I deeply respect what Paul Krugman accomplished as an economist. His work in new trade theory earned a Nobel Prize in economics. However, he has become so partisan in his editorials that he is quickly diminishing his reputation. He was on This Week with George Snuffleupagus… I mean Stephanopoulos… and he claimed that in the climate change debate “there is tremendously more money in being a skeptic than there is in being a supporter.” This ridiculous statement earned Krugman the Watts Up With That? quote of the week. I guess we can give Krugman a break since it appears climate change is not his area of expertise.
I wish that was the only problem with Krugman. Last week he wrote an article about the Tobin tax that was odd. It’s odd because for someone who is supposedly an intellectual giant in economics, he’s completely naïve when it comes to tax evasion. Greg Mankiw was left scratching his head after reading Krugman’s claim that financial transactions will not be moved if there’s a Tobin tax.
This is the danger of extreme partisanship, especially in regard to economics. Krugman is basically just endorsing whatever stupid new plan the Democrats come up with. From an economics perspective the Democrats don’t have many bright ideas right now. For Krugman I guess he’s decided to sheath the sword and just deal with the fallout. As long as the Democrats keep dreaming up new ways to tax productive people investors are going to quit investing. Until investors have confidence again the economy is going to stall. It seems like Krugman would understand this simple concept, but it appears he can’t see through his political blinders.