OK - something I should have done from the beginning, and now advice I have for anyone engaging in ecumenical squabbles: if you are disputing a specific idea held by a school of thought always refer to it as "crude X theory" as in "crude Austrian business cycle theory", even if you're talking about something pretty specific. This whole "crude Austrian" and "crude Keynesian" development is actually pretty ingenious. It allows us to criticize the really dumb stuff masquerading out there while steering clear of the strawman accusations. It also allows us to engage the stuff we actually do know about the other side without being a seasoned expert on it.
I still maintain I was pretty clear. And Krugman was absolutely unambiguous about what he was talking about (he provided quotes of what he was disputing for God's sake! How could you mistake him for trying to dispute anything else?!?). But nevertheless - better safe than sorry.
We still have an unresolved issue, of course. Do we really have a good arbitration between ABCT and traditional Keynesian explanations of the downturn? I still really, really, really don't think so. Powell, Woods, and Murphy propose 1920-21, but I think that case is epically bad. It's a test between ABCT and crude Keynesianism at best, and who really cares about that contest? I'm with Hayek every time in that match-up. So what is to be done? Ultimately, I think we're in a situation that Matthew Arnold described best:
" ...for the world, which seems
To lie before us like a land of dreams,
So various, so beautiful, so new,
Hath really neither joy, nor love, nor light,
Nor certitude, nor peace, nor help for pain;
And we are here as on a darkling plain
Swept with confused alarms of struggle and flight,
Where ignorant armies clash by night."
That's not meant to toss around the "ignorant" card - it's meant to emphasize that we're here as on a darlking plain.
Which really makes me feel like a pragmatist, a fallibilist, a skeptic, what have you.
For the Weekend...
4 hours ago