Monday, September 28, 2009
Imagine if you had to rely on Paul Krugman to filter your information...
Hey kids, pop quiz time!
(1) Using this Paul Krugman NYT column from September 24, tell us how costly the CBO says Waxman-Markey's cap-and-trade plan will be, in the year 2050.
(2) Using this Paul Krugman blog post from September 27, tell us how costly the CBO says Waxman-Markey's cap-and-trade plan will be, in the year 2050.
(3) Calculate the maximum discrepancy between your answers for (2) and (1), in percentage terms of the answer for (1).
(4) Using Krugman's blog post, find the spot where Krugman explains the size of your answer for (3). (Hint: Don't spend too much time looking.)
(5) Relying on both Krugman's blog post and his NYT column, which side of the climate debate does Krugman think is full of ideologues playing fast and loose with statistics to bamboozle a gullible public?
UPDATE: Some readers point out in the comments that the same CBO report (pdf, pages 2-3) contains both the "1.2 percent of income" and "1.1% - 3.4% of GDP" estimates for the cost of Waxman-Markey in 2050. So that means we can't get too upset at Krugman for switching between these two stats from one article to another. However, my beef is now with the CBO: I think they must be doing things like saying, "The efficiency mandates will mean people will have to spend less on heating their homes etc.," but still, there should be an idiot check. How can it be that Waxman-Markey will reduce GDP by 1.1% - 3.4% by 2050, yet at the same time will only reduce household income by 1.2%? That just doesn't make sense.
(1) Using this Paul Krugman NYT column from September 24, tell us how costly the CBO says Waxman-Markey's cap-and-trade plan will be, in the year 2050.
(2) Using this Paul Krugman blog post from September 27, tell us how costly the CBO says Waxman-Markey's cap-and-trade plan will be, in the year 2050.
(3) Calculate the maximum discrepancy between your answers for (2) and (1), in percentage terms of the answer for (1).
(4) Using Krugman's blog post, find the spot where Krugman explains the size of your answer for (3). (Hint: Don't spend too much time looking.)
(5) Relying on both Krugman's blog post and his NYT column, which side of the climate debate does Krugman think is full of ideologues playing fast and loose with statistics to bamboozle a gullible public?
UPDATE: Some readers point out in the comments that the same CBO report (pdf, pages 2-3) contains both the "1.2 percent of income" and "1.1% - 3.4% of GDP" estimates for the cost of Waxman-Markey in 2050. So that means we can't get too upset at Krugman for switching between these two stats from one article to another. However, my beef is now with the CBO: I think they must be doing things like saying, "The efficiency mandates will mean people will have to spend less on heating their homes etc.," but still, there should be an idiot check. How can it be that Waxman-Markey will reduce GDP by 1.1% - 3.4% by 2050, yet at the same time will only reduce household income by 1.2%? That just doesn't make sense.
Comments:
"In the absence of government action, the private sector will increase emissions up to the point where there is no further marginal benefit. That is, emissions will rise to whatever level is implied by profit-maximization, paying no attention to the effects on the environment." --Krugman "The textbook economics of cap-and-trade"
Krugman doesn't know that, he can't know that, and that he pretends that he does makes him a rotten liar. That he fudges his numbers comes as no surprise.
Krugman doesn't know that, he can't know that, and that he pretends that he does makes him a rotten liar. That he fudges his numbers comes as no surprise.
# posted by 
: September 28, 2009 at 9:58 AM
: September 28, 2009 at 9:58 AM
This is the best I could come up with, but I feel like I'm doing it wrong:
1) 1.2% of income
2) 1.1-to-3.4% of income
3) 283%
4) It's a trick question -- he doesn't!
5) The side that he doesn't agree with!
Was I right? Do I win a prize?!
1) 1.2% of income
2) 1.1-to-3.4% of income
3) 283%
4) It's a trick question -- he doesn't!
5) The side that he doesn't agree with!
Was I right? Do I win a prize?!
# posted by : September 28, 2009 at 3:14 PM
: September 28, 2009 at 3:14 PM
Bob, were do Austrian perspectives about preferences, property rights and rent-seeking fit into your pop quiz?
(Sorry, I'm getting on a flight back to Tokyo and can't look up Krugman.)
(Sorry, I'm getting on a flight back to Tokyo and can't look up Krugman.)
The Blackadder Says:
To me the mystifying part is why Krugman said 1.2% instead of 1.1% in his NYT column. If you're going to pretend that the low ball estimate is all there is why add a tenth of a point to it?
To me the mystifying part is why Krugman said 1.2% instead of 1.1% in his NYT column. If you're going to pretend that the low ball estimate is all there is why add a tenth of a point to it?
# posted by : September 28, 2009 at 4:58 PM
: September 28, 2009 at 4:58 PM
Blackadder,
Krugman didn't fudge the number, what happened (I believe) is that the CBO changed their official estimate. I'm not accusing Krugman of lying, I'm accusing him of touting the CBO as a "consensus" forecast without realizing that his reporting of the "objective" numbers went up (a maximum of) 283% in 3 days.
Krugman didn't fudge the number, what happened (I believe) is that the CBO changed their official estimate. I'm not accusing Krugman of lying, I'm accusing him of touting the CBO as a "consensus" forecast without realizing that his reporting of the "objective" numbers went up (a maximum of) 283% in 3 days.
Brian N. wrote:
Krugman doesn't know that, he can't know that...
Actually Brian, that's about the one portion of Krugman's post that I agreed with. It's a tautology. E.g. if the price of apples if $2/lb., then consumers will buy apples until the point at which the marginal benefit of an additional unit of apples has dropped to $2 / lb.
All Krugman is saying in that quotation is that if the price of something is zero, people will use it until the point at which marginal benefits have been pushed to zero.
Are you objecting to the infinitesimal steps involved in the argument? It seemed you were angered at a more fundamental level.
Krugman doesn't know that, he can't know that...
Actually Brian, that's about the one portion of Krugman's post that I agreed with. It's a tautology. E.g. if the price of apples if $2/lb., then consumers will buy apples until the point at which the marginal benefit of an additional unit of apples has dropped to $2 / lb.
All Krugman is saying in that quotation is that if the price of something is zero, people will use it until the point at which marginal benefits have been pushed to zero.
Are you objecting to the infinitesimal steps involved in the argument? It seemed you were angered at a more fundamental level.
Krugman is making a claim to know something that borders on the noumenal - other people's values - and short of God existing and channeling it to him, or him being telepathic and invading the privacy of other people's thoughts, he can't know that. The idea of the entrepreneur as nothing but a maximizer of monetary profit is unrealistic at best. Man is a much more complex creature than Krugman's one-dimensional view of him would allow.
# posted by : September 29, 2009 at 12:59 PM
: September 29, 2009 at 12:59 PM
I gues none of you libertardians bothered to click the link Krugman provided where it's clear right from the first couple pages that these are two different statistics -- income losses and loss of purchasing power.
# posted by : September 30, 2009 at 8:11 PM
: September 30, 2009 at 8:11 PM
Steko wrote:
I gues none of you libertardians bothered to click the link Krugman provided where it's clear right from the first couple pages that these are two different statistics -- income losses and loss of purchasing power.
Steko, I'm not being sarcastic; I hope you're still reading. Please point out exactly where the CBO report explains that 1.1 percent of income in 2050 is consistent with "1.2 - 3.4% of GDP." I have a blog post at MasterResource scheduled to come out on Friday on this very issue, so I want to catch it if I'm being unfair to Krugman.
I gues none of you libertardians bothered to click the link Krugman provided where it's clear right from the first couple pages that these are two different statistics -- income losses and loss of purchasing power.
Steko, I'm not being sarcastic; I hope you're still reading. Please point out exactly where the CBO report explains that 1.1 percent of income in 2050 is consistent with "1.2 - 3.4% of GDP." I have a blog post at MasterResource scheduled to come out on Friday on this very issue, so I want to catch it if I'm being unfair to Krugman.
Bob, I think Steko is talking about the the third point on page 2 and the first point on page 3 of the report.
The first point clearly says the CBO projects a loss of 1 and 3.5% to GDP by 2050, and the second point goes on to say that Waxman-Markey will lead to an after-tax income reduction of 1.2% in 2050. Krugman even makes the distinction in both his article and his blog post.
The first point clearly says the CBO projects a loss of 1 and 3.5% to GDP by 2050, and the second point goes on to say that Waxman-Markey will lead to an after-tax income reduction of 1.2% in 2050. Krugman even makes the distinction in both his article and his blog post.
# posted by : October 1, 2009 at 12:37 PM
: October 1, 2009 at 12:37 PM
Anon,
OK thanks. I knew Krugman was saying income in one post, and GDP in another, but I didn't realize the CBO in the same report used the two different stats. Up till your clarification, I had thought the latest CBO report didn't mesh with earlier ones.
So my beef now is with the CBO. How can after-tax income fall by 1.2 percent, if GDP is falling by 1.1 - 3.4%? The CBO isn't factoring in a giant tax cut.
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OK thanks. I knew Krugman was saying income in one post, and GDP in another, but I didn't realize the CBO in the same report used the two different stats. Up till your clarification, I had thought the latest CBO report didn't mesh with earlier ones.
So my beef now is with the CBO. How can after-tax income fall by 1.2 percent, if GDP is falling by 1.1 - 3.4%? The CBO isn't factoring in a giant tax cut.
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