DEBATING POLITICS, ECONOMICS AND OTHER TIMELY TOPICS WITH PAUL KRUGMAN OF THE NEW YORK TIMES

FRIDAY, FEBRUARY 12, 2016

PAUL KRUGMAN

BACKSTORY

The Stakes Are High, So Consider the Evidence

Sanders
Gains More
Momentum

If you are still on the fence about

the Democratic primary, or still
persuadable, you should know
that Vox recently interviewed a
number of political scientists about
the electability of Senator Bernie
Sanders, and got responses ranging from warnings about a steep
uphill climb to predictions of a
McGovern-Nixon-style blowout
defeat (read the article here: bit.
ly/1RaHZe5). And all of these political scientists dismiss current
polls as being meaningless.
You are, of course, free to disagree with them. But you need
to carefully explain why you disagree.
What evidence do you have that
suggests that these scholars conclusions which are based on history and data, not just gut feelings
are wrong?
There are two unacceptable
answers that Im sure will pop up
again and again from readers. One
is to dismiss all such analyses as
the product of corruption theyre
all bought and paid for by Wall
Street, for instance, or the analysts
are just looking for a job in Hillary
Clintons administration. No, they
arent.
The other answer is to say that
youre willing to take a chance on
Mr. Sanders because Mrs. Clinton
would be just as bad as a Republican. Thats what Ralph Naders
supporters said about Al Gore in
2000; howd that work out?
I have some views of my own,
clearly, but Im not a political scientist I just read political scientists
and take their work very seriously.
What I do bring to this debate, I
hope, is an awareness of two kinds
of sin that can corrupt political
discussion.
The first, and more obvious,

TODD HEISLER/THE NEW YORK TIMES

Hillary Clinton and Bernie Sanders, the Democratic presidential candidates, shaking hands at a debate in New Hampshire this month.
and advocating for policies, because you like the story rather than
because you have any good evidence that its true. Ive spent a lot
of time over the years going after
this sort of thinking on the right,
where things like the claim that former Representative Barney Frank

sin involves actually selling ones

views. And that does happen, of
course.
But what happens even more, in
my experience, is an intellectual
sin whose effects can be equally as
bad: self-indulgence.
By this I mean believing things,

READER COMMENTS FROM NYTIMES.COM

An Unpredictable Election Cycle

We shouldnt take political
scientists predictions quite so
seriously this year.
Weve already witnessed multiple examples of this election cycles
unpredictability.
MATT J., TEXAS

According to polls, Hillary

Clinton has the highest unfavorability ratings among candidates
from both parties, with the exception of Donald Trump.
So anyone who thinks that Mrs.
Clinton might be more electable
than Senator Bernie Sanders is
mistaken. The results from the
Iowa caucuses proved that Mr.
Sanders has more support than

Mrs. Clinton among groups like

independent-leaning liberals and
voters under the age of 30.
Support from those demographic
groups will be critical in the general election later this year.
NAME WITHHELD, CALIFORNIA

I support Mr. Sanders, but if

he loses, Ill vote for Mrs. Clinton
and enthusiastically support her.
JOHN F. MCBRIDE, WASHINGTON

Perhaps America needs another Roosevelt reset. As presidents, both Theodore Roosevelt
and Franklin D. Roosevelt did
what was seemingly impossible.
Both were able to regain control

of the country after it had been

captured by elites. In doing so, they
likely saved capitalism.
These days, the United States
seems primed for another reset. If
we get it, perhaps the nation will
miraculously survive again. If not,
who knows?
WILLIAM BUCHANAN, OREGON

I have two problems with the

term unelectable.
First, it presumes that elections
are predictable, when in reality
anything can happen. What I especially hate, though, is the pretense
to knowledge, even in the face of
contrary evidence. For instance,
people who never predicted the

somehow caused the financial

crisis so often prevail in the teeth of
overwhelming evidence.
But it can happen on the left,
too which is why, for example,
Im still very cautious about claims
that inequality is bad for growth.
On Mr. Sanderss electability, by

all means consider the evidence

and reach your own conclusions.
But do consider the evidence
dont decide what you want to
believe and then make up justifications.
The stakes are too high for that,
and history will not forgive you.

rise of Mr. Trump continue to argue

that they have the foresight to declare Mr. Sanders unelectable.
My second problem is that the
term unelectable connotes a sense
of entitlement. Its usually the outsiders who are deemed unelectable
people like Margaret Thatcher
and Jeremy Corbyn in Britain, for
instance. Establishment figures,
however, are rarely described as
being unelectable because theres
a presumption that elections can
only be won by particular types of
people youngish, good-looking
politicans who went to the right
schools, for instance.

as a realist who is driven solely

by the facts. On the other, you are
launching one-sided attacks on Mr.
Sanders and his supporters without acknowledging any flaws in
Mrs. Clintons candidacy.
If you truly want to convince
some of Mr. Sanderss supporters
to vote for Mrs. Clinton, youre
going to have to be honest about
her shortcomings and about the
corruption of the electoral system.
Only then can you effectively argue
that we should support her because
Mr. Sanders is too big a risk.
DONALD, NEW YORK

NYE HUGHES, BRITAIN

Mr. Krugman, you are trying to

do two things simultaneously,
and your arguments arent working.
On the one hand, you are posing

ONLINE: COMMENTS
Comments have been edited for clarity
and length. For Paul Krugmans latest
thoughts and to join the debate online,
visit his blog at krugman.blogs.
nytimes.com.

Senator Bernie Sanders won the

Democratic presidential primary in
New Hampshire on Feb. 9, besting former Secretary of State Hillary Clinton
by a substantial margin. Mr. Sanderss
win comes a little more than a week after he and Mrs. Clinton effectively tied
in the Iowa caucuses (Mrs. Clinton was
declared the winner by a razor-thin
margin).
The recent rise of Mr. Sanderss popularity has come as a surprise to many
political analysts. A self-described
democratic socialist, the candidate
has repeatedly called for a political
revolution to challenge the influence
of wealthy interests in American politics. Mr. Sanders supports a national
jobs program, free college tuition and a
government-funded health care system
akin to those in Canada and Europe.
Amid Mr. Sanderss early successes, however, some commentators have
expressed worry that the Democratic Party could condemn itself to a landslide defeat in the general election if it
were to nominate Mr. Sanders, whose
politics fall well to the left of traditional Democratic candidates. And even
though Mr. Sanders is polling more
strongly than Mrs. Clinton in headto-head matchups against Republican
candidates, some experts believe that
this is because Mr. Sanders has not
yet been subjected to the kinds of attacks that Mrs. Clinton has endured for
many years.
Mr. Sanderss prospects are sometimes compared to those of George
McGovern, a presidential nominee favored by the activist left of the Democratic Party in 1972. Mr. McGovern lost
to Republican Richard Nixon in one of
the largest defeats in presidential history. Other analysts have compared
Mr. Sanders to Barry Goldwater, a
very conservative Republican who lost
the 1964 presidential election in a landslide to Lyndon B. Johnson.
In a recent interview with Vox, Jedediah Purdy, a Duke University professor who specializes in political identity,
explained that Goldwaters movement campaign and the lessons mainstream Republicans took from it afterward made [Ronald] Reagans
campaign possible in 1980 by rearranging the whole political landscape. But
he cautioned that Sanders is trying to
achieve realignment much more quickly than that. In terms of the suddenness and degree of his break with the
mainstream, he looks like Goldwater in
1964 more than like Reagan.

PAUL KRUGMAN

What the Bond Markets Are Telling Us

While Americans obsess
over domestic politics not
that theres anything wrong
with that, since a lot depends on
whether the next leader of the
worlds most powerful nation
is a racist xenophobe, a sinister
theocrat, an empty suit or all of
the above something scary is
going on in financial markets,
where bond prices in particular
are indicating near panic.
I know, the wisdom of crowds is
often overrated the economist
Paul Samuelson once famously
quipped that the stock market
had predicted nine of the last five
recessions. But bond markets
are a bit less flighty than stocks,
and also more closely tied to the
broader economic outlook. (A
weak economy has mixed effects

Paul Krugman
joined The New
York Times in 1999
as a columnist on
the Op-Ed page
and continues
as a professor of
economics and
international
affairs at Princeton
University. He was awarded the
Nobel in economic science in 2008.
Mr. Krugman is the author or editor
of 21 books and more than 200
papers in professional journals and
edited volumes. His latest book is
End This Depression Now!

on stocks low profits but also

low interest rates while it has
an unambiguous effect on bonds.)
And what plunging rates tell us is
that markets are expecting very
weak economies, and possibly
deflation for years to come, if not a
full-blown crisis.
Among other things, such a
world would be a very bad place
to elect a member of a political
party that has spent the past seven years inveighing against both
fiscal and monetary stimulus,
and has learned nothing from
the utter failure of its predictions
to come true.
Structural Humbug Revisited
Bryan Caplan, an economics
professor at George Mason University, recently reported that he

won a bet with fellow professor

and economist Tyler Cowen over
whether the unemployment rate
would ever drop below 5 percent
in the United States. It might be
worth remembering the context
of their bet.
When the Great Recession
struck in 2008 a demand-side
shock if ever there was one it
took no time at all for a strange
consensus to develop among
elites to the effect that a large
part of the rise in unemployment was structural, and that
it could not be reversed simply
through a recovery in demand.
Workers just didnt have the
right skills, the argument went.
Many of us argued at length
that this was a foolish notion. If
skills were the problem, where

were the occupations with rapidly rising wages? I pointed out

that people used to say the same
thing during the Great Depression, only to see their argument
disproved when we finally got a
big fiscal stimulus called World
War II.
But the doctrine somehow
just got stronger and stronger in
elite circles, because it sounded
serious and judicious, unlike the
seemingly frivolous proposition
that all we needed was more
spending. In fact, the notion that
our unemployment problem in
the United States was mainly
structural began to be presented
as a simple fact rather than as
a hypothesis most professional
economists rejected.
And here we are.

READER COMMENTS FROM NYTIMES.COM

Should We Expect a Crisis?

Of course, Republicans and their
various doomsayers have no solutions to offer when it comes to
economic turmoil. The best that
they can come up with is: Were
gonna die folks!
That said, any solution that the
G.O.P. might put forward would
likely accelerate the economic downturn.
My own doomsayer prediction is
this: A Republican win in this years
presidential election will spark a major depression in the United States,
and struggling economies around
the world will fall like dominoes.

The Republicans handed us this

problem in 2008, but these days they
want to blame everything on President Obama.
On the other hand, Democrats are
once again shooting themselves in
the foot by allowing this ridiculous
battle between Hillary Clinton and
Bernie Sanders to continue.
Mr. Sanders is not going to save
the day folks! Once he demonstrates
that he is a strong enough contender
to gain the Democratic nomination,
the G.O.P. will go after him hard, as
will the media.
Mrs. Clinton has the ability, expe-

KEVIN HAGEN/THE NEW YORK TIMES

Traders working on the floor of the New York Stock Exchange last month.
Investors are increasingly concerned about a weakening global economy.

rience and intelligence to stand up to

a seriously disabled Congress.
HAROLD, FLORIDA

escalate tensions in the Middle East,

or perhaps on the Korean Peninsula.
S., NEW YORK

This is the only way to finally eradicate movement conservatism from

the national stage.
PAUL LEIGHTY, WASHINGTON STATE

Rational fiscal policy requires

that Congress cooperate with the
president. But can either Democratic presidential contender generate enough voter enthusiasm to
replace the Republican majorities in
the House and Senate?

Together with the European

Union establishment, Republicans
caused todays global output gap
by implementing idiotic austerity
measures after the 2008 financial
crisis.
NAME WITHHELD, FLORIDA

E., MASSACHUSETTS

My fear is that if a Republican

president is elected this year, he
will finally try to pass a real fiscal
stimulus bill.
Of course, the stimulus wouldnt
be used to rebuild our infrastructure. It would involve massive military spending, which would likely

The likely outcome of the November election will be a Democrat winning the White House and
the Senate flipping back to the
Democrats.
Flipping the House of Representatives will take longer, but it is my
sincere hope that independents and
liberals hang in for the long haul.

The lastest slump all started

with Europe, the euro and austerity. A faltering European market for
Chinese exports crippled the Chinese economy, which then crippled
other developing economies.
The only bright spot in the world
economy was the United States, but
the country has now been hit by a
falloff in aggregate demand.
And it looks like the Federal Reserve made a mistake in raising interest rates too early. If Fed officials
had a lick of common sense, they
would admit their error.
DAVID, NEW ZEALAND