Dear Monetary Policy Observer,
Paul Krugman v. David Stockman: The Great Debate Over Gold Continues
Amid an ongoing decline in the price of gold, a major brawl recently broke out in the elite media over … the gold standard. What is this free-for-all all about? And why does it matter? It matters because… the gold standard finally has demonstrated that, after a long eclipse, it is being taken seriously in elite (if not uniformly polite) company.
Paul Krugman, in a blog entitled Cranky Old Men, attacked a Sunday New York Times jeremiad by former OMB Director David Stockman. Stockman’s tirade, in fact, was more reminiscent of Allen Ginsberg’s Howl — “who burned cigarette holes in their arms protesting the narcotic tobacco haze of Capitalism … Moloch! Solitude! Filth! Ugliness! Ashcans and unobtainable dollars!” — than of an op-ed
And yet, Krugman’s response possessed all the persuasive power of a 14-year-old’s sarcasm: “It’s cranky old man stuff, the kind of thing you get from people who read Investors Business Daily, listen to Rush Limbaugh, and maybe, if they’re unusually teched up, get investment advice from Zero Hedge. Sad.”
Matthew O’Brien of the Atlantic Monthly, playing Robin to Krugman’s Batman, botched a rescue operation. O’Brien got his facts badly wrong and came across as a propagandist, or apologist, rather than a serious analyst. O’Brien concluded, in The Atlantic Monthly, that “The gold standard didn’t save us from dystopia. The gold standard was dystopia.” Wrong. O’Brien was called out by the centrist Bloomberg and the center-right Forbes.com, his reputation bruised, for concocting a counterfactual counter-narrative.