Krugman - I Love His Books, But His Blogs And Columns Are Misleading In Their Incompleteness

[Median Democrat]

I like Paul Krugman. I really do. When he is not trying to squeeze his thoughts into a 100 word post, he does a great job in providing an explanation of what is going wrong in the economy. Aside from his books, the following article in Rolling Stone is wonderful:

http://www.rollingstone.com/politics/story/26430979/obamas_bailout

However, when it comes to his columns and blog entries, Krugman takes shortcuts, and often resorts to cheap theatrics that are misleading. For example, in reading one blog entry, he referred to the proposed Toxic asset purchase plan as a "zombie idea." This was actually very confusing, because Krugman has taken great pains to use "zombie" to refer to banks with toxic assets on their books whereas Geithner's proposal was to insure the purchase of such assets to get them off the bank's books. Thus, while the proposal might be flawed, it did not result in zombie banks, but the opposite.

So, I am not going to start a I hate Krugman or I love Krugman thread. Rather, I am going to simply point out that despite his brilliance as an economist, Krugman's opinions and blog entries are contrained by time and space, and are not the best examples of his work and may actually mislead readers regarding what Krugman's actual views. For example, you might believe that Krugman is the second coming of Ralph Nader. However, if you read the Rolling Stone article, it is clear that Krugman has a much more balanced, appreciative view of Obama.

[Danger Mouse]

1. I think Krugman goes with flashy hyperbole to attract attention and fan flames.

It works.

[depakid]

2. "he referred to the proposed Toxic asset purchase plan as a "zombie idea."

Because that's EXACTLY what is is!

[Median Democrat]

4. I Know What A Zombie Bank Is, What Is A Zombie Idea?

I understand from Krugman himself that a zombie bank is a bank that is given enough capital by the government to stay in operation, but due to the presense of the toxio assets, it on its balance sheets, the bank is unable to lend, since it needs to maintain reserves. Thus, the bank is a "zombie" in that it is not lending, but just sucking up bailout dollars to avoid dying, which is the genesis of the "zombie bank" term of art.

However, I undeerstand that Treasuries plan is to assist private investors is buying the toxic assets from the banks, so that such assets do not appear on the bank's balance sheets, thus I wonder what is the zombie aspect of the idea, since it does entail taking the assets off the bank's balance sheets. Is there any article by Krugman describing "zombie ideas" and distinghishing between "zombie banks" or are "zombie banks" and "zombie ideas" the same thing?

[depakid]

5. The zombie ideas are what's characterizing this plan according to many economists

Keeping insolvent and under capitalized entities afloat for years with public injections of capital, public guarantees and subsidies. Similar to what was done in Japan in the 1990's.

[Imperialism Inc.]

6. I thought he was just making a pun. Since the plan is in essence the Paulson

plan with bells and whistles and token private equity participation that Paulson's idea had come back from the dead. i.e. it was a zombie.

[depakid]

7. I guess you could you could look at it that way as well

[RoyGBiv]

3. Seriously though ...

People looking for complete explanations to complex problems on blog posts are looking in the wrong places.

[Median Democrat]

9. Exactly - Its Like Its Written By Two Different People

Krugman's columns and blogs could very well be written by Ralph Nader given the venom with which he attacks the Obama administration. However, his books, and more in depth articles are much more fair if not supportive, which suggests that he tends to shoot for theatrics in his shorter pieces. For example, I also recommend Peddaling Prosperity, in which Krugman describes the economists for hire phenomenon where the right wing essentially funds any crackpot who will give their views some intellectual support such as Arthur Laffer and his Laffer curve, which is still pushed despite being discredited by reality.

[lamp_shade]

8. I wonder what Obama did to put Krugman's nose out of joint.