Sad Things (Wonkish and Trivial), by Paul Krugman, in NY Times: I see that some people out there don’t like me. A couple of odds and ends:
John Cochrane weighs in on the Ricardian equivalence debate, sort of. I say “sort of” because he defines Ricardian equivalence as
the theorem that stimulus does not work in a well-functioning economy
which isn’t at all what it means to the rest of us, and certainly not what Ricardo meant (for the record, it’s the proposition that the timing of taxes doesn’t matter for consumer spending, so that temporary tax cuts don’t change spending).
And then he “explains” that government spending can’t increase demand because of … Say’s Law! Which, of course, Keynesian economists have never thought of.
It’s quite remarkable. And I mean that in the worst way: 80 years of hard thinking about economics, completely forgotten.
Meanwhile, Powerline attacks Keynesian economics, and me, because … Keynes once said something anti-Semitic.
I liked it better back in 2005, when they were ridiculing me because
[T]here is little reason to fear a catastrophic collapse in home prices.
Krugman will have to come up with something much better, I think, to cause many others to share his pessimism.
Another day in the life.
Update: And the offending Keynes quote apparently comes from an essay he wrote when he was 17.