April 13, 2013

Saturday Morning Essay: Mr. Krugman's Science, Part 6

One of my purposes in attempting to demonstrate the pro-status quo bias of the fearless Liberal, Paul Krugman, ace economist for a great metropolitan newspaper, is to encourage fellow hooper Bob Somerby, who mans the keyboard at The Daily Howler, to include Krugman in his daily thrashing of columnists at The New York Times and the Washington Post.  Bob does this exceedingly well, in a meticulous, recursive, penetrating way. 

I take it on faith that Bob exempts Krugman for reasons which are sufficient to Mr. Somerby, and that his accolades for Mr. Krugman are sincere.  However, I can't help feeling that Bob is himself a liberal who has been taken in by Krugman's self-promotion as a "Liberal" with a "Conscience" who fights for the little guy on Social Security and Medicare et cetera, and that without him we would be exposed to the slings and arrows of outrageous Republicanism.

This I doubt.  I was gratified to see that Mike Whitney, who often writes about economics for Counterpunch, has come over to my way of seeing things; that is, of seeing through Mr. Krugman.  In a recent, hilarious account of the David Stockman vs. Paul Krugman "debate" on "This Week" Mr. Whitney had this to say: 

 But while Stockman’s editorial has broad popular appeal, it’s come under ferocious attack by the liberal commentariat, who’ve savaged Stockman on issues that are largely meaningless to the average working stiff.  Obama’s primary apologist, Paul Krugman, has been leading the jihad against Stockman; pounding away at his economic theories while dismissing him  as a “cranky old man”. 
 Whitney narrates the play-by-play as he continues:

Krugman, one last time:
“This isn’t about machinery, it’s about people and visions. We have two parties who have fundamentally different visions of what America should be. We have Democrats, who want the expansion of the safety net and have gotten it in Obamacare. They want it to be even more. And we have Republicans that want to dismantle a lot of the legacy of the Great Society and the New Deal.”
This is such nonsense. What difference have we seen under the Dems?
Zilch. The drones, the wars, civil liberties, regulation, spying, Guantanamo; you name it, it hasn’t changed a bit. Same shit, different leader.
Obama claims he can kill a US citizen without charges or trial, but Krugman maintains the Democrats have “fundamentally different vision of what America should be.”
Uh huh.
Finally, Stockman goes in for the kill.
“The (Democrats) don’t stand for anything.
They don’t believe in anything. Why do we still have Too Big To Fail? We allegedly had a heart attack, the banks are bigger than ever. Why don’t Democrats do something to break them up and cut Wall Street down to size?”
And that’s how it ended, with Krugman backing up against the ropes while Stockman delivered one haymaker after another like a windmill spinning in a gale-storm.
That's great stuff.  The animus against Mr. Krugman is pretty apparent from the imagery Mike Whitney uses: he imagines David Stockman simply beating the shit out of  Krugman once and for all.
The essential point that I think people miss about Mr. Krugman's science is that Krugman deploys his science (private joke: in the same sense that Percy produced science) as a political operative who carries water for the Democratic Party, and for that wing of the Party known as the Democratic Leadership Council (the DLC), the Clintonian, Robert Rubin, Larry Summers, sell-out wing of this once-great institution who ushered in the Casino Capitalism of modern America with their relentless drive to deregulate and turn Wall Street into Vegas-on-the-Hudson.

That is what David Stockman is writing about in The Great Deformation and in his Times essay which sent Mr. Krugman into paroxysms of rage and jealousy.  Mr. Krugman wholeheartedly supports the money printing operations of the Federal Reserve, but does not bother to explain (as Stockman does) the mechanics by which the Too Big to Fail banks use this endless stream of largesse to play the stock market and become Too Bigger Even to Fail.  Stockman does explain how this comes about.  I've wondered about the differences in their approaches; does Krugman give the Fed Reserve a pass because his Princeton colleague runs the Fed? Or is it because Mr. Krugman is a pure academic who simply doesn't understand how things actually work in the business world, but pretends that he does?

Whatever the reason, the result is as Mike Whitney says: Mr. Krugman is simply an apologist for the Crony Capitalist-Hugging faction of the Democratic Party, who sheds crocodile tears for the plight of the American Commoner as his logo and cover story for self-promotion. 

Anyway, Bob: take a closer look.  You do a great job savaging the bullshitters on MSNBC.  Your series on Chris Matthews and his efforts to rewrite his history as an Iraq war hawk were priceless.  But that's the point: what happened to a genuine anti-war crusader like Phil Donahue on MSNBC?  They got rid of him.  What would happen to a New York Times columnist who wrote a sincere economics column that took on the Wall Street casino and the corruption endemic in the two-party system?  Gone in a New York Minute.  What happened to Bob Scheer, a relentlessly honest journalist who used to write for the Los Angeles Times until he became too hot to publish?  Bob Scheer, who had this to say about David Stockman, by the way:

“Why is David Stockman driving everyone crazy?…What’s all the outrage about?…
The headline on Stockman’s piece—“State-Wrecked: The Corruption of Capitalism in America”—is unquestionably accurate…..What his critics find so disturbing is not a quaint argument about the purity of monetary policy but rather the bold assertion that the overall American system of crony capitalism is in fact wrecked. This is a contention that most Americans might readily agree with in terms of their daily experience, but one that the hardly suffering pundit class would rather not contemplate…
Bernanke, who throws $85 billion a month at the bankers who caused this mess, purchasing their toxic mortgage based derivatives, is still treated with respect. But Stockman, who opposed bailing out the banks so they, like those tens of millions of foreclosed homeowners, could learn a tough love lesson in real economics, is now an object of derision…
That fiasco’s enablers—Alan Greenspan, Robert Rubin and Lawrence Summers—and the more disastrous ones to follow were crowned “The Committee to Save the World” on Time magazine’s Feb. 15, 1999, cover and are still welcomed in those polite circles where truth-teller Stockman is being treated as a pariah.”

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