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Paul Krugman

@paulkrugman

31 Dec 20

Tis the time to be thinking about the future, and one big question beyond 2021 is the prospects for technology. For background, here's the BLS measure of multifactor productivity — how economists (try to) measure the overall level of technology 1/

You can see the big slowdown beginning around 1973, the decade of IT-led growth from 1995 to 2005, and the Great Stagnation since then — when we were promised flying cars but got 280 characters instead (good line, even if Peter Thiel is loathsome) 2/

For what it's worth, I'm tentatively on the side of the techno-optimists 3/ noahpinion.substack.com/p/techno-optim…

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Paul Krugman

@paulkrugman

29 Dec 20

The proposal for $2000 stimulus checks is divisive, and not along simple left-right lines. Lots of disagreement among progressives, with people like Bernie Sanders very pro but many others not on board. Both sides have a point 1/

My take: the economics aren't very good, but the political economy may make such checks necessary 2/ nytimes.com/2020/12/17/opi…

@crampell

The key economic argument, which @crampell picks up on, is that given a slump that has affected people very unevenly, aid should concentrate on those actually suffering 3/ washingtonpost.com/opinions/2000-…

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Paul Krugman

@paulkrugman

27 Dec 20

Why has Trump apparently blown up the economic relief deal? I don't care, and neither should anyone else. In 24 days we can stop worrying about this terrible person's motives, and focus on the GOP backed him all the way. But there are more interesting questions 1/

One is whether $2K for most Americans is a good idea. Even some Democrats, notably Larry Summers, don't think so 2/ bloomberg.com/news/videos/20…

LS should always be listened to, but I think he's wrong here. I agree that across-the-board checks are not an ideal policy — much better to extend enhanced unemployment benefits until the economy recovers — but that's not politically on the table 3/

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Paul Krugman

@paulkrugman

24 Dec 20

OK, so we're apparently getting more or less a UK-EU free trade area for goods, although service trade will de facto face new protective barriers 1/ nytimes.com/2020/12/24/bus…

This is better than no deal, although tariffs were never the important issue; the serious costs of Brexit were always going to come from red tape and border checks, which are impossible to avoid unless you have a full customs union 2/ nytimes.com/2018/07/10/opi…

Wrong to be apocalyptic here: traffic flows pretty smoothly at the border between the US and Canada, even though we only have a free trade area. But there will be some costs — probably highest in the next few months, when business is still adjusting 3/

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Paul Krugman

@paulkrugman

23 Dec 20

Dems are gleefully signing on to Trump's demand for $2000 checks, hoping to embarrass Rs; fair enough. And it would do no harm, since debt is not a problem given negative real interest rates. But the way this is playing out is still bad news for the future 1/

Where we are now is that a minority of American have suffered a catastrophic loss of income, which is likely to last at least 6 months, while many have suffered no loss at all. Sending everyone a check is not a good response 2/

For someone who won't have earnings until we have mass vaccination, even a $2000 check isn't remotely enough to compensate for the loss of that $300 a week extra unemployment benefit starting in mid-March 3/

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Paul Krugman

@paulkrugman

20 Dec 20

Still thinking about the R effort — apparently abandoned as a practical matter — to prevent the Fed from acting to prevent crises. I still think sabotage was the main motive. But I wonder also whether the Fed's very integrity upset them. 1/

One of the shocking things about the past four years was the ease with which Trump undermined the professionalism of technocratic agencies, from the Weather Service to, of course, the CDC. But the Fed, protected by its quasi-independence, remained competent 2/

In particular, it quickly controlled a financial crisis that for 2 weeks looked worse than the fall of Lehman 3/

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