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I think it's highly unfair to rank Stiglitz and Krugman among "he same economists". Or to imply that they describe deflation as painless.

Or even as THE solution. All in all, they would probably advocate greater fiscal integration. But that would not work too well with the current German memes either.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Thu May 6th, 2010 at 06:26:51 AM EST
[ Parent ]
Everyone thinks¨"growth" sounds good.

"Stability" is pretty nice, too.

So is "fiscal responsibility".

And "single market freedoms".

And "sovereignty".

And "rising living standards".

And "low taxes".

And "quality public services".

And "a social safety net".

The trouble is having all of these things simultaneously seem to be inconsistent with any view of macroeconomics which is not a fairy tale, in the line of Veblen, Keynes, Fisher, Minsky and Keen.

Oh, darn, I'm sounding like an economics crackpot again...

The brainless should not be in banking -- Willem Buiter

by Migeru (migeru at eurotrib dot com) on Thu May 6th, 2010 at 06:35:39 AM EST
[ Parent ]
I agree with what you say.
But the way I read these two (Krugman and Stiglitz), they seem to me to be aware of the fact that they can't all go together -or, actually, are good per se (certainly growth, single market freedoms and low taxes are not an unqualified positive).

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi
by Cyrille (cyrillev domain yahoo.fr) on Thu May 6th, 2010 at 07:08:17 AM EST
[ Parent ]
The current EU crisis is political - all about sharing losses.

The problem is that, as we know, sharing is only possible when economic growth is sufficient to mask the extent to which the sharing is unfair. In the middle of the biggest economic crisis since the 1930's, people are in each-man-for-himself mode and the EU has deliberately downplayed the political aspects of European integration for the past 15 years.

The brainless should not be in banking -- Willem Buiter

by Migeru (migeru at eurotrib dot com) on Thu May 6th, 2010 at 07:18:45 AM EST
[ Parent ]
This is true. Why it's true is not explained by politics or economics, but cognitive science and history.

"sharing is only possible when economic growth is sufficient to mask the extent to which the sharing is unfair"

You're really talking about how rich people capture the memes people operate under.

Well, maybe the Internet blogs will make a revolution of redistribution. Not likely, tho.

Align culture with our nature. Ot else!

by ormondotvos (ormond.otvosnospamgmialcon) on Thu May 6th, 2010 at 09:43:28 PM EST
[ Parent ]

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