Nobelist Paul Krugman has a propensity to spin and conceal. This allows for deception – the type of thing that hoodwinks some readers of his New York Times column. While deception doesn’t qualify as lying, it also fails to qualify as truth-telling.
Prof. Krugman’s New York Times column, “Hot Money Blues” (25 March 2013) is a case in point. Prof. Krugman sprinkles holy water on the capital controls that will be imposed in Cyprus. He further praises to the sky the post-1980 capital controls that were introduced in a number of other countries.
Prof. Krugman then takes a characteristic whack at all those “idealogues” who might dare to question the desirability of capital controls:
But the truth, hard as it may be for ideologues to accept, is that unrestricted movement of capital is looking more and more like a failed experiment.
Fine. But, not once did Prof. Krugman mention that there just might be a significant cost associated with the imposition of capital controls – a cost with which Prof. Krugman is surely familiar.
Before more politicians fall under the spell of capital controls, they should take note of what another Nobelist, Friedrich Hayek, had to say in his 1944 classic, The Road to Serfdom:
The extent of the control over all life that economic control confers is nowhere better illustrated than in the field of foreign exchanges. Nothing would at first seem to affect private life less than a state control of the dealings in foreign exchange, and most people will regard its introduction with complete indifference. Yet the experience of most Continental countries has taught thoughtful people to regard this step as the decisive advance on the path to totalitarianism and the suppression of individual liberty. It is, in fact, the complete delivery of the individual to the tyranny of the state, the final suppression of all means of escape—not merely for the rich but for everybody.
When it comes to capital controls, I think the Cypriots – even the non-ideologues – might be inclined to agree with Hayek over Krugman.
Krugman. Intellegence dies. What more do we need to sweep him and his et al's. into history?
Are you guys sure that's not Lenin with a hairpiece in the photo?
When you say that Krugman "sprinkles holy water on the capital controls that will be imposed in Cyprus," you are suggesting that he thinks that the Cyprus plan is a great plan, which he does not. He has stated that in his blog post, Pessimal Currence Area Theory:
"And Cyprus is now very overvalued — not only have the big capital inflows of yore dried up, a major export industry — offshore banking — has just died... Cyprus is now almost surely facing the prospect, not of recession, but of deep depression."
In the article you cite, he says that unrestricted capital looks like a failed experiment and cites various crises that resulted after there was a rush of foreign investors in a country and then a sudden rush out. That's what is going to happen in Cyprus now.
PK is a tool, most of his positions are based on Ideology. If the man had an ounce of consistency, he might be credible! When Bush was in office, he bemoaned the deficits, now we just can’t spend enough!
Is anyone keeping track of how many times Krugman is wrong?
Much easier to keep track of how many times he's right.
I can count the number of those times on the fingers of one foot.
Yes, me and its over $6 trillion times...
Krugman is a complete idiot !
Who is John Galt
Thanks Steve - great qoute
http://capitalismmagazine.com/2002/08/franciscos-money-speech
Why do Krugman and Bernanke rock these large beards? Is it because they're insecure with their appearance?
Krugman and his ilk - economic dwarf theorists - always make me want to reread Sartre's "No Exit."
INEZ: What's the matter?
ESTELLE: I feel so queer. Don't you ever get taken that way? When I can't see myself I begin to wonder if I really and truly exist. I pat myself just to make sure, but it doesn't help much.
"Nobelist Paul Krugman has a propensity to spin and conceal. This allows for deception"
Spin and conceal is deception.
"While deception doesn’t qualify as lying"
Deception is a lie.
Krugman is lying.
There are a few on here with distinct anti-jewish feelings.Grouping all jewish people into one.A feeling of hate.I couldn't care less if someone is Catholic,Jewish,Muslim or Buddist.In my opinion,these people that come on here and try to go the path of religious hate are way out of line.It goes along though with the whackos running Iran and meeting with neo-nazi groups from the States.By the way,the conspiracy theory left out the FreeMasons and Communists.
A cycle has two phases, up and down. There is no getting around that. Everything that has a cycle will end up "looking more and more like a failed experiment" as the down phase of the cycle progresses.
Nixon tried wage and price controls. Those failed, which Krugman should take note of in his zeal for capital controls.
Bernanke and Krugman seen on date together! Which on is on top?
Krugman is nothing more than an apologist for a failed economic theory. This would normally be significant but the death of Keynsianism will be a moot point once the dollar is replaced as the world's reserve currence as monetary policy will be set by an untouchable supra-national entity. I love my SDRs!