Paul Krugman vs Larry Summers Stagflation Nah..h

Larry Summers argues on side of caution with anti Covid stimulus. Paul Krugman argues, on the other hand, that we are not in a typical recession scenario. Instead what we have is a serious shrink in supply caused by corvid shutdowns. And that makes all the difference in the world. Krugman sees little chance of stagflation and besides we have the Federal Reserve who can combat any chance of falling into that. Besides this is an historic moment when we may have the chance to tilt the economy towards one with somewhat less inequality. the United States is high on the inequality scale among modern advanced industrial nations.

The other thing I took from this discussion is the stark difference in the style of these two very accomplished economists who are at the pinnacle of the profession. Caveat, I worked very briefly with Summers when he was young and working for Bill Clinton at the Treasury Department. He walked into my office one morning at the U.S, Department of Labor in 1991 and point blank asked me what we should do about the developing recession. Unemployment rate was about 6.8 percent then. I spouted something about increasing unemployment benefits and he told me to write it up. Out of that we got the Emergency Unemployment Compensation Act of 1991 (caveat I did not write up that whole act, just worked on it with other economist at the Labor Department.)

Summers comes across as careful, cautious loaded with gravitas (he was practically born an economist - the son of two economists, Robert Summers (changed the family surname from Samuelson) and Anita Summers, both professors at the University of Pennsylvania. Larry is also the nephew of two Nobel laureates in economics: Paul Samuelson (brother of Robert Summers) and Kenneth Arrow (brother of Anita Summers).

Krugman on the other hand is from a decidedly middle income family or even working class background. He is the grandchild of immigrants from Eastern Europe. Krugman is the easier talker of the two. He does none of the upward looking thoughtful thrust of the chin while trying to squeeze out his careful "insights." More often Krugman is looking down while talking or at least straight at you. And Krugman can stumble at times with what he starts out to say, then backs out and starts over (Summers almost never does this). It comes across as much more conversational and a bit easier to follow.

Here is a YouTube link to their discussion.

19 views0 comments