Saturday, June 16, 2012

Krugman goes to Comic-Con

While reading David Gordon's review of Krugman's new book--End This Depression Now!--at Mises, a couple of thoughts struck me. The book itself is some 250+ pages of Krugman defending his core belief: the more money the government spends, the better off we all are. And the promo line for the book at Amazon--"A call-to-arms from Nobel Prize–winning economist"--gave me a mighty chuckle, as Krugman's Nobel award once again becomes the sole justification for his much-vaunted expertise in government policy and all things economic.

But all of that aside, the "spend more money now!" mantra triggered another idea in my head. Since The Avengers has been out for a while, I don't think I'll be spoiling anything (sorry if I do) by noting that the final battle sequence involves the wholesale destruction of large sections of New York City. And this is hardly the first comic book-inspired movie to show such things. In Thor, a small town was flattened; in Fantastic 4: Rise of the Silver Surfer, destruction was visited on major cities around the world; in X-Men: The Last Stand, the Golden Gate Bridge was mangled and moved to Alcatraz. I'm told there was also a great deal of destruction in The Incredible Hulk, but I have never actually seen the movie, so I can't really say with certainty. In some ways, World War II--as portrayed in Captain America: The First Avenger--was quite tame in comparison.

And these are just the adaptions of a few comic books to the silver screen. For those of us who grew up reading the exploits of Marvel heroes--who lived in the real world, not Gotham City or Metropolis--wanton destruction of cities was quite commonplace. And non-stop. One has to wonder when there was time to clean up and fix everything, before the next super-villain appeared on the scene. Really, cities like New York should have been abandoned wastelands by the late 1980's, if not earlier.

And yet...

If Krugman's views are taken at face value, if massive government spending is always a good thing, if it leads to economic growth, maybe such destruction is itself actually a Good Thing. Maybe what we actually need right now are some serious no-holds-bared battles in Chicago, Detroit, LA, NYC, and even DC between some superheroes and super-villains. Then I guess the government would be forced to spend seven or eight trillion dollars to fix everything and prosperity would be assured. That's real creative destruction!

As Krugman says in a recent blog entry (my boldface):
The chart also illustrates just how much bigger the housing bust was than the tech bust of the early Bush years, which is why conventional monetary policy wasn’t enough to cope — and why we needed rising government employment and spending on goods and services, not the unprecedented austerity we actually got.
Certainly, having to rebuild lower Manhattan would fit Krugman's prescription like a glove. And note too how Krugman is still whining about the housing bubble (bust), even though he had called for a housing bubble in the past to alleviate the bursting tech bubble.

In Krugman-land, the economy is nothing but a function of policy; there is a policy answer to every possible situation, to achieve any desired result. And oddly, that answer almost always involves spending oodles and oodles of money and/or driving the government deeper into debt. Money grows on trees, apparently. And let's face it, this is exactly how things are in comic book land, as well, since destruction is overcome with a wink of an eye or a flip of the page. Yet still Krugman has the audacity to claim his critics are the ones dealing in fairy tales.

But perhaps there is a greater truth here. Perhaps what we are seeing is the origin of a new superhero: Keynesian Man! At some point, perhaps Krugman will realize that his columns are not enough, that he will have to don cowl and cape in order to do battle with the evil minions of Dr. Conservative and Professor Libertarian. No doubt, Krugman would ultimately defeat them with his Nobel Ray or his Stimulus Vision. Then, when the evil ones are vanquished, Obama can step in with his Infrastructure Bank and rebuild everything in preparation of the next battle to save mankind.

Cheers, all.

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