Here.
That is quite extraordinary.
I seem to remember the guy who keeps yapping about liquidity traps is the same guy who yaps a lot about the need for lots of monetary easing, and that he has made both points with respect to Japan (Sumner is talking about Japan here).
But I must be crazy.
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This is really puzzling.
ReplyDeleteIs Sumner genuinely ignorant of what has been said? Or does he know and he just thinks there's some gain in misrepresenting it?
Those really are the only two options, at least as far as I can tell. There has not been a lot of ambiguity on the question of what Paul Krugman has said about monetary policy in a liquidity trap, particularly w.r.t. Japan. And I think it's fair to say that most of us are to some extent taking cues and/or inspiration from Krugman (he is the modern Bastiat, after all). But there's been no ambiguity. Actually, as Bob Murphy shared a little while back, if anything Krugman has been ambiguous on fiscal policy in Japan, not monetary policy.
Both of those options - that Sumner is genuinely ignorant of this or that Sumner is not ignorant and deliberately misrepresenting things - are not pleasant options. I find the first option highly improbable.
And I'll reiterate a point I've made before: if you try to convince policymakers and the public that lots and lots of people disagree with you when they don't disagree with you, you are making good policy LESS likely, not MORE likely.
ReplyDeleteI am tough with you Keynesians, but I am fair.
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