SYNOPSIS: Krugman responds to Ben Stein's ridiculous open letter complaining about Krugman's 3.12.02 valedictory for the late James Tobin
I guess I must be having an impact. You know you're really getting under peoples' skin when they go ballistic over perfectly nice, genteel columns.
I was somewhat surprised, while on vacation, to receive hostile, irrational email attacking my valedictory for James Tobin - the least biting column I've written for ages. Not until I got back and read a short squib in the New Republic did I realize where that came from - a bizarre screed by Ben Stein.
For what it's worth: I can be accused of a lot of things, but a "limited background in economics" isn't one of them. (Thanks to TNR for its put-down - alas, not available online - which points out that I received the Clark Medal, and that Mr. Stein is a game-show host).
Mr. Stein's father was a fine economist, a member of a rapidly vanishing species - moderate Republicans. But while punditry on the right seems to be mainly an inherited position these days (read David Brock's book!), Mr. Stein's genes don't excuse him from the responsibility to do some homework.Vague memories of what he heard in his undergraduate class in the 1960s don't cut it.
I'm tempted to assign Mr. Stein some readings, starting with Tobin's Essays in Economics: Volume 1, Macroeconomics. It gives you a pretty good picture of what he did, of his debate with Friedman (the volume includes Tobin's critical review of Friedman and Schwartz, which Mr. Stein clearly has not read) and much more. I think I understand Tobin's contribution as well as anyone - and no serious economist has quarreled with my depiction of his work. (No, I didn't mention Q explicitly, only by implication; think 730 words, and the need to write something people can understand.)
Oh, and about Friedman: monetarism - which either meant that changes in M2 were the key to the business cycle, or meant nothing at all - has failed. Almost nobody focuses on monetary aggregates anymore; the current fashion in economic policy is "inflation targeting", while the current fashion in academic research is to suppress any explicit discussion of the money supply, and use other indicators of monetary policy.
Friedman's claim to greatness rests not on monetarism, which is now seen as a somewhat embarrassing - and, yes, "naive" - episode in his intellectual evolution, but on two lasting contributions: the permanent-income theory of consumption, and the natural-rate hypothesis.
If I had to psychoanalyze Mr. Stein, I'd say that the idea that I am a serious academic economist deeply disturbs him. After all, if I know what I'm talking about in eulogizing James Tobin, the other things I've been saying in my column might be true, and the politicians Mr. Stein supports might be as dishonest as I claim.
Anyway, I knew Jim Tobin - whom I talked with at length just a few days before his death - a lot better than Mr. Stein. And I certainly know a lot more economics.
Originally published on Paul Krugman's official site, 3.30.02