Paul Krugman is Confused

Well, Paul Krugman is at it again. The man is about as sterling an example of the danger of assuming that fame equals intelligence as I can think of.
I happen to agree with his argument that the comparison of government to household spending is nonsensical, but the ways he comes up with to defend that position vary from insane to comical. The only argument that is actually needed, of course, is that a family can’t print money, but Krugman can’t ever seem to let it go with that.

Today he argues the relationship between government spending and jobs and, as usual when he ventures into that territory, he trips over his tongue and falls flat on his face.

“When a family tightens its belt it doesn’t put itself out of a job,” he says. Well, no, but then neither does a government. The government keeps right on trucking. He goes on to say that, “When a government tightens its belt in a depressed economy, it puts lots of people out of jobs.” Which may be true, but when families tighten their belts they also put lots of people out of jobs, namely the people they have been buying from.

So as usual, instead of proving his point with his analogy, Paul Krugman manages to actually disprove it. On the surface Paul Krugman is a deep thinker, but way down deep he is a really shallow thinker. He’s probably picking Harvard to win in March Madness.