"It is easy to confuse what is with what ought to be, especially when what is has worked out in your favor."
- Tyrion Lannister

"Lannister. Baratheon. Stark. Tyrell. They're all just spokes on a wheel. This one's on top, then that's ones on top and on and on it spins, crushing those on the ground. I'm not going to stop the wheel. I'm going to break the wheel."

- Daenerys Targaryen

"The Lord of Light wants his enemies burned. The Drowned God wants them drowned. Why are all the gods such vicious cunts? Where's the God of Tits and Wine?"

- Tyrion Lannister

"The common people pray for rain, healthy children, and a summer that never ends. It is no matter to them if the high lords play their game of thrones, so long as they are left in peace. They never are."

- Jorah Mormont

"These bad people are what I'm good at. Out talking them. Out thinking them."

- Tyrion Lannister

"What happened? I think fundamentals were trumped by mechanics and, to a lesser extent, by demographics."

- Michael Barone

"If you want to know what God thinks of money, just look at the people he gave it to."
- Dorothy Parker

Saturday, October 18, 2008

The Chorus and Cassandra
(or Caring is Creepy)

Megan McArdle writes
So the idea that Krugman has somehow won one for the team by predicting something that libertarian/conservative/free-market commentators didn't see coming is either misinformed, or lunatic.
Paul Krugman of course recently won the Nobel Prize in Economics.

McArdle was responding to Brian Beutler who wrote:
Time passed, and eventually conservative and libertarian writers--who either didn't understand what was happening, or didn't think all that highly of Krugman's liberalism, or both--began to mock him for getting his economic forecast wrong. Now, lo and behold, he wasn't wrong at all.
I've disagreed with Krugman over some things over the years, like Obama versus Hillary Clinton, but Beutler is absolutely correct here.

I've learned a ton from reading Krugman - among others of course - who wrote well in real time about Japan's "lost decade" of the Nineties, the failure of Long Term Capital Management, the Asian Financial Crisis of the Nineties, Enron and accounting fraud, etc., etc., etc.

Those of us, like Beutler, who studied Krugman are much better prepared to understand what's happening now with the global economy, and were much less surprised by the crisis. Also it was conservative and libertarian policy prescriptions which lead to the crisis in the first place, but that's a different argument.

In commenting on this Beutler makes an excellent point:
For literally years, Paul Krugman warned that we'd be in for some serious economic hard times when the housing bubble burst. This wasn't something he did as a game, but rather in the hope that rightly positioned people would address the problem. They didn't.
People of a social democratic persuasion who criticize free market ideology don't do so because they're somehow overly negative or fundamentally cynical, it's because they care.