Paul Krugman ridicules Irish decision-makers in NYT

GreenIsGood

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In NYT Princeton Economist Paul Krugman mocks the "serious people" in DOF & Irish government who issued their crackpot unlimited guarantee of the gambling debts of banks that they did not understand and had not regulated.

Then the bubble burst, and those banks faced huge losses. You might have expected those who lent money to the banks to share in the losses. After all, they were consenting adults, and if they failed to understand the risks they were taking that was nobody’s fault but their own. But, no, the Irish government stepped in to guarantee the banks’ debt, turning private losses into public obligations.

Before the bank bust, Ireland had little public debt. But with taxpayers suddenly on the hook for gigantic bank losses, even as revenues plunged, the nation’s creditworthiness was put in doubt. So Ireland tried to reassure the markets with a harsh program of spending cuts.
According to these "geniuses":

.. there is no alternative, say the serious people: all of this is necessary to restore confidence.
Ireland, they say, must continue to inflict pain on its citizens — because to do anything else would fatally undermine confidence..

..Ireland is now in its third year of austerity, and confidence just keeps draining away. And you have to wonder what it will take for serious people to realize that punishing the populace for the bankers’ sins is worse than a crime; it’s a mistake.
Who could argue?

http://www.nytimes.com/2010/11/26/opinion/26krugman.html?_r=1&src=twt&twt=NytimesKrugman
 


droghedasouth

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No one should underestimate the role of the Attorney General in this catastrophe.
A man of enormous ability and achievement who has worked endlessly to avoid a ****-up on his watch.
And yet is central to the implosion of the state.
 

Franzoni

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Sure what does Krugman and the rest of the international experts know,including the boss of one of the biggest investment corps in the world who said yesterday we should be allowed to negotiate on our bank debt and come to a deal..... compared to the huge expertise in the DoF and our glorious leaders worldwise view of what we should do even if it goes against all advice ...:rolleyes:

Really would make you wonder what the banks had on FF in 2008
 

Eye of Angkor

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No one should underestimate the role of the Attorney General in this catastrophe.
A man of enormous ability and achievement who has worked endlessly to avoid a ****-up on his watch.
And yet is central to the implosion of the state.
On the money. Another man who was central to all this was the Chair of AIB.

Just because you are an excellent barrister does not make you an even competent banker. Or Minister for Finance for that matter.

I recall that the guarantee was greeted with astonishment everywhere except Dublin. Ken Clarke's obs. last night on Question Time repeated this (whilst stressing the need to support Ireland).

This is an entirely homegrown catastrophe.
 

Dillinger

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He is wasting his time. Irish people do not accept advice from "foreigners".
 

Fir Bolg

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Can someone forward that article on to Brian Lenihan.

We can then await his usual rebuttal: "I don't accept that"
 

Sucker Punch

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On the money. Another man who was central to all this was the Chair of AIB.

Just because you are an excellent barrister does not make you an even competent banker. Or Minister for Finance for that matter.

I recall that the guarantee was greeted with astonishment everywhere except Dublin. Ken Clarke's obs. last night on Question Time repeated this (whilst stressing the need to support Ireland).

This is an entirely homegrown catastrophe.
How can you explain Greece, Portugal, Spain, Belguim, and Italy's misfortunes?
 

Cassandra Syndrome

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Paul Krugman is the worst economist in the world. He is a mega-hypocrite. Back in 2001 he called on Bush for a housing bubble. Then in 2009 he blames Bush for the Housing bubble. What he criticises our politicians doing, and he is right in that, he criticises Obama for not doing enough of.

He is a complete muppet and for exmple, he refuses to debate the Austrian School Business Cycle with the Ludwig Von Mises institute out of fear of being exposed as an economic illiterate.
 

cul de sac

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Can someone forward that article on to Brian Lenihan.

We can then await his usual rebuttal: "I don't accept that"
Yeah send him the article, may give him an opportunity to act on
'best advice available". The way they think government works is akin to monkeys being told which lever to pull.
 

Cassandra Syndrome

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Whatever about Krugman's abilities, is the content of this article more or less correct in your opinion CS?
Indeed, as I say, he is right in this case. But next week he could praise the Irish government for accepting the bailout. Thats his type.

A neo-keynesian that I would respect at least for being consistent during this crisis is Professor Stiglitz.
 

NunoF

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How can you explain Greece, Portugal, Spain, Belguim, and Italy's misfortunes?
Socialism.

With the exception of Spain, which did have a property bubble, all the rest is explained by socialism. Portugal has had 13 years out of 15, Greece 21 out of 30 and Spain something similar.

During this time the governments ballooned public expenditure, in the case of Greece and Portugal created huge monopolies and prevented competition in may areas, implemented by stiff labor laws that only allowed firing someone when the company has gone bankrupt, and above all, narrowed the difference between what you get from social welfare for not working and the net pay of a low paid worker to almost nothing.

Add a very well paid and large public sector (Portugal's public sector is twice as large, in proportion, to Ireland's) and there's the recipe for disaster.

In Portugal only 35% of the population works, and 65% lives of the state or is getting support form the state in one form or another.
 

flavirostris

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Krugman has summed it up succintly and simply. The government pushed the self destruct button on Ireland in Sep 2008
 

droghedasouth

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How can you explain Greece, Portugal, Spain, Belguim, and Italy's misfortunes?
Greece - lying feckless politicians and tax avoiding lying feckless electorate resulting in high public sector debt.

Italy - high public sector debt accumulated over aeons.
Despite a weak political system, they are however able to finance it from within Italy and hence are not the target of market speculators.

Belgium - high public sector debt accumulated over aeons.
Despite a weak political system, they are also able to finance it and hence are not the target of market speculators.

Spain - property bubble but nothing on the scale of Ireland.
There is also a long term demand for property in Spain as retirees from Northern Europe prefer to live in a warm climate. The Upper Shannon Basin does not not have the same charms except for a few former hippies.
 
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George Hook broadcast a snippet from this speech a few days ago on The Right Hook.

“This administration intends to be candid about its errors. For as a wise man once said, ‘An error does not become a mistake until you refuse to correct it.’ We intend to accept full responsibility for our errors…. We’re not going to have any search for scapegoats … the final responsibilities of any failure are mine and mine alone.”

- John F. Kennedy

(Kennedy spoke those words following the botched Bay of Pigs invasion)

Accountability. Inspiration. Kennedy.
 

slx

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It's just mind-boggling - What is wrong with the Government?!?!

This is really starting to just get beyond ridiculous. What is wrong with the Irish Government.

They are simply not working in the best interest of the people and seem to be absolutely determined to refuse point blank to listen to anyone who knows anything about economics.

They are ignoring all of the best advice, they are absolutely ignoring the will of the people and they are behaving like some kind of suicidal dictatorship.

What the hell is wrong with them? Who the hell do they think they are???

This is *our* money and *our* future that they're playing around with.

The madness absolutely has to stop and stop now. The current administration is literally putting the very viability of the state at risk for absolutely no reason other than they seem to be brainwashed into saving the banks at all (and I literally mean all) costs.

Who are these idiots working for?

Can we find out?

They are most certainly not working for the electorate or the people of Ireland.

Honestly, it's time to pull the plug on this mess. They clearly just will not listen and I think really it's time we stood up and did something. They're going to destroy us otherwise!

If you can get out and march on Saturday, please march. It's not enough to just tweet and rant online, you need to put your money where your mouth is and get out on the street.

If you can't get to the protest, at the very least lift the phone and ring every TD you can get the phone number of and give them a piece of your mind.

If you meet a TD or a councillor or any member of Fianna Fail or the Greens tell them what you think of them and their policies.

This simply cannot continue or we will not have a country to live in.

People have to wake up and do something, it can't go on any further. This isn't a joke, nor is it some remote theory, this is our very existence at stake.

If you can do anything to make your protest heard, please do it!!!
 

Tea Party Patriot

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Paul Krugman is the worst economist in the world. He is a mega-hypocrite. Back in 2001 he called on Bush for a housing bubble. Then in 2009 he blames Bush for the Housing bubble. What he criticises our politicians doing, and he is right in that, he criticises Obama for not doing enough of.

He is a complete muppet and for exmple, he refuses to debate the Austrian School Business Cycle with the Ludwig Von Mises institute out of fear of being exposed as an economic illiterate.
+1 Krugman is a failed entity as an economist. However I do agree with him on the banks creditors having to take loses, I wonder if he is converting to the Austrian way of thinking in his old age; now that would be a shock :eek:
 


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