Krugman Still Wrong After All These Years by Mish Shedlock

Krugman seems particularly proud of a piece he wrote a decade ago. His new remake, Hangover Theorists, is as wrong now as it was then. Let’s take a look.

The hangover theory, which I wrote about a decade ago, is still out there.

The basic idea is that a recession, even a depression, is somehow a necessary thing, part of the process of “adapting the structure of production.” We have to get those people who were pounding nails in Nevada into other places and occupation, which is why unemployment has to be high in the housing bubble states for a while.

The trouble with this theory, as I pointed out way back when, is twofold:

1. It doesn’t explain why there isn’t mass unemployment when bubbles are growing as well as shrinking — why didn’t we need high unemployment elsewhere to get those people into the nail-pounding-in-Nevada business?

2. It doesn’t explain why recessions reduce unemployment across the board, not just in industries that were bloated by a bubble.

One striking fact, which I’ve already written about, is that the current slump is affecting some non-housing-bubble states as or more severely as the epicenters of the bubble. Here’s a convenient table from the BLS, ranking states by the rise in unemployment over the past year. Unemployment is up everywhere. And while the centers of the bubble, Florida and California, are high in the rankings, so are Georgia, Alabama, and the Carolinas.

So the liquidationists are still with us.

Let’s answer Krugman’s two points in reverse order starting with number 2:

I’m always surprised how simple Austrian economic theory is and yet so many monetarists and Keynesians seem to completely misunderstand it.

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I wouldn’t normally give this windbag the time of day, except he’s put together a great, dead-pan commentary on the economy.

Glad to see him applying his skills at something he’s actually good at.  His performaces during the Republican debates were a trainwreck.

http://wokv.com/..

The Duval County Supervisor of Elections Office has released the list of write-in candidates from the 2008 presidential election.

The list includes 736 votes in all, covering 191 different candidates.

Hillary Clinton topped all write-ins with 234 votes. Ron Paul had 174. The 3rd most votes? Jesus with 23.

Some of the others in the political arena receiving votes included Mike Huckabee, Mitt Romney, Colin Powell, Rudy Giuliani, and Al Gore.

Two people wanted and thought it was possible to get 4 more years out of President George W. Bush. Condoleeza Rice, John Edwards, Fred Thompson, Pat Buchanan, and Charlie Crist also had support.

One person wrote in Ralph Nader, ignoring the circle they could’ve filled in to signify that choice.

Newt Gingrich, Harry Reid, and Theodore Roosevelt also garnered support. One person just wrote Lieberman.

Jay Plotkin lost the race for State Attorney, but his 1 vote beat Angela Corey in the presidential race. And the hyrbid candidate Hilary Bush got a vote!?

In the battle of the Bills – Bill Cosby and Bill Nye both received 2, beating Bills Clinton and Richardson with one apiece.

Morgan Freeman got a vote

Chuck Norris did too.

Mr. Bill – yes, the fictional clay figure – also was chosen by someone to lead the country.

Oprah Winfrey endorsed Obama but one person out there said ‘no, Oprah, I want you!”.

Many names weren’t celebrities. Jacksonville resident Wayne Bryan says he voted for himself because he “didn’t like his choices”. When asked if he was ready to lead on day one if elected, he admitted probably not.

America got a vote. My dog. A bear. Mickey Mouse.

UF beat FSU as Tim Tebow received 2 votes with Seminole coach Bobby Bowden getting just one.

Jon Bon Jovi, someone honest, Tiger Woods, Tommy Chong, and perhaps the greatest write-in candidate of all time: Twice cooked pork $4.95

I think I have to agree with the last statement. Twice cooked pork $4.95 would have been the best president ever. Even better then William Henry Harrison.

http://kotaku.com/…

About seventy-five percent of game industry presidential campaign donations went to democrats, based on a sampling of developers and publisher donations over the past two years obtained from the Federal Election Commission.

Kotaku looked at presidential campaign donations for nine companies from January of 2007 through the end of July, 2008. The companies included were Activision, Blizzard, Electronic Arts, Nintendo, Sony Computer Entertainment of America, Take-Two, THQ, Ubisoft and Valve.

The database showed that the nine companies donated a total of about $97,800 to ten candidates, about $61,000 of which went to democratic candidates, while about $36,700 went to republican candidates.

The company with the largest contributions to campaigns was Electronic Arts, followed by Activision and then Valve. The company with the smallest amount of donations was Take-Two. Hit the jump for an avalanche of colorful pie charts and one, single, lonely bar graph.

The graphs unfortunately are scaled down too much to clearly see the legends on all of them but it is clear that while they lean Democratic party, Ron Paul was the favorite Republican. Being that I’m a gamer and a supporter of Ron Paul I’m glad to see this. Especially the Sony breakdown.

• The Democrat race is still in the air a bit. While Clinton is ahead by nearly 100 delegates there is still many states left and a long time till their convention.
• McCain did well as expected. I think primarily because of the number of winner take all states. Had the delegates been split up it would probably would have been much closer.
• McCain won 9 states. Huckabee 5. Romney 7. Paul 0.
• Accounting for things like what occurred in West Virginia the number of delegates dedicated to each candidate is not quite accurate.
• The available numbers also don’t account for any internal events which may be occurring in the states. I’m not familiar with the workings of all the different states but some use this primary or caucus to vote for state delegates which will at a later time pick national delegates. In those cases the MSM reports the national delegates as if they were already selected. If someone was to drop before the nationals are selected than they could vote differently.
• In several states Giuliani actually got votes. He even beat Paul 5% to 4% in California with 90% reporting. Assuming much of those votes would have gone to McCain it doesn’t look like they would have changed the results in any of the states. Again given the differing systems it’s hard to say for sure. Thompson even got 3% in Tennessee. In that race it could have changed the outcome. Huckabee got 34% and McCain got 32%. I suspect it would have helped Huckabee more than McCain however. I’d like to know if these were protest votes or people who didn’t realize their candidate of choice had dropped. I hope it’s the former.
• There has been several accounts of voting issues with Paul supporters. Three from people I know. Steve Miller in Brooklyn saw issues with voting machines not working and those running the poll said that only 2 Republicans where running and Jim Lesczynski and his wife had changed their party affiliation months ago yet the voting place had them as their old party. Here in NJ they had my girlfriend and I marked as unaffiliated and we had to choose which party to vote for on the spot. No harm but sad that I had changed to R months ago and received confirmation saying as much.
• Paul did well in states he was expected to do well in but not as well as some thought. 3rd in Alaska is disappointing given the level of support that was expected. He was the number 1 fundraiser there. In Montana Paul was again the number 1 fundraiser with more than twice what Romney in second raised. Yet Romney won 38% of the state delegates vs Paul’s 25%. Unfortunately Montana is a winner takes all state and the delegates are apparently required to vote for that individual. It’s even more interesting in North Dakota where Paul again was the largest fundraiser with Romney raising the least yet Romney won the majority with Paul a close 3rd with 21% to McCain’s 23%. Both get the same number of delegates as does Huckabee with his 4th place 20%.
• He also did worse in some states where he was polling last but with higher percentages than he actually received.

Paul generally got spanked but that was expected. The race is still not over and even with McCain in the lead he’s only 60% the way to the nomination. Obviously money does not mean votes. As a movement we need to better target the public. I truly believe the MSM did us great harm in this race and we need to figure out a way to deal with that in the future. The counties around the several states where Paul won or did well should be analyzed and replicated. I don’t believe there was anything particularly special about those voters it was how we advertised and presented our candidate to them. We need to convince people not only of his platform but his electability. As much as we hate that that is a major component to the average voters decision it’s reality and we need to counteract the MSM putdowns and writeoffs. Spend less money on blimps and more on newspaper, radio and TV ads. More articles to the editor which aren’t defensive and complaining about being left out but offensive and comparative and explains why our policies are right and better for the average voter. While we may lose this battle the fact we are able to get such high numbers in some areas of the nation should give us encouragement. In local and national elections were we are targeting much smaller audiences we have a better shot at getting freedom fighters in office. Murray Sabrin’s campaign for Senate has been able to get more money than they where asking for from 47 states. That kind of support will hopefully help get those people elected. Also as a libertarian candidate we’ve gotten a low of 3% and high of 25%. This is just unheard of in the Libertarian Party generally. Nationally Paul is pushing 7%-9% from what I’ve seen. That’s really huge. We do have an audience we just need to approach them. We probably have a larger audience we just need to get by the MSM’s attacks and blackout. On a local level that’s much easier.

It’s going to be interesting to see what happens when and if Huckabee or even Romney drop out. It seems to me that those supporting them would be hard pressed to support “liberal” John McCain. If Paul does not drop and seeks the Libertarian ticket he could possibly pick up quite a few delegates. I understand that is a fairly unlikely situation but I’d love to see it just to gage what and why people choose a candidate.

To leave on a more optimistic note, A Scorecard You Won’t Find on Fox News:

Supporter Loren C. sends in this excellent summary of what Ron Paul has achieved so far.

A friend of mine asked me tonight, “Should Ron Paul just quit? I never hear of him on the news so he can’t be doing very well today (Super Tuesday).” Here is my reply to him:

I don’t care what the liberal media is saying, he has,

2nd place in Nevada

2nd place in Louisiana (possibly first once they get it sorted out)

2nd place in Montana

2nd place in Maine

3rd place in Utah

3rd place in North Dakota

There is about 21 more states left to vote,

He has plenty of money,

No one has even close to enough delegates to take the nomination,

He has the only true Republican stance on the issues,

He is the only candidate who believes our government should follow ALL of the Constitution,

Quit?

Not even close. Keep fighting, Ron Paul is!

Well said. And while the momentum John McCain has been gaining lately may appear daunting, Ron Paul supporters are the ones who should be least intimidated by it, because as the other, fraudulent alternatives to John McCain fail one by one — Mitt Romney is certainly on the ropes after tonight, especially if, as appears to be the case, he loses California to McCain — the real alternative to McCain-ism, Ron Paul, will only become more attractive to conservative Republican voters.

Indeed, it’s interesting to note that so many of the states McCain won tonight were blue states which any Republican (except the antiwar Dr. Paul) will have a hard, if not impossible, time winning in November. And despite his wins tonight, McCain does not have a majority of Republican National Delegates, so the fight for the nomination is still very much on.

For Ron Paul preferably. It would be most appreciated. In NJ he should be in column 2 after Rudy Giuliani (no longer in the race) and before Fred Thompson (also no longer running.)

CNN was at my polling place but I didn’t see any reporter around. Before voting for Ron Paul I walked around the precinct putting Ron Paul door hangers on people’s front doors as a last minute attempt to convert voters. We’ll see.