https://www.nytimes.com/interactive/projects/cp/opinion/election-night-2016
Not just recently...in terms of the bank bailout (which he hated) and the Stimulus (which he pushed), he wasn't right. Krugman was hugely, massively wrong about Obama's bailout. According to Krugman, the bank bailout plan was doomed to failure [1]. He mocked the idea relentlessly; I cannot even count how many times he repeated Tim Duy's line that Bernanke and Geithner believe the are no bad assets, only misunderstood assets.
As it turns out, the bailout not only worked but also turned a profit [2]. Bernanke and Geithner were right.
[1]
http://www.reuters.com/article/2... [2]
http://articles.latimes.com/2012...
Krugman claims, as his book and column suggest, that he is, “the conscience of liberalism.” It might be better stated that he is the prophet of more and more government intervention
Stealing a Ph.D's post in "when has Krugman been wrong":
1) The survival of the Euro:
Krugman was unable to fathom how the peripheral countries of Europe could possibly stay on in the Eurozone. He wrote a number of blog posts effectively saying that the Euro was doomed and that Greece would leave any day now, with Spain and possibly Italy following suit. Not only did that not happen, the Euro club is infact slated to grow further.
Another Bank Bailout Crash of the Bumblebee Apocalypse Fairly Soon Those Revolting Europeans Europe’s Economic Suicide What Greece Means
Legends of the Fail The Hole in Europe’s Bucket An Impeccable Disaster Op-Ed Columnist - A Money Too Far - NYTimes.com Op-Ed Columnist - The Euro Trap - NYTimes.com
2) The mechanism of the housing bust: A number of people, including Krugman saw the housing bubble and predicted its demise, but Krugman was wrong about the details of how the bursting of the bubble would play out. He thought that it would involve a crisis in junk bonds and a fall of the dollar (None of these two happened)
He did say that subprime mortgages would go bust, but he underestimated the effect of that... He did not understand the risks posed by securitization and therefore, was not predicting an outright recession until well into 2008, a pretty big miss when dealing with the biggest worldwide slowdown since the great depression.
Krugman predicting fall of the dollar accompanying the housing bust:
Debt And Denial
3) Deflation: Krugman was confidently predicting deflation starting in early 2010. It never materialized. Inflation remained stubbornly positive. Source:
Core Logi
4) Relative performance of the worst-hit European countries: For a very long-time, Krugman kept praising Iceland for implementing capital controls and predicted that it would do better than others which kept their capital markets free (like Estonia, Latvia, Lithuania and Ireland). Did not pan out....
Krugman on Iceland vs Baltics and Ireland in 2010:
The Icelandic Post-crisis Miracle
The council of foreign relations questions Krugman's claim:
Geo-Graphics » Post-Crisis Iceland: Miracle or Illusion?
Geo-Graphics » “Iceland’s Post-Crisis Miracle” Revisited
Krugman, as classy as ever calls the people at CFR stupid:
Peaks, Troughs, and Crisis
CFR pwns:
Geo-Graphics » Paul Krugman’s Baltic Bust—Part
6) The sequester of 2013 would cause a slowdown in the US and the stimulus of 2009 would reduce unemployment: Krugman issued dire warnings about the sequester, predicting that it would cause a slowdown in the US pointing to papers that predicted 2.9% growth without the sequester and 1.1% with it. In reality, the sequester was passed and growth was 4.1%.
Sources:
Krugman (as usual) name-calling people who proposed the sequester:
Sequester of Fools
Keynesian models showing reduced growth because of sequester (linked in above article)
MA's Alternative Scenario: March 1 Sequestration
Krugman gloating when he thought things would go his way calling it a test of the market-monetarist view:
Monetarism Falls Short (Somewhat Wonkish)
Final reality check:
Mike Konczal: “We rarely get to see a major, nationwide economic experiment at work,”
This mirrored the experience of 2009 (but in reverse), when Keynesian models championed by Krugman predicted that US unemployment would top out at 9% without the stimulus and at 8% with it. The stimulus was passed and unemployment went up to 10%.
7) The recession would be over soon: Krugman and Greg Mankiw had a spat in early 2009 on something known as the unit root hypothesis. The discussion is technical but it essentially boiled down to this: Team Obama had predicted that the economy would bounce back strongly from the great recession and their models predicted that real GDP would be 15.6% higher in 2013 than it was in 2008.
Mankiw disputed this on the basis of the unit root hypothesis and said that recessions sometimes tend to linger and therefore, predictions should give some positive probability weight to that event .... Krugman described Mankiw as "evil" for refuting the administration's forecast based on what he believed to be flawed economics implicitly supporting the administration's forecast. Mankiw invited him to take a bet on the issue which Krugman ignored.
In reality, it was not even close. Mankiw won by a landslide. Real GDP in 2013 was infact only 6% higher than 2008.
Sources:
Team Obama on the Unit Root Hypothesis
Krugman harshly criticizing Mankiw for the above:
Roots of evil (wonkish)
Mankiw responds by asking Krugman to take a bet:
Wanna bet some of that Nobel money?
The final reality check showing that Mankiw would have won handily:
The forces of evil easily triumph over Krugman and DeLong
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