What becomes clear in sifting through the various right wing economic sites, is that one of their favorite sports is to play the game of 'What Krugman said then and what he is saying now." Currently, I just started reading Krugman's Accidental Theorist where he has the thought experiment of the hot dog and bun industries-to make the point of the lump of labor fallacy.
It's interesting though reading this it's clear why the conservatives are always playing this game; he was much more critical back then of leftist "stylists" like William Greider and Robert Reich. Conservatives like Stephen Williamson, Scott Sumner, and Bob Murphy complain that he doesn't right "smart pieces" like that anymore. There's a sense where econ guys like Williamson always feel that "we nerds are under seige" by "stylists."
A stylist in this context is simply someone who offers up empirical criticism of the economy and policies without any appeal to the mainstream econ models.
Has Krugman changed? In his own words yes: he sees the 2000 election as "radicalizing." He had once believed the Very Serious People (VSP) mantra that "both sides do it."
" Krugman had begun the work that would eventually win him the Nobel Prize—an aggressive revision of international trade theory—by the time he was in his mid-twenties, and so for nearly all of his adult life he has had good evidence for the proposition that he is smarter than just about everyone else around him, and capable of seeing things more clearly. Krugman is gleeful about being right, joyous in the revelation of his correctness, and many of his most visible early fights were with free-trade skeptics on the left. Of Robert Reich, for instance, Krugman wrote: “talented writer, too bad he never gets anything right.” He was a liberal and a Democrat, but even in 1999, when he was hired by Howell Raines to write hisTimes column, “I still saw equivalent craziness on both sides.”
"This evenhandedness began to disappear almost immediately. Four months after his first column, Krugman began studying the economic proposals of the Bush campaign and found, somewhat to his astonishment, that they were deeply disingenuous. “That was a radicalizing experience. Not just that the presidential candidate of one of America’s major political parties could say something that was demonstrably false, but that nobody was willing to say so,” Krugman says. “That was pretty awesome.” The Iraq War seemed insane to him, and he said so, forcefully. In 2003, these were sometimes unpopular positions, and Krugman and Wells found themselves turning to the progressive blogs; at times it felt as if it were the economist, his wife, and the Internet against the world."
http://nymag.com/news/politics/paul-krugman-2011-5/index2.html
The fact that the "evenhandedness" began to disappear so quickly, is to his credit: he's a quick learner. There are so many in the media that haven't learned now or are just starting to learn. Even his post Keynesian nemesis, Steve Keen, in his latest knock on Krugman-he claims Krugman doesn't understand his own IS-LM model- gives him considerable credit:
"Krugman describes himself as a “sorta-kinda New Keynesian”, and explains in his book End This Depression NOW! that New Keynesian macroeconomics evolved in reaction to the failure of the new classical approach to “explain the basic facts of recessions”.
"His “sorta-kinda” qualification is because both New Keynesian and new classical models derived from applying assumptions about the behaviour of individuals and markets at the level of the macroeconomy, and he has a healthy scepticism about these assumptions:
I don’t really buy the assumptions about rationality and markets that are embedded in many modern theoretical models, my own included, and I often turn to Old Keynesian ideas, but I see the usefulness of such models as a way to think through some issues carefully – an attitude that is actually widely shared on the saltwater side of the great divide.
"This is one aspect of Krugman that I genuinely applaud: the awareness that models aren’t reality. At best they are representations of reality, but some neoclassicals show an amazing capacity to believe that their models are reality – as in this piece by French economist Gilles Saint-Paul which the blog Unlearning Economics deservedly flogged recently – in a way that leads to truly delusional thinking about the real world."
Read more at http://www.nakedcapitalism.com/2013/03/steve-keen-krugman-doesnt-understand-is-lm-part-i.html#f657lWr641GbGkuK.99
While I appreciate Steve Keen's work and he may well be right that for real progress economics must throw out the Neoclassical baby with the bathwater, I've sometimes felt he was unnecessarily visceral about Krugman-like the time that he-or was it another MMTer-called for the NYTimes to fire Krugman.
For me, Krugman is a "public intellectual" in the best sense of that phrase. He has always seen his role as educating the public about economics and he takes that seriously. Even if some of what he says may sound more conservative in what he wrote back in the 90s-actually everyone was more conservative back then comparably, even me: I thought hat welfare reform was a good idea at the time; now I see that as the one big mistake of Clinton's presidency-he was always engaged and always took the human side of economics seriously too as suggested by this intro to "Accidental Theorist."
"At the heart of capitalism's inhumanity-and no sensible person will deny that the market is an amoral, and often capricious master-is that it treats labor as a commodity. Economic textbooks may treat the exchange of labor for money as a transaction much like a sale of a bushel of apples, but we all know that in human terms there is a huge difference."
The talk of Krugman leaving the NYTimes is silly as hopefully it's obvious that if Krugman did get thrown out it wouldn't be in exchange for Scott Fullwiler or Keen. And I appreciate the times he was there that there wasn't much else to hang your hat on. Like Christopher Hayes says:
Being a progressive during the Bush years imposed a certain kind of loneliness. Krugman helped relieve the loneliness. “You think, how could that be?” Hayes says. “And then Paul Krugman’s like, ‘No. It is rigged. You are right.’ ”
http://nymag.com/news/politics/paul-krugman-2011-5/index2.html
In light of Krugman's hot dog industries illustration in the 90s, a lot of conservatives wanted him to criticize Stiglitz's recent piece that argued that Americans were hurt by the rise of computers and the Internet in the early 2000s. He did not rise to the bait, however, and didn't accuse him of the "lump of labor fallacy."
It's one of those areas that economists just see differently than those of us who are interested lay people: it seems clear that following the 2001 recession where we lost 3 million jobs it took us a long time to catch up-it was called the jobless recovery. While ultimately the jobs were replaced most of these were much lower quality jobs. You saw a lot of white collar workers lose their jobs and never get back. Many of these people went from white collar offices to being burger flippers
Now does saying this commit the "lump of labor fallacy?" If there is one thing I'd like to see Krugman do now and again, it's engage Sumner: not too often and he's probably right to mostly ignore him. However, that recent piece that again talked about the "flaw of Keynesian economics" and claimed that the fiscal multiplier is zero-whether or not at the ZB-needed to be called out. Krugman would have provided a real public service for doing so.
http://diaryofarepublicanhater.blogspot.com/2013/03/sumner-educates-us-as-to-flaw-in.html
http://diaryofarepublicanhater.blogspot.com/2013/03/sumner-vs-noah-smith-on-multiplier.html
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