printNew York Times columnist Paul Krugman expresses the monetary policy of the US government, both Obama and his predecessor. If anyone doubts how progressive the US is, listen to Krugman (via Peter Schiff) berate “the monetary priggishness of the German heavyweights in the European Union, who are ‘foolishly’ seeking to prevent inflation [in the Greek debt crisis] and impose fiscal discipline.”
Krugman argues “that the best solution for Athens would be to simply inflate away its debt burden with printing press money. His theoretical justification is put forward in a familiar Keynesian recipe: deficit spending leads to inflation and growth, which leads to greater employment and rising GDP, which makes debt payments much easier to bear in relative terms. He laments that Greece does not control its own currency and is therefore unable to pursue such a policy on its own accord. He implores U.S. policy makers, who do control their own monetary policy, to take heed of the danger and avoid such a course.
In simple terms, Krugman believes that inflation is the best cure for burdensome debt problems.” …
Peter Schiff, always worth reading.
Update I (April 12): Keynes’s theory is not economics, but politics. He came to dominate political platforms by opposing free trade, balanced budgets and the gold standards, and by proposing economic management and interventionism through busting the budget. His devotees are indeed pimps to the political class, with no fealty to or familiarity with the laws of economics.
Update II (April 13): WHEN KEYNESIANS PREACH TO COMMONERS. “Fed’s Bernanke stresses need for financial literacy”:
“Many American families are struggling in the aftermath of the financial crisis, which reinforces the need for reliable and useful information to facilitate good financial choices,” he said in remarks prepared for delivery to the National Bankers Association Foundation.
If applied by the Little Man, literacy such as the Chairman’s would imply endless spending financed by the counterfeiting of funny money.
Krugman is the establishment’s economist. He makes a case for what best benefits the government, not necessarily the populace, on the theory that what’s good for the elites is good for the rest of us. He doesn’t consider that their goals & ours are completely different.
“Krugman believes that inflation is the best cure for burdensome debt problems.”
Krugboy is basically right you can get rid of debt through inflation
The part Krugboy fails to mention is you will destroy the Country’s economy if implement a policy of ever increasing inflation
http://schiffforsenate.com/
Krugman is on the right track. All a country has to do is inflate their currency until the debt is absorbed. Of course your economy becomes a shambles. A Big Mac and a Coke will cost a month’s pay and a person’s life savings would be needed to buy the kids shoes for school. Yes inflation is the cure all right. It’s the cure for a sane and effective fiscal policy.
SOCIALISM NEVER FAILS (of course) – it was just never implemented correctly. The stimulus just needed more stimulus. The answer to all government failures is even more government. Boy, my name is Krugman and I am really, really, really, very, very, very, smart. Heck – make that brilliant!
P.S. Why worry about inflation – all you need are wage and price controls (and maybe some rationing).
Krugman is really just a political hack without an original economic thought in his (brainless) head. It isn’t the fact that he is blatantly biased in his views, it is that his views have been shown, historically, that the pounding inflation caused by his blithely stated ‘fixes’ of a Greek-type economy, tends to destroy much more than it fixes.
I believe the time has come for Americans to start investing in hedge funds.
I wonder if Krugman can spell “Weimar Republic”. Or maybe “Zimbabwe”.
Is it monopoly money?
Or is it Monopoly money?
Either way we can print some more.