Bernstein to Krugman: Suck it!

[DrToast]

Okay, he didn't use those words, but he essentially said that in a polite way.

...Bernstein acknowledged that there were "honest disagreements" among economists on these very issues. But, he added, some of the progressive arguments against the administration - mainly that the White House has been tougher on the auto industry than Wall Street or has catered too willingly to the needs of the big banks -- failed to acknowledge the recent good news on these fronts.

"Take Paul Krugman, who I suspect is on a similar page as Bob ," said Bernstein. "Here is, I have to say, where I have found myself being in meetings with the folks in the administration, pursuing our strategy and reading everything from the critics on the outside, and I have found the critical arguments not entirely convincing. ... I think a lot of people thought that the banks who scored badly under the stress test and you can bend the curve anyway you want, would have great difficulty going out to financial markets and raising capital. But in fact they have been able to do that in ways that I think have been somewhat surprising and heartening. So I think basically since there are so many different ways of going at this and nobody really knows the right way I think you have to look at the outcomes. And I think the outcomes have actually been pretty favorable ... in terms of efficiency and in terms of protecting the taxpayers."

http://www.huffingtonpost.com/2009/06/01/white-house-krugmans-bail_n_209788.html

[MercutioATC]

1. Time will tell who is right.

I'm betting that Krugman is closer to the truth.

[Larkspur]

5. Me too!

The banks posted how well they were doing but what was not told to the public is that the banks don't have to disclose their losses at the same time they disclose their earnings, so the bank's healthy picture is a bit of a con game.

[lyonn]

10. Reminds me of people who frequent casinos

You hear about their wins but not their losses.

I don't know enough about economics to have an opinion so I am still waiting to see if Krugman is right or the Administration. I am rooting for our Pres - what can I say..... Geitner (sp?) still gives me pause.

[mkultra]

77. he has already backpeddled due to current results

in effect, he has already been shown partially wrong.

[Eric J in MN]

2. Jared Bernstein defines "protecting the taxpayers"...

...as Tim Geithner giving a trillion dollars to hedge funds.

In non-recourse loans.

non-recourse = the hedge funds keep the profits when the property they buy with the loans goes up in value, and the taxpayers absorb the losses when the property hedge funds buy with the loans goes down in value.

[DrToast]

3. Krugman defined "protecting the taxpayers"...

As nationalizing the banks and assuming their losses.

Krugman also said that banks wouldn't be able to raise enough capital. Thus far, he's wrong.

[Larkspur]

4. That's not entirely true

Krugman favored putting the banks in receivership, like the way FDIC does and the way FDR did.

[DrToast]

6. Except there isn't a dedicated insurance fund for many of these institutions

So who do you think gets stuck with the bill?

[Larkspur]

19. That's because Summers under the Clinton Admin refused to regulate

credit default swaps, which were held by AIG. Credit default swaps acted as insurance but the banks and their minions, like Larry Summers and Tim Geithner, didn't want them to be regulated like insurance companies, so they allowed the banks and companies like AIG to regulate credit default swaps themselves. Just like with the 1920-30's robber barons, Wall Street today could not regulate themselves.

If credit default swaps are not regulated in the future, then our economy is being setup for another fall.

[girl gone mad]

26. Bondholders, as it should be.

[TankLV]

72. Krugman would be RIGHT...

He has a LONG track record of being RIGHT...

[Baikonour]

78. Shh. Don't tell the haters that. n/t

[Larkspur]

7. These comments show that Krugman was hitting close to home for the WH

on this issue along with other progressive economists.

And I agree with the progressive economists, that Obama's Admin favors Wall Street over Main Street right now. Today Obama said that GM workers being laid off are sacrificing for the future, but those words don't put food on the table or pay the mortgage. those workers don't have the millions in the banks like those CEO's who have screwed the company over the last few decades. Obama and his team better damn well get another economic stimulus package through Congress to help these new unemployed workers along with the rest of us still looking for work. So far I'm not impressed with Obama's economic vision.

[ClarkUSA]

8. I never doubted that Obama naysayers like Krugman and Limbaugh would be proved wrong.

Thanks for the story. :)

[4lbs]

9. Even Krugman's been forced to admit that things aren't as bad as they could have been.

In an article published last week, he acknowledged that there was a good chance the recession would bottom out and start to recover by the end of the year. He also said there was a decent chance that the US would experience actual positive GDP growth in the last quarter of the year.

[ClarkUSA]

15. Thanks for the reminder. I guess he had to, or else he'd really have looked like a crank.

It's amazing how things can change in the month from his April "Obama Is Wrong" Newsweek cover until his 'bout-face last week. :eyes:


I'm just glad he isn't on Team O's economic team.

[Jennicut]

17. I have nothing against Krugman

but his dire predictions were off base. At least he can realize that.

[girl gone mad]

27. So you think the crisis is over, everything's back to normal..

maybe because the stock market has gone up a bit and the banks managed to pawn off their bad assets onto the taxpayers while using TARP money to re-inflate the commodities bubble so they could make more profits at the expense of American jobs. Goody. So all of the sleazy executives who took us off of a cliff get to keep their bonuses and the banks' bondholders who should be getting haircuts instead get paid in full.

Well, in the real world, things are looking a bit more grim these days.

http://3.bp.blogspot.com/_FM71j6-VkNE/Shbg2neUZdI/AAAAAAAACwc/WKBYGJFFI3w/s400/2s10s+5.22.09.jpg

http://4.bp.blogspot.com/_ABMXXdDurHs/SfCbs9zaEqI/AAAAAAAAAiE/XHpn0AF105o/s320/DIF+reserve+ratio+-+Mish.jpg

[ClarkUSA]

38. Only a madwoman would even suggest such a thing. But their doomsday predictions were for naught.

As were those of many 24/7 naysayers here. The economy has stopped its freefall and has "stabilized" (to quote the backpeddling Krugman). :)

[kenfrequed]

44. Uhm

But direct relief for those losing their homes, which was supposedly the root of this problem, has not been provided. Moreover the job losses that occurred during Bush's administration and those that occurred prior to any presidential actions have been taken by the Obama administration have not recovered and are merely not bleeding out as much.

There still is no recovery and the banks assets beign slightly more stable is only based on the influx of federal money. They are still not lending money and they still hold onto tons of toxic assets both in terms of mortgages and in deriviatives.

For there to be a recovery the loans have to be refinanced at a rate that the average worker can actually make payments on. I suppose we could just try to skip this step but if the market continues to flood with homes and the banks won't loan any money to purchase them then what do you think the result will be?

Bailing out the banks alone will not solve any of the underlying problems that created this bubble. Smart economists have been warning about a derivative crash for 15 years.

Maybe lets save the game of 'Cheerleaders and curmudgeons' for later when we actually get to a productive economy?

[ClarkUSA]

47. If you call and speak to a HOPE counselor, you'll find that qualified homeowners have been helped.

Go for it. Link: http://makinghomeaffordable.gov/

My point stands: Krugman and Limbaugh doomsday pronouncements were wrong. Your strawman arguments notwithstanding, the economy has stopped its freefall and is indeed stabilizing.

[kenfrequed]

55. Point??

Uhm you do realize that merging Krugman and limbaugh, argumentatively speaking is, in terms of logical fallacies, closer to the classical definition of a strawman than anythin I have typed.

You have said nothing to back up your arguments and the fire breathing lizard that scrolls (scrolled?) across the bottom of your posts takes up as much space as most of your argumentation.


Do you even know what a strawman is?

[ClarkUSA]

57. You're not interested in my point(s) so much as you want to argue ad nauseum.

You have nothing but baseless rhetoric to offer whereas I have responded with links galore to refute your plethora of red herrings and strawman arguments. As for Krugman and Limbaugh being two sides of the same doomsday coin, that's a fact you can discern from reading through the archives here. But I doubt you're interested.

[depakid]

32. Stay tuned

and stay "cheery," because nothing's be "proven" on way or another- and the downside risk is even greater should the non-panderers worries manifest down the line.

[ClarkUSA]

39. No ones' denying there's difficult times ahead, but their doomsday predictions were obviously wrong.

[kenfrequed]

45. And that rumbling sound? The smoke?

Nothing to worry about at all say the people of pompei. Honestly straw manning the criticism of this policy and the possible damage it could do, a policy in general followed by Bush as well, as 'Doomsday scenarios' is intellectually dishonest.

Then you simply wave a magic wand when you suggest that anything in regards to these critiques and the predicted outcomes is 'obviously wrong' which seems a completely absurd statement.

I think whatever your opinion that 'wait and see' would be a more intelligent statement.

[ClarkUSA]

49. My point stands: Krugman and Limbaugh doomsday pronouncements were wrong.

Your strawman arguments notwithstanding, the economy has stopped its freefall and is indeed stabilizing.

[Political Heretic]

34. "Proven Wrong" if you're a wall street exec.

Nice bullshit equating Krugman and Limbaugh in the same breath, though.

[ClarkUSA]

40. "Proven wrong" for the millions whose jobs have been saved or created by the Recovery Act

Link: http://my.barackobama.com/page/content/foundationforchange

[kenfrequed]

46. Which jobs?

Point out how this policy saved jobs and which jobs were saved. Show me the numbers. Pretend that you actually have to demonstrate how the economy has been saved for the average worker and not just Wall Street execs.

I mean when he thoroughly modified his program and took off most of the stipulations they suddenly were ecstatic about it. I mean who wouldn't want an instant bail out? I am driven to total confidence that the happiness of the people that happily destroyed the economy will somehow work out well for everyone else.

[brentspeak]

51. Good question

Highly unlikely that the previous poster knows the answer.

[ClarkUSA]

53. Yeah, you love baseless op-ed rhetoric masquerading as fact, don't you? Can't wait for your next OP

[ClarkUSA]

52. I gave you a link, now do the work to answer your own questions. I'll give you a head start (link->)

Link: http://www.google.com/search?client=safari&rls=en&q=stimulus+jobs&ie=UTF-8&oe=UTF-8

Your red herrings and strawman arguments are proof you are flailing to find a foothold but you can't because moving the goalposts and inserting personal opinion is no substitute for the facts, which I've given you. Just because you haven't a clue as to what's happening on the ground doesn't mean Pres. Obama's economic policy decisions haven't been working, as Paul "Obama Is Wrong" Krugman has finally had to admit.

My original point stands: both Krugman and Limbaugh's doomsday predictions were wrong. I can't help it if you're more interested in opinion-based rhetoric than figuring out the facts about this issue. Now go look for answers instead of asking me to do it for you because you just want to argue from a personal POV. I'm not interested in helping you grind your axe.

[kenfrequed]

59. Logic lessons:

Red Herring- basically an unrelated argument or bit of information not related to the matter at hand. Oddly I find the derivatives, unemployment rate, and falling mortgages are all germaine to the argument.

Straw Man-- Building a characterization and exagerration of some point the opposition has made and (when it actually even portrays the opponents arguments) drawing only the weakest arguments (mixed in with distortions) and finally beating up that characterization and declaring victory.

I ask questions you cannot answer.
I have called you out for falsely lumping unrelated opinions and completely oppositional economic opinions together.

Your response has been a misunderstanding of basic terms of logical fallacy and a poorly worded google websearch that only seemed to find projections and speeches.

[ClarkUSA]

60. ...

:boring:

[kenfrequed]

61. Feh

Given the depth and consideration of your arguments I would say you have slept through quite a bit.

[ClarkUSA]

62. ...

:nopity:

[Political Heretic]

64. The "Recovery Act" was not what Krugman took issue with. And unemployment is still rising

And more jobs are being lost than are being created, to this very date. But FWIW I was strongly supportive of the Recovery Act. You can verify that for yourself.

[ClarkUSA]

66. He wanted it to be much bigger plan, as I recall.

BTW, unemployment is a lagging indicator which will likely continue to raise for at least another six months (peaking later this year) before easing off next year.

[TankLV]

73. That does take some art, doesn't it!

says more about the poster and his knowledge of the subject...

[ClarkUSA]

75. Your drive-by opinion-based rhetoric is duly noted.

Do I smell sour grapes? :wtf:

[kenfrequed]

43. uhm huh?

Lumping Krugman with Limbaugh indicates you know nothing about the economic arguments that were presented agaisnt the current bail out system.

It would be equivalent to saying "Yeah!!! Presidents Obama and Bush are both being proven right!"

Rather than framing this as naysayers do yourself a favor and do a bit more research into what is being done here.

[ClarkUSA]

54. You're entitled to your own opinion but not your own facts.

The facts: both Krugman's and Limbaugh's anti-Obama doomsday economic predictions were proven wrong. The economy has stopped its free fall and is now stabilizing according to most credible analysts, even the Nobel-Prize winning one who claimed "Obama Is Wrong" five weeks ago.

"... do a bit more research into what is being done here."

Take your own advice: http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=132&topic_id=8444220&mesg_id=8445927

[kenfrequed]

56. So you deny that...

You are lumping a right wing ideolouge in with a progressive and liberal economist? Or are you denying that you haven't actually read why Krugman believes that economy may be in danger? Or are you denying that it is in danger? Are you also denying the joblessness rate?

Oh and research usually involves cracking a book occasionally not just posting a link on a message board from another string that you authored that references a google search.

[ClarkUSA]

58. ...

:nopity:

[paulk]

67. LOL

if that's the best you can do, you lose.

[ClarkUSA]

68. ...

:smoke:

[paulk]

69. unless, of course, your goal is to distract and disrupt

any thread that is remotely critical of President Obama.

Do you get paid to do this?

[ClarkUSA]

74. Are you a writer of pulp fiction? Dollar-store mystery novels, perhaps?

:tinfoilhat:

[Occam Bandage]

11. He's right. And Krugman's been backing off his most dire claims recently.

Glad Obama listened to responsible economists, and not alarmist MSM pundits.

[Larkspur]

12. And Obama has been telling GM workers going on the unemployment line that they are

making sacrifices to the future. Those sacrifices don't put food on the table or pay the mortgage. What's Obama's plan to help workers, who are not getting the golden parachute that GM CEO's get when they get laid off?

[Occam Bandage]

13. Hm, other than the tens of billions of dollars of free money he gave GM to try to keep it afloat?

GM is in bankruptcy. Their business model was broken. When businesses go into bankruptcy people lose their jobs. I lost my job when Northwest Airlines went into bankruptcy. It happens.

[Larkspur]

14. So it's OK for Geithner and Summers to make sure that Goldman Sachs

gets money to stay afloat, money that they will not have to pay back, but screw the American worker?

Obama's bank bailout plan is a farce that helps keep the fat cats on Wall Street, who screwed our economy, in power. What Krugman, Black, et al were advocating was restructuring the financial system, a la FDR style, so that our economy is not captive to the Robber Barons from Wall Street. Our entire economy needs to be restructured because right now it's too damn dependent on financial services, which can not provide enough jobs for all Americans.

[Occam Bandage]

16. Goldman Sachs is currently repaying its TARP money. Bad example.

GM's restructuring will cause it to lose jobs, yes. It will lose far fewer jobs than if the bankruptcy was not being shepherded by Obama. When Northwest went under, we lost tens of thousands of jobs (including mine), the mechanics' union was busted for good, and more or less everyone got their pay and benefits cut in half. GM's fate will be better, but you cannot possibly demand Obama single-handedly protect GM from the natural result of thirty years of bad business practices.

It's noteworthy that your complaints are not about the effectiveness of Obama's recovery package--even Krugman has recently admitted that things are getting better faster than anyone expected. The complaints are more or less that rich people are rich. While a healthy heaping of class warfare is admirable, reordering America's class structure was never Obama's goal. He's a Democrat, not a Communist.

(And had Obama nationalized the banks, you would today be correctly complaining that Obama forced the taxpayer to take on 100% of the debt of banks, and that did nothing to fix the economy.)

[Larkspur]

18. Goldman Sachs is only repaying it because they got caught

they were getting money via AIG and another source, not directly from the government. If they had not gotten caught and exposed in the press, they would have just pocketed the money. Both Geithner and Summers are former Goldman Sachs employees, so I'm very suspicious of them. Conflicts of interest is the first thing that comes to mind when I think of Geithner, Summers and the bank bailout.

Krugman sees the economic troubles leveling off for now, but other reports say that unemployment will hit double digits by end of the year, if not before. Those 2 things do not make an economic recovery. As long as millions are unemployed, the economic recovery will be handicapped at best.

The real question will be, do we have an economic recovery or is Obama and his team just reinflating the previous bubbles? That's what I see Obama's team doing, at least in the short term. Anyway, all the criticism Obama's team has received from the Left has been good for our country and in the long run for Obama's Admin. Power corrupts and Obama is not immune to that force. I hope Elizabeth Warren, Krugman et al, keep Obama and definitely Geithner and Summers on their toes.

If Obama had nationlized the banks, like FDR DID, I would have been for it. FDR got it to work, so why wouldn't Obama? Now will Geithner and Summers finally agree to regulate credit default swaps, which they pooed pooed under the Clinton Admin? If they don't, they they will be just reinflating the previous bubbles.

[ficus1]

24. Neither Geithner nor Summers are former GS employees

But this is America, everyone's an expert on every subject, so please continue your trenchant economic analysis.

[Political Heretic]

36. mmYou are techincally correct, however Summers was paid substantial amounts of money by GS

[Larkspur]

63. True, but Robert Rubin, who chaired Sachs for 26 years was mentor

to both Summers and Geithner, so it's hard to tell the difference, and Sachs via Rubin and his minions made sure that there was
No Team of Rivals on Economics: Bob Rubin Acolytes and Goldman Sachs Alums Dominate Obama Team and Have Blocked Alternative Views from Entering White House Ranks

[grantcart]

20. So much for Krugman going on and on about Obama creating a

"Japanese decade" That was one of the shortest decades in history. Funny how some prominent Krugman apologists have gone silent after posting his hour by hour criticisms a few months ago.

[Telly Savalas]

22. I believe the Treasury Department is backing off on its plans to implement PPIP

The fact that they don't think it's needed anymore suggests that like Krugman they too are becoming more optimistic about the banking situation than they were a couple of months ago.

I'm not sure of what to make of the quick change from "OMFG!!!11 If you don't give us banks hundreds of billions of dollars or WE"RE ALL GOING TO DIE!!!1111" to "everything's hunky-dory". Maybe my bullshit detector needs calibrating, but it's reading in the yellow on this one.

[Zynx]

23. The financial crisis is not as bad as it was in October.

In October, major banks either did fail or nearly fail. We lost National City, WaMu, and Wachovia in a very short period and came close to losing others. The government pressured them into mergers rather than let them fail, but there was clearly serious damage done to the financial system.

[Political Heretic]

65. Correction: the fiancial crisis is more sufficiently masked and buried than it was in October

So now Wall Street with the dick-sucking support of Washington can go back to reinflating the same failed bubble that brought us here in the first place so that our children can experience its collapse and likely implosion.

[DrToast]

28. It's not that confusing...

PPIP was setup because it was believed that banks couldn't get capital through private sources. As the economic situation has improved the last few months and the capital markets are functioning again, the PPIP has become unnecessary.

[girl gone mad]

29. Your statement is completely inaccurate.

You are trying to spin what is essentially a failure of the administration's economic team as a success story. Treasury and the FDIC got this one very wrong.

Here's part of the real story on PPIP for anyone who cares to know:

http://www.housingwire.com/2009/05/29/questions-of-faith-for-legacy-loans-program/">Questions of Faith for Legacy Loans Program

The Legacy Loans Program was meant to help the banks get toxic assets off their books by providing generous incentives to investors who bought the toxic assets. However, it looks like the plan is close to being scratched due to criticism and fear that the public will not like the government helping investors. Diana Golobay from HousingWire reports on the latest developments of this story.

The Federal Deposit Insurance Corp. (FDIC), which is designing the Legacy Loans Program, is receiving concerns from both potential buyers and potential sellers of the loans that the rules of the program might change as public and political views of Wall Street deteriorate further.

The Legacy Loans Program, a big part of the Public-Private Investment Program (PPIP) designed to attract private capital to buy up toxic — or so-called “legacy” — loans may even be closed, reports say, as regulators shuffle programs to find the right balance.

Much like the banks that found themselves the targets of public criticism and tight regulatory oversight for taking Treasury Department funds through the Troubled Asset Relief Program, prospective participants in the Legacy Loans Program fear they might be subject to changing regulations and heightened criticism.

In response, the FDIC may scale back on the program or put it on the back burner altogether, unnamed sources told the Wall Street Journal.

The issue of toxic loans is far from averted by the news, however, and some banks are getting creative with alternatives. Bank lobbying groups asked the FDIC to allow banks to bid on the same toxic loans they put up for sale, sources told the WSJ. Such a move, the trade groups argue, would give banks an incentive to sell assets at low prices or even at losses, to keep capital flowing between banks, remove toxic assets off their balance sheets and encourage lending.

Sort of puts a different perspective on things to know that even now banks are lobbying Sheila Bair to let them bid on their own toxic assets, doesn't it?

[DrToast]

30. Read the articles this "report" is based on

Banks have been able to raise close to $40 billion in new capital in the second quarter, stabilizing their financial position.

At a Wednesday news conference to discuss the condition of the banking industry, FDIC Chairman Sheila Bair hinted at the program's uncertain future, without providing details. "There are a couple of factors that are still at play here as we try and develop this structure," Ms. Bair said.

She added: "Banks have been able to raise a lot of new capital even before taking more aggressive steps to cleanse their balance sheets, so the incentives to sell may be less."

[cooolandrew]

21. I think so much cynicism was built up in the last 8 years when we meet a guy of good intent it's >

almost hard to believe but believe we must. Good things are still yet to come. We're just in the midst of a chess game played to perfection. The light is still at the end of the tunnel we just gotta keep heading for it.

[ShortnFiery]

25. "We're just in the midst of a chess game played to perfection."

Why am I envisioning one of my favorite movie scenes?

"Click your ruby slippers three times and say 'There's no place like home.'"



This is a JOBLESS recovery.

We have no semblance of a manufacturing base.

We're slouching toward becoming a Third World economy.

Our future?

Think RUSSIA, i.e., don't forget we'll always maintain a kick-ass military.

[depakid]

31. The term for what the administration's doing is called "muddling through"

And Krugman's not the only preeminent economist who thinks that was not the best approach.

byw: Citi? No longer on the Dow.

[Political Heretic]

33. "the outcomes have actually be pretty favorable" - what a laugh.

It pains me so greatly that people can't seem to open their eyes and get what is happening.

The solution to the meltdown of the financial sector has been to "reboot" the status quo, reinflate the same bubble, leave the same players in place, and reward those who (likely criminally) failed. In addition to the 1 trillion dollars of bailout money commonly discussed, over 2 trillion more has been pumped out through the fed and handed to wall street with almost no oversight or accountability for its use.

When asked for a list of companies that have received this money, the government declines to disclose. The government creates a "stress test" to assess the financial sector, then allows the VERY BANKS BEING ASSESSED TO PARTICIPATE IN THERE OWN ASSESSMENT. I shit you not. The original "stress test" results of citi bank showed horrible insolvency and massive debt, then citi lobbyed to downsize those numbers, AND THE GOVERNMENT DID IT. It's nothing but insider baseball bullshit.

Obama and his team's fundamental mistake is thinking that the goal of a response to this financial disaster should be to "reboot" things, reinflate the same bubble in hopes to return to the Wall Street Halcyon days of the 90s - a time period in which Wall Street enjoyed record profits while real wages for working Americans and the bulk of the middle class stagnated or declined (visit the Economic Policy Institute or google "State of Working America Report" to look at the historical wage and median income data)

All we have done with this handling of the financial crisis is put a bandaid on a broken system and punt its broken failure to our children. This was the biggest warning we could have ever asked for, and instead of actually doing something about it, we simply kept the same corrupt, broken mess of a system thoroughly in tact so that when it goes belly up again (and it most certainly will) we really will be in another depression - at best.

[chimpymustgo]

41. You have summed it up. The key issue is the lack of jobs. The fat cats stay fat. Middle America

moves toward breadlines. Both Eliot Spitzer, Michael Moore and other demons like Krugman have pointed out the need to create jobs with specific green tech programs. MM suggests building a nationwide high-speed train system. JOBS, INFRASTRUCTURE, AND GREEN.

[paulk]

35. it's kind of early to make that judgment

Krugman saw this crisis as an opportunity to make some fundamental change, the Obama administration chose to support the status quo.

We'll never know if the change that Krugman called for would have been the better way to go.

I do think that the "hurrahs" for the success of Obama's handling of the crisis are premature - people are still losing their homes at record rates and there are still no jobs out here in the real world -

[Political Heretic]

37. Krugman saw this crisis as an opportunity.. for change; Obama chose to support the status quo

That's exactly right.

[ClarkUSA]

42. Nothing is impossible for those who do not have to do it.

[Name removed]

48. Deleted sub-thread

Sub-thread removed by moderator. Click here to review the message board rules.

[jillan]

50. I am a huge Jared Bernstein fan - but - I also am one of Krugman...

Time will tell who is right.

[w4rma]

70. Krugman was right on target. Obama's pro-Wall Street policies have been a disaster.

A horrible and terrible disaster, actually. Obama's economic team embraced trickle down economics at it's absolute worst. :( It's most likely that they hastened our descent to third world status.

Wall Street already sucked Americans dry. Now, Obama's economic team has allowed Wall Street to suck the U.S. government's treasury dry. Next step is for Wall Street to leave the nation, all together and invest in other nations (or just buy up everything here and rule).

[TankLV]

71. I'd trust a NOBEL LAUREAT with a PROVEN TRACK RECORD

and that means KRUGMAN - everytime...

[ClarkUSA]

76. Trust him with what? Do you think a Nobel Prize confers infallibility?

Even after Bush became president, it's clear that Krugman saw Bush's deceptions as more joke than threat. In particular, Krugman, like many people outside and inside Washington, didn't believe that the Bush administration would persevere with the tax cut in the face of a deepening slump. The interesting thing about Krugman is that he was a mainstream neoclassical economist who was moderately liberal as a citizen, but tended to look at politics as an illegitimate distortion of the perfection of the market economy. He viewed the left and the right as symmetrical evils. Krugman has now discovered power.

The most serious error was in a column written in July 2002 about Bush's dealings with the Texas Rangers, of which he became a part-owner in 1989. It's well known that Bush put $606,000 into the syndicate that bought the Rangers in 1989, about 2 percent of the total cost. When the deal was initialized that same year and Bush became the team's general manager, the syndicate awarded their well-connected partner an additional 10 percent stake, gratis. When the team was sold in 1998, Bush earned $14.9 million on his original investment. But Krugman went further, charging that Bush's extra return was "a 12-million dollar gift" to "a sitting governor," when in fact the gift had been awarded years before Bush's election as governor in 1994. Krugman later admitted the error--on his Web site, but not in the Times.

In a column about Army Secretary Thomas White, Krugman, citing a report by reporter Jason Leopold in the online magazine Salon, wrote that shortly after White knew of Enron's impending losses, he wrote an email to another executive "Close a bigger deal. Hide the loss before the 1Q." White, charged Krugman, was an "evildoer." But two weeks later, after White told the Times he couldn't "recall" writing the email in question, Salon took the story off their site, and after re-examining Leopold's evidence, neither Salon nor the Times could authenticate it. In his next column, Krugman apologized for the mistake. But not before he was roundly pilloried for repeating the quote, even more so than Salon for printing it. "Krugman Comes Clean" wrote Andrew Sullivan on his Web site. Check the archives. Both columns involved major errors.

Here are economists, financial experts, and top political writers who fault Krugman's words:

"Paul Krugman is Wrong About Securitization"
http://www.ritholtz.com/blog/2009/03/krugman-is-wrong-about-securitization/

"Krugman Is Wrong"
http://www.huffingtonpost.com/hale-stewart/krugman-is-wrong_b_180340.html

"I Think Paul Krugman Is Wrong"
http://delong.typepad.com/sdj/2009/03/i-think-paul-krugman-is-wrong.html

"I BELIEVE PROFESSOR KRUGMAN IS WRONG ABOUT CLIMATE CHANGE AND CHINA"
http://theamericanscene.com/2009/05/15/i-believe-professor-krugman-is-wrong-about-climate-change-and-china

"Not sure exactly which Chinese people Paul Krugman met..."
http://jamesfallows.theatlantic.com/archives/2009/05/not_sure_exactly_who_is_talkin.php

"KRUGMAN VS. KUTTNER- OF ECONOMISTS AND LIBERALS"
http://www.pkarchive.org/others/29-cnt.html

"Paul Krugman's elementary mistakes on economics":
http://himaginary.blogspot.com/2009/05/paul-krugmans-elementary-mistakes-on.html

"Krugman is Wrong, the Chinese are not Fools"
http://www.prospect.org/csnc/blogs/beat_the_press_archive?month=04&year=2009&base_name=krugman_is_wrong_the_chinese_a

"Why Krugman Is Wrong"
http://andrewsullivan.theatlantic.com/the_daily_dish/2008/05/why-krugman-is.html