Welcome to DU! The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards. Join the community: Create a free account Support DU (and get rid of ads!): Become a Star Member All Forums Issue Forums Culture Forums Alliance Forums Region Forums Support Forums Help & Search

pampango

(24,692 posts)
Mon Aug 25, 2014, 02:54 PM Aug 2014

Krugman: It’s not just facts that have a liberal bias; so does careful, open-minded analysis.

Here’s how it works: If you believe that we’ve spent the past six years suffering from a huge overhang of excess supply, that inadequate demand is the whole story — as Yellen does, I do, and so should you — you do have one slightly awkward question to answer: while inflation has been subdued, why hasn’t it turned into deflation? If labor is in huge excess supply, why are average wages still rising, albeit slowly?

Doves like me have taken that question seriously, and placed a fair bit of weight on downward nominal wage rigidity. If wages don’t fall except in extreme cases, you can explain average wages continuing to rise by the combination of sticky wages for some workers and rising wages for those workers who, for whatever reason, face better-than-average prospects.

What’s notable, then, is that you hardly ever see this kind of thing on the other side. Inflation hawks never lay out any specific model of how inflation is supposed to take off in a depressed economy; nor do they talk about testable implications of their view, or for that matter offer any explanation of why they’ve been so wrong for so long.

It is, in other words, an asymmetric debate from an intellectual point of view. Doves are doves because their analysis leads them to believe that rates should stay low, and they make a point of explaining that analysis, addressing its implications even if they don’t lend support to their policy case, and suggesting what information might lead them to change their mind. Inflation hawks know what they want, and don’t feel any need to explain clearly why or how they might be wrong.

If this reminds you of other debates these days, it should. It’s not just facts that have a liberal bias; so does careful, open-minded analysis.

http://krugman.blogs.nytimes.com/2014/08/25/yellen-wages-and-intellectual-honesty/

Just goes to show that even in discussions of economics (just like with climate change denial, cutting taxes for the rich), conservatives "know what they want, and don’t feel any need to explain clearly why or how they might be wrong." Liberals believe what they believe "because their analysis leads them to believe" it "and they make a point of explaining that analysis, addressing its implications even if they don’t lend support to their policy case, and suggesting what information might lead them to change their mind."

Conservatives never, never suggest "what information might lead them to change their mind" because the policy choice comes first and now amount of facts or evidence will "lead them to change their minds."

Latest Discussions»General Discussion»Krugman: It’s not just fa...