Marches of the Non Sequitur

I really was ready to shout, "Hallalujah!" when I saw the title of Paul Krugman's latest column on the 10-year anniversary of the U.S. invasion of Iraq. When I met Krugman in 2004 at the Southern Economic Association meetings in New Orleans, we were discussing Iraq and I told him that I was afraid we would live the results of that war for the rest of our lives, and he agreed. I hated the war then and always will hate what the U.S. Government has done there.

Had he left things at that, I would have written a post filled with hosannas for Krugman's good judgment. Alack and alas, The Great One was using Iraq as a warmup for claiming that since the war was bad and the media did a terrible job in dealing with it, then any media criticism of the current federal budget deficit also is bad. Don't you get it? Media wrong then; therefore, media wrong now.

This is what the ancients once called the non sequitur (Latin for "it does not follow") in which the conclusion is not supported by the premises. If Washington was "wrong" on Iraq, then Washington certainly must be "wrong" on anything regarding the federal budget. Everyone knows that!

Even beyond Krugman's logical fallacy, there is another problem with his argument: Washington hardly is a place where "austerity" is being practiced, much less preached. The Republicans hardly were "austere" during their days of controlling all branches of the federal government and when people talk of "draconian budget cuts," they really are referring to alleged "cuts" in the INCREASE of spending. In other words, any slowdown in the rate of increase in spending is termed "austerity" by people who should know better.

Then there are statements like the following in which Krugman wants to claim that the mainstream media is on the side of "austerity":

...now as then we have the illusion of consensus, an illusion based on a process in which anyone questioning the preferred narrative is immediately marginalized, no matter how strong his or her credentials. And now as then the press often seems to have taken sides. It has been especially striking how often questionable assertions are reported as fact. How many times, for example, have you seen news articles simply asserting that the United States has a “debt crisis,” even though many economists would argue that it faces no such thing?

To be honest, I cannot recall reading anything recently in the mainstream press recently that referenced a "debt crisis." However, I would add that the U.S. Government is not paying its debts via any methods other than financial trickery, something that cannot continue forever without serious consequences. The U.S. Government pays its debts either by borrowing more money or essentially printing the payments, neither of which is sustainable.

No, we are not in a current "debt crisis," as one might define the term. Not even the Austrians are making that claim. The Austrians do say, however, that the real financial damage that the government and the Federal Reserve System has been doing is not going to have a happy ending. Krugman and his True Believers may believe that printed money essentially is real wealth (and that ultimately is what they are claiming), but the laws of economics have a way of making themselves known, and there will come a time when Ben Bernanke has no more rabbits to pull out of his hat.