Oh no, Paul Krugman is at it again. In a blog post yesterday he repeats his claim that America’s post-war economic boom had nothing to do with the fact that the rest of the world was lying in ruins and that we were the only nation remaining which had production facilities which were not rubble.
His first argument for debunking that claim is that the boom was “whole generation long, from 1947 to 1973,” and we all know that rebuilding Europe only took a couple of weeks. Actually, we don’t all know that; only Paul Krugman thinks that. His span there was a whole 26 years, and fully rebuilding all of Europe in terms of manufacturing and economic strength took considerably longer than 26 years.
“The Europe-in-ruins era,” he says, “was long over while the US boom was still going strong.” Hardly true, but even if it was, that does not rule out that rebuilding Europe was what got our economic boom started.
Then he goes on to say that his argument is irrelevant anyway (which makes me wonder why he made it, then) and introduces an even more ridiculous one, saying that while, “our competitors were in ruins for a while; so were our customers,” and that therefore, “we had nobody to trade with.”
Because everybody knows that when you destroy a country’s buildings and bridges, you also destroy its monetary wealth and its natural resources as well. Actually, everyone doesn’t know that, because you don’t. Only Paul Krugman thinks that, because the country he lives in has no monetary wealth. In America if you destroy a bank you destroy the “wealth" that was in it because that wealth was nothing other than numbers in a computer. The money in the banks in Europe that we bombed into rubble was largely gold, silver and other forms of real money.
Of course we had trading partners, you silly ass. They rebuilt, did they not? What did they use for rebuilding, each other’s rubble? They rebuilt with what they bought from us, and the return trade was natural resources and raw materials.
He then argues that in the post-war years we did “very little trading” and produces a chart of exports and imports, as usual not showing real numbers but illustrating them as a percentage of GDP. Whenever an economist wants to obfuscate, he throws numbers at you as a percentage of GDP rather than using real numbers.
That cancer tumor in your brain is nothing to worry about because “it’s only 2% as large as your brain” will make a patient feel much less worried than telling him that the thing is the size of a golf ball. That’s what economists do with our deficit; the idea that it’s 8.6% of GDP is easier to swallow than knowing that it’s $1.3 trillion, or that it’s 43% of the federal budget.
I am always suspicious of overkill, such as when someone makes multiple arguments to refute one point, especially when, as Krugman does here, you toss in a few gratuitous insults at people who don't agree with you. If you know that you are right and the other person is wrong, you only need to make one argument to prove it.