei | 09:36 in |

Over at Fusil of Yarn, samuelcanread takes on Krugman for tacitly approving of the inflation of a housing bubble back in 2002.

“Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.”

True, he was quoting. But he was quoting somewhat approvingly.

In the comments, samuelcanread adds:
I read it as Krugman saying we can’t let the economy deflate — that would suck so massively that it’s worth considering doing anything to get consumer spending going. Escape the liquidity trap!
I don't see that in the article. It seems like Krugman's setting up a trade-off between the economy going back into recession and inflating another bubble. He implies that a housing bubble would be good for Bush and Greenspan, but I don't get a sense of how desirable this would be for the US economy. There's no mention of liquidity traps, deflation, or Japan in this article so I'm not sure where samuelcanread is getting that from.

Maybe the problem here is that we're employing an overly structuralist approach to the text. Perhaps we need to employ a more post-structuralist approach, where the text in fact has a plurality of meanings and reverse meanings that are created by the reader. Since Krugman wrote the text, he is ultimately responsible for these meanings. Get out the pitchforks!

P.S. Did I just write that? Maybe I am going insane, or even worse... becoming Deirdre McCloskey.

2 comments:

  1. Anonymous on 18 June 2009 at 10:00

    Yes, he's bashing bush and greenspan.... but the one prescription he gives is that one. Unless you're saying he says it's time for the economy to double dip and the U.S. willl have to take its medicine. I'm ready to wrong, really. But you haven't proved that i have... his other columns of that period were all about "Oh shit, here comes the big D[eflation"

     
  2. Gimpei on 18 June 2009 at 11:25

    Yeah, my point was that judging from that article alone, his opinion on the matter was pretty indeterminate. If, in fact, he was bitching a lot about deflation at the time, then it would certainly add to your case. I seem to remember deflation being of pretty minor concern back then and that the bigger worry was that there would be a second recession. Then again, Krugman has been fixated on liquidity traps for along time...

    If he was just talking about a potential double-dip in the economy rather than a liquidity trap, he wouldn't have to propose the US economy taking its medicine or a real estate bubble. There's always fiscal stimulus or tax cuts that weren't simply a gift to the rich.

    I'd have to read all of Krugman's pieces from that time though in order to form any real opinion. I may be bored right now, but I'm not that bored.

     

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