Ron Paul vs. Paul Krugman

[dustintrammell]

"Congressman Ron Paul, in a rare head-to-head broadcast confrontation, went up against the Nobel laureate in economics Paul Krugman in an open debate over monetary policy. It was broadcast on the Bloomberg Television, moderated by Trish Regan. Not to put too fine a point on it, Ron Paul won the exchange, so much so that the cameras and moderators just drifted away from Mr. Krugman without so much as a fare-thee-well and left the field to the hero of the campaign for honest money."

http://www.nysun.com/editorials/ron-pauls-clash-with-paul-krugman-displays-power/87810/

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[apetersson]

followup by Michael Suede mentioning Bitcoin:

http://www.policymic.com/articles/7811/ron-paul-won-the-paul-krugman-economic-debate-and-here-s-why

afai remember bitcoin was not mentioned in the original paul/krugman debate.

[cypherdoc]

i don't understand why Ron Paul or any defender of a fixed monetary supply like gold or Bitcoin never say that money printing is inherently unfair.  it would be easy to make the argument that inflation or money printing favors the bankers who get first crack at money at 0% and turn around and lend to shleps like us for 4-5%.  how is that fair?

they also turn around and use that free money to drive up their toys like stock and commodity prices to bubble highs before pulling the plug on retail investors who are tempted to get into those same manipulated markets.  this is exactly what we've seen from the bottom 3/09 to now.

a simple argument to someone like Krugman would go like this, "hey, why don't they give everyone free money at 0%", not just the cronies?

[Red Emerald]

Milton Feedman said why not replace the Fed with a computer?
Ron Paul: I'm with him.

He isn't talking about Bitcoin, but he is for allowing people to use private money.

[sunnankar]

i don't understand why Ron Paul or any defender of a fixed monetary supply like gold or Bitcoin never say that money printing is inherently unfair.  it would be easy to make the argument that inflation or money printing favors the bankers who get first crack at money at 0% and turn around and lend to shleps like us for 4-5%.  how is that fair?

When I make the argument I always ask the question, "Why can't I print up my own Federal Reserve Notes? Why is that punished as counterfeiting? Aren't we all equal?"

From there I just demolish any of their potential responses which are all on very shaky logical foundation.

[HappyFunnyFoo]

I love this.  Krugman obliterates this dunce.

[Red Emerald]

I love this.  Krugman obliterates this dunce.

So wait.  You agree with Krugman's theories of economics, but support bitcoin?  Seems to me it should be one or the other.

[cypherdoc]

i don't understand why Ron Paul or any defender of a fixed monetary supply like gold or Bitcoin never say that money printing is inherently unfair.  it would be easy to make the argument that inflation or money printing favors the bankers who get first crack at money at 0% and turn around and lend to shleps like us for 4-5%.  how is that fair?

they also turn around and use that free money to drive up their toys like stock and commodity prices to bubble highs before pulling the plug on retail investors who are tempted to get into those same manipulated markets.  this is exactly what we've seen from the bottom 3/09 to now.

a simple argument to someone like Krugman would go like this, "hey, why don't they give everyone free money at 0%", not just the cronies?

Inherent unfairness?

I remember struggling to answer this point a few days ago, but kind-of blew a fuse trying to figure out fairness. The closest I can get is by talking about expectations.

One thing I can see happening, is that as people learn more about money and politics, their expectations change. They no longer accept a privileged hierarchy of banks making immense profits from debt-based inflation. In people's minds, the ethical or "give and take" expectations become unbalanced (i.e.: the banks don't give anything back in return. They could all be replaced with a benign dictator and a network of post offices). Thus the situation becomes unfair.

However, I don't think it's "inherent" per se.

its "inherent" in the way the system is structured.  why should banks be able to borrow from the Fed discount window at 0% and then turn around and lend that same money to you or i at 4%?  they also create speculative bubbles which blow up and cause all sorts of financial losses for those that get sucked in.

perhaps a different way to say it is why can't i have my own printing press in my garage?  when i screw up with my investments i can just print up some FRN's to bail myself out.  no harm done.   

[FredericBastiat]

If you assume that counterfeiting is not a crime (essentially a free market in patterned print production), then the only concern one should have when dealing with "money stock" is whether the person your contracting with, promises not to inflate nor create/destroy credit in a manner disagreeable to you.

To wit, you either accept the terms regarding the money type, defined by contract (i.e. letters of credit, bills of lading, receipts or equivalents etc.), or you don't. But when things "go south", then you refer to the contract you signed with the person or persons you bargained with, and determine if a fraud was perpetrated (breach of contract).

All things considered, I think most people won't go to such lengths to protect themselves thru contract from unscrupulous "invisible" banking techniques (inflation, credit expansion and contraction issues, fractional banking, etc.), mainly because it's so hard to follow to begin with. And besides, it's also too tempting to want to try to game the system, since you can point the proverbial "finger" at everybody else when it fails.

They will likely just use a form of money like gold and silver bullion, and perhaps bailment thereof, because of the universal difficulty in ability to cheat the system. There is some inflation and accounting problems, but it isn't too bad, which is why gold and silver eventually became the standard in the first place.

[westkybitcoins]

i don't understand why Ron Paul or any defender of a fixed monetary supply like gold or Bitcoin never say that money printing is inherently unfair.  it would be easy to make the argument that inflation or money printing favors the bankers who get first crack at money at 0% and turn around and lend to shleps like us for 4-5%.  how is that fair?

they also turn around and use that free money to drive up their toys like stock and commodity prices to bubble highs before pulling the plug on retail investors who are tempted to get into those same manipulated markets.  this is exactly what we've seen from the bottom 3/09 to now.

a simple argument to someone like Krugman would go like this, "hey, why don't they give everyone free money at 0%", not just the cronies?

Ron Paul didn't actually mention the 0% loan thing (unless I missed it in the crosstalk,) but he kinda did come close. He talked about how the Fed bailed out a bunch of rich people regarding the mortgage crisis, then asked why wasn't the money just given to the mortgage holders (average Joe and Jane) as that would have been far more fair.

[cunicula]

I love this.  Krugman obliterates this dunce.

One can't 'obliterate' a monkey in verbal argument.

[caveden]

i don't understand why Ron Paul or any defender of a fixed monetary supply like gold or Bitcoin never say that money printing is inherently unfair.  it would be easy to make the argument that inflation or money printing favors the bankers who get first crack at money at 0% and turn around and lend to shleps like us for 4-5%.  how is that fair?

But he does. I remember seeing a video of RP saying something as "you're stealing from the poor and the middle class".

Just one thing though: money printing is not "inherently" unfair. It's not unfair if it's voluntary, like gold and bitcoin mining. The actual unfairness is money monopoly.

[finway]

Krugman must be the bitch of the FED.

[cytokine]

I love this.  Krugman obliterates this dunce.

So wait.  You agree with Krugman's theories of economics, but support bitcoin?  Seems to me it should be one or the other.

+1

Bitcoin is the anti-Krugman.

I love how Krugman hates Bitcoin, but there's nothing he can do to stop it.

I can't wait for the likes of him to destroy the USD so the world will suddenly wake up and realize the value of ( and point of ) BTC...

[molecular]

Krugman must be the bitch of the FED.

or both be bitches to the same master

[Synaesthesia]

Paul Krugman used real facts from post-WW2, Ron Paul used spurious historical facts dating from the Romans (!).

Krugman came across as the more rational and calm one.

[westkybitcoins]

Paul Krugman used real facts from post-WW2, Ron Paul used spurious historical facts dating from the Romans (!).

Krugman came across as the more rational and calm one.

Well, how each person looked is probably quite subjective.

To me, Krugman certainly seemed more assertive, but in the somewhat frustrated, hint-of-barely-restrained-anger tone that many intellectually dishonest academics seem to use when their most central beliefs (especially the ones regarding Their Area of Expertise (TM)) are challenged.

Also... "real facts from post-WW2" vs. "spurious historical facts"?... ok....

[P4man]

So wait.  You agree with Krugman's theories of economics, but support bitcoin?  Seems to me it should be one or the other.

And why is that?
You could argue the exact opposite, if you support bitcoin now (and not just in 30 or whatever years), clearly you are in favor of inflation and printing of money.

[Red Emerald]

So wait.  You agree with Krugman's theories of economics, but support bitcoin?  Seems to me it should be one or the other.

And why is that?
You could argue the exact opposite, if you support bitcoin now (and not just in 30 or whatever years), clearly you are in favor of inflation and printing of money.

When I think of bitcoin, I think deflationary even though it is inflationary at the beginning.  I'm thinking long term.  Are you going to abandon bitcoin once the block reward is close to 0 since it seems you prefer inflation?

[P4man]

When I think of bitcoin, I think deflationary even though it is inflationary at the beginning.  I'm thinking long term.  Are you going to abandon bitcoin once the block reward is close to 0 since it seems you prefer inflation?

Ill probably be dead by then. And I guess bitcoin will be too.
But the eventual lack of inflation is not what I see as its strength, I see it as a (long term) problem. Id have preferred a small but predictable inflation rate, but as it is, its not exactly useless, I see bitcoins biggest appeal as a transaction facilitator, to replace or complement paypal, western union etc, but not a store of wealth that will replace fiat currency. Or gold for that matter.

Anyway, thats another topic, just wanted to refute the idea that "supporters of bitcoin" could not possibly share Krugmans idea's.  Economically Im much closer to Krugman than Ron Paul.