The economist Paul Krugman used to warn his readers in afterthoughts and footnotes that we should never allow the best to be the enemy of the good, and that while his work has blown up the first-best theorems of equilibrium economics the core ideas of the classics should not be thrown away. But the political pundit Paul Krugman does not warn his readers about the pitfalls. Instead, he rails against the unworkable laissez faire model at the same time as blaming the current administration for pursuing a laissez faire philosophy. Markets and unscrupulous businessmen and conservative politicians come under assault, while enlightened political leaders and insightful thinkers working together are seen as the solution to the social ills that free market fundamentalism has supposedly wrought. This is why Krugman can claim to be the liberal conscience of the intellectual crowd in the U.S. today.
Since the economist Paul Krugman has been buried by the political pundit Paul Krugman for over a decade, the probability that this prize will lead to a renewed appreciation of the subtle and fine points of the mainline of political economy stemming from David Hume and Adam Smith is quite low. Thus, the awarding of the Nobel Prize to Krugman today sends a mixed signal about the relative importance of economic science and scholarship as opposed to political and economic punditry. It also may unfortunately inspire more partisanship among economists and misunderstanding of the real contributions of the scientific discipline of economics to human betterment if the perception is that the Nobel Prize validates Krugman’s work as a pundit in the New York Times.
For economists who would like the Nobel Prize to mean something, today is a very sad day. Besides making a travesty of the prize, Krugman’s selection constitutes an insult to the few excellent economists (I am thinking especially of F. A. Hayek and James Buchanan) who have received the prize in the past
For me, it is just another reminder that those of us who believe in liberty are in for a long time in the intellectual wilderness. Today’s intellectual climate is a taste of what it must have been like to believe in liberty in 1933, or what it must have been like to be Milton Friedman in say, 1962.(…)
I’m not saying Krugman got the prize for his partisan advocacy. I have no idea. And I am not commenting on the quality of his academic work which I am not sufficiently familiar with to judge. What is unfortunate is that someone whose economic statements I mentioned above will be called a Nobel Laureate. And what is more unfortunate is that someone with his policy outlook (at least as it is articulated in his recent popular writing) which is hostile to liberty, will have a larger soapbox.
There are lots of good reasons to be annoyed with Paul Krugman. (Like here, here, and here). But as a cock-eyed optimist, I´m very happy to have him around. Think about it: The world´s most famous left-wing economist:
1. Blames European unemployment on labor market regulations that hold wages above the market-clearing level. (The Accidental Theorist, Part 1)
2. Publicly and articulately advocates free trade without hemming or hawing. (Pop Internationalism)
3. Identifies anti-globalization activists as the enemies of the world´s poor. (The Accidental Theorist, Part 3)
4. Titles an essay ´In Praise of Cheap Labor: Bad Jobs at Bad Wages Are Better than No Jobs at All´ (The Accidental Theorist, Part 3)