Always a staunch enemy of the GOP, Paul Krugman’s partisanship has gone into overdrive in the Trump-era to the point where he appears to be suffering from Stage 4 Trump Derangement Syndrome. Even CNN appears tame by comparison.
President Trump has personally blasted the columnist for losing all credibility with his “false and highly inaccurate writings,” and there’s no hyperbole there.
On the night of the election Krugman made his first prediction of what would follow economically – and his predictions have only been downhill from there.
The Stock Market is Doomed Under Trump!
When it became clear that Donald Trump would win the presidential election late into the night on November 8th, the futures market initially panicked, with the Dow Jones shedding over 800 points.
Before the markets even had the chance to open the following day, Krugman took to his New York Times column to predict they would never recover. “It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover? … If the question is when markets will recover, a first-pass answer is never.”
The Dow closed up 250 points the next morning – and you all know what’s happened since.
Admittedly I’m not sure how to calculate the margin of error on the difference between “never” and “the next day.”
Krugman in 2017 – There Will Be No Return to 3% Growth
Appearing on Bloomberg in March 2017, Krugman expressed doubt that we’d be seeing a return to 3% economic growth under the Trump administration.
He reiterated the same point later in the year on Twitter, arguing that it would be difficult to achieve 3% growth due to baby boomers leaving the workforce.
But >3% growth much harder now that baby boomers leaving prime working age instead of entering it pic.twitter.com/dIn4P5XfYH
— Paul Krugman (@paulkrugman) October 29, 2017
Now, the Trump tax cuts didn’t take effect until the start of 2018, and growth was 3.1% from the fourth quarter of 2017 to fourth quarter of 2018. Even more impressive, the economy was only projected to grow 2% according to the baseline under Obama.
A Recession is Coming!
In February Krugman predicted that a recession is coming “this year or next.”
We’ve gone a decade without a recession (which historically occur roughly every seven years), so it wouldn’t be all to surprising if the economy did see a brief recession sometime in the future. But don’t be ready to give Krugman any credit for his predictive ability, because he’s been predicting a recession under the Trump administration every single year of his presidency. Anyone can be a prophet when they make the same prediction every day.
It is worth noting how Krugman has dialed back the severity of his prediction. On election night Krugman predicted that Trump would throw the entire planet’s economy into a recession. He now admits “By the way, my track record for this is bad—as is everybody’s. No one is good at calling these turning points.”
No kidding.
A Historical Comedy of Errors
It’s not just under the Trump-era that the world’s most arrogant economist has butchered his predictions.
In 1998, Krugman dismissed the rise of the internet’s popularity and its eventual economic effects: “The growth of the Internet will slow drastically, as the flaw in ‘Metcalfe’s law’–which states that the number of potential connections in a network is proportional to the square of the number of participants–becomes apparent: most people have nothing to say to each other! By 2005 or so, it will become clear that the Internet’s impact on the economy has been no greater than the fax machine’s.”
Only four years later Krugman came up with a plan to save the economy from the technology bubble which had just went bust – create another economic bubble! “To fight this recession the Fed needs…soaring household spending to offset moribund business investment. [So] Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.” And with that came the worst financial crisis since the great depression.
And that’s not all! In 2010 he predicted that we’d begin experiencing deflation – when in reality we experienced relatively low inflation. In 2008 he predicted that Europe would outperform America economically – and then the financial crisis hit, and Europe was hit far harder than the U.S. (and took much longer to recover from it). On eleven occasions between April 2010-July 2012 Krugman predicted that the Euro would collapse – which obviously never happened.
Next time you see a prediction from the New York Times’ economic expert, be sure to take it with a grain of salt. Or perhaps a pound of salt.
