Friday 26 September 2003

Scotland needs Mises and Rothbard not Krugman and Keynes

The Scotsman tells us that Wendy Alexander, former Enterprise Minister and Scotland's best-known MBA, has organised a programme of lectures designed to boost our economic growth rate:
The speakers, dubbed the "Real Madrid" of economists, will include William Baumol, an emeritus professor of economics at Princeton University, Paul Krugman, an economist and commentator, James Heckman, a winner of the Nobel prize for economics, and Ed Glaeser and Nicholas Crafts, both from the UK.
If these guys are the "Real Madrid", then Paul Krugman is the David Beckham of the team, at least in terms of his media stardom. But can Krugman score for Scotland? I suspect not. The only economics that makes sense is that of the "Austrian School" whose intellectual base is now at the Mises Institute.

They are expert Krugman watchers:

That truly great economic journalist, Frédéric Bastiat, who saw the first waves of socialist humbug sweeping across Europe in the late 19th century, wrote, responding to the Paul Krugmans of his day: "We disapprove of state education. Then the socialists say that we are opposed to any education ... We object to a state-enforced equality (of rights). Then they say that we are against equality ... It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain."
And:
At root, Mr. Krugman's crusade is one of envy. He parodies his opponents, ignores arguments that undermine his thesis and accuses anybody who does not agree with him of being "fanatical," brainless, hard-hearted or a liar.
He sounds just like a member of Ms Alexander's Scottish Labour Party.

The Scotsman's Bill Jamieson has some idea of what is wrong:

Today, we enjoy (sic) a rising level of government spending and a growing dependence on government in all its forms. Only one thing is wrong. The heart of Scotland’s economy has ceased to beat.
Writing to me about Jamieson's commentary, Andrew Duffin says:
As long as most of our people think the state is the solution, Scotland will continue to fail. Once they realise that the state is the problem, we can start to put things right.
I don't expect that's what Krugman will be telling us.