Fancy that, there really are people in high places who think Krugman would have made a fine Secretary of the Treasury, not just columnists at The Grauniad. But as he puts it, why should he take a lower less influential job than the one he has already, a pontificating guru with no responsibility and where everything he says comes out right because he tells you so. In his words quoted via The Weekly Standard:
‘Yes, I’ve heard about the notion that I should be nominated as Treasury Secretary. I’m flattered, but it really is a bad idea, writes Krugman.
The first reason Krugman lists is, he admits, that he’s ‘indeed the World’s Worst Administrator — and that does matter.’
The second reason: ‘Oh, and there’s not a chance that I would be confirmed.’
But the foremost reason, according to the guy who was never offered the job in the first place, ‘is that it would mean taking me out of a quasi-official job that I believe I’m good at and putting me into one I’d be bad at.’
And, by his own admission, Krugman’s better at playing the ‘outside’ game than the inside one. He writes, ‘The New York Times isn’t just some newspaper somewhere, it’s the nation’s paper of record. As a result, being an op-ed columnist at the Times is a pretty big deal — one I’m immensely grateful to have been granted — and those who hold the position, if they know how to use it effectively, have a lot more influence on national debate than, say, most senators. Does anyone doubt that the White House pays attention to what I write?’
Working for Obama, rather than the Times, would be a step down. ‘By my reckoning, then, an administration job, no matter how senior, would actually reduce my influence, leaving me unable to say publicly what I really think and all too probably finding myself unable to make headway in internal debates,’ writes Krugman.
Krugman, a metonym for all that’s wrong with economics today, remains at his post. There really could not have been a better way to discredit Keynesian economics although, having observed the world for the past four years, there is nothing at all that could cause Y=C+I+G to disappear from our texts. Why people want to balance budgets in such uncertain times as ours if this little equation is valid is beyond me. But we see (a) that additional deficit financed public spending wrecks an economy and (b) that things get better as budgets are brought into line. How this equation helps to explain the way the world actually behaves no one really knows (they just show it by moving lines on a graph), but we will keep teaching it from now until the crack of doom.