Subject: Deficits Don’t Matter
Paul Krugman was awarded the Nobel Prize for economics this year. In his latest column he decries naysayers such as Curt, myself and Aaron as having it all wrong. Thoughts?
FROM: Curt Doolittle
To: Kyle; Debate This
What he means, and there is some possibility that this is correct, that in the short term, we can create a large amount of “noise” that will direct the ‘market’, and that the ‘error’ in this direction is simply a correction of the previous errors. The counter is that these ‘corrections’ amplify the previous errors, at least over time. And the supposition one employs in such thinking, is that we produce some sort of normative level of production so that we’re ‘losing’ productivity from some hypothetic norm we can somehow perceive when we’re in a depression, rather than that the normative productive capacity of man is say, farming, or some mixture of that and light manufacturing, and that at any given time we’re in a period of productive capacity that’s higher simply because of innovation and rates of movement of certain issues like distribution of technology and demographics. It’s the idea that civilization marches ever upward and onward, rather than that it’s a fragile stream held together by populations and trade routes.
In other words, he as a sort of micro-view of macro-economics, born of analyzing data over a period of time insufficient to convey what is truly causal. Whereas behaviorists and philosophers, start with human behavior (of different kinds) and use data and that understanding of human behavior to make such assumptions. So he has a view. But it is a sort of odd view of history. As if intentionally seen through a myopic lens.
He uses a particular view of the DATA to obtain that reasoning. but that reasoning, that analysis of the data, is based upon assumptions of human nature, and the power of money to create noise, incentives, or whatever that is something we don’t know, but certain economists would like to figure out. The view of the Krugman’s of the world is that everyone works for the benefit of everyone else, the government has the right to make that choice for people, and if you manipulate the money supply carefully enough, you can in fact manage the people. The view that ‘we’ have, the people on this list, the people who are conservative (and most historians for that matter) is that money is an information system that supplies partial information, and that information is effectively DATA, in support of some set of general theories, what we call myths, that a populace operates under. That money is data, not theory. And that incorrect data (inflationary money) supplies people with that information.
The difference here is that the Krugman universe thinks that people will learn if given resources. The conservative universe things that people must learn in order to manage resources for mutual benefit. Evidence, in all of history, appears to be on our side, rather than his.
Now, the issue he might argue, as did Keynes, is that the time frames that such things play out over are immaterial to the people who live in the time period where the change occurs. (in the long run we’re all dead), fails to understand that the very reason that we forgo opportunities in life, that we form societies, is so that we can achieve a longer term end, by our myths.Now Krugman is part of the diasporic Jewish culture that is NOT about building political myths. It is a minority “slave or subject’ philosophy of people who do not have real political power (violence and land). And so My view is that he is simply using his ‘population index” within his metaphysical mythos, thinking he has solved some sort of problem, when in fact he simply has a different preference.
If we do not organize into groups, and we are “all the same’ then we must in fact become the same in the end, and as the same, we will live in poverty. Or, that somehow there is some possibly known difference in incomes that is a disparity possible to resolve by intervention, rather than that concentration of capital is a destructive force for a society beyond X such level: concerns about minima and maxima that drive very different conclusions about the world we live in.
But, and here is the crux of the issue, which is political control: of course you only pursue that logic if you are a Christian, a Muslim, a Chinese, Hindu, who is actually in control of land the security of which, and the respect for property of which is paid for by risking one’s life in violence, and most importantly, when the outcome of taking that risk is unknown to you: you take such a serious risk knowing only that it MIGHT benefit you, but will benefit others.
In other words, Krugman’s philosophy is egalitarian cooperation enforced by law and monetary policy. It is the philosophy of the migratory city dweller who has no interest in supporting the methods traditions and behaviors that create the very motivation behind which comes the self-sacrifice of the heroic mythos, that is the necessary mythos of any land holding, resource-controlling, politically controlling, group, who plans and works together for the future. Instead, it is the philosophy of a day trader. Getting benefit at the expense of those who came before you.So, it is very easy to think that this is simply a technical problem, when in fact, data is only meaningful in the sense that it supports or falsifies a theory. In any theory of physical things, time and process are constant. But in human endeavors, that data that we collect applies not to one theory, but to an overlapping sequence of theories, depending upon how many people you are considering, and over what period of time. A few today, or may at some distant point in the future. And that data has different meaning depending upon how you view basic human nature, wants and needs.
The attempt to make economics sound like science, in order to justify it’s necessarily philosophical nature using quantitative measures, means that we have, as did Keynes, make generalized assumptions that some people, many of us, believe not only are not true, but CANNOT be true. Or it means you simply don’t care about the sacrifices the people made before you. And you should not make them. Or you should not make those sacrifices because you can get away with it. Or because it is counter to your sub-group’s metaphysics, habits, traditions or goals.The philosophy of the slave is the philosophy of the weak. He is using the philosophy of the weak, without understanding that the system he is manipulating was created by the philosophy of the strong, by violence, mythology, and the cooperation of large groups, toward a common goal from which each anticipates taking only indirect benefit, and cannot exist without it. He is using city dweller philosophy and the fact that there is so much activity and capital in cities that the individual cannot perceive it, while failing to understand that no city exists without farmers who are soldiers to defend it. And that there are no soldiers without farmers. Soldiers and farmers are the same thing. There are warriors in hunter gatherer societies, there are raiders in tribal and peasant societies, but not soldiers. Because to soldiers there is a concept of duty which is impossible to detach from land or Polis (city). That duty created by myth. The city dweller, and in particular, the itinerant city dweller, or the diasporic city dweller, actually sees the moral code, the social order, the mythology and the traditions as an impediment to his groups success, because as a minority, he must pay, at least by forgone opportunity, the cost of keeping the majority in power.
Now what you find when you box someone into a corner on this line of thinking, is either “it doesn’t matter”, by which they mean, they don’t care about people before or after their lifetimes, (which again invalidates the very structure of civilization), or that they *believe that we all can live equally under a managed economy* (with themselves as the management). And whether these people understand it or not, we are all equal only in slavery and poverty. This is just slave philosophy writ large.
I could go on and on about this but this is actually the problem: attempting to make something scientific which is not, something quantitative that is qualitative, and something apolitical, which requires for it’s very existence, political theory by which to analyze any captured quantitative, apolitical, and apparently-scientific data.
Krugman’s only interest is redistribution and reducing income differences. He simply does not acknowledge the long run impact, to the social order itself, and in fact, not only does not care, but desires the long run impact, in what I believe is probably his subconscious mythology.