Mr. and Mrs. Krugman
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February 26, 2010, 12:24 AM
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The New Yorker has a long profile on economist Paul Krugman and his wife.

A reader writes:

Turns out his wife is one of those light skinned black people [blue-eyed and long-haired], not unlike Rev. Wright, who are very angry. In fact, it seems that it was she who pushed him over the edge into becoming the crazy ass conservative hater he now is. Kind of helps explain why he is so obsessed theory that the electoral success of American conservatives since the 70s has been entirely due to racism. (Ross Douthat has the best responses to all this.)

What also stands out from the profile is just how Aspergery the guy is. It`s like he has _no_ idea how actual people work and just doesn`t relate to them.

From Larissa MacFarquhar`s "The Deflationist:"

These days she focusses on making him less dry, less abstract, angrier. Recently, he gave her a draft of an article he’d done for Rolling Stone. He had written, “As Obama tries to deal with the crisis, he will get no help from Republican leaders,” and after this she inserted the sentence “Worse yet, he’ll get obstruction and lies.” Where he had written that the stimulus bill would at best “mitigate the slump, not cure it,” she crossed out that phrase and substituted “somewhat soften the economic hardship that we face for the next few years.” Here and there, she suggested things for him to add. “This would be a good place to flesh out the vehement objections from the G.O.P. and bankers to nationalization,” she wrote on page 9. “Show us all their huffing and puffing before you dismiss it as nonsense in the following graf.”

On the rare occasion when they disagree about something, she will be the one urging him to be more outraged or recalcitrant.

As for Aspergery:

For the first twenty years of Krugman’s adult life, his world was divided not into left and right but into smart and stupid. “The great lesson was the low level of discussion,” he says of his time in Washington. “The then Secretary of the Treasury”—Donald Regan—“was not that bright, and you could have angry exchanges where neither side understood the policy.” Krugman was buoyed and protected in his youth by an intellectual snobbery so robust that distractions or snobberies of other sorts didn’t stand a chance. “When I was twenty-eight, I wouldn’t have had the time of day for some senator or other,” he says.

Krugman’s tribe was academic economists, and insofar as he paid any attention to people outside that tribe, his enemy was stupid pseudo-economists who didn’t understand what they were talking about but who, with attention-grabbing titles and simplistic ideas, persuaded lots of powerful people to listen to them. He called these types “policy entrepreneurs”—a term that, by differentiating them from the academic economists he respected, was meant to be horribly biting. He was driven mad by Lester Thurow and Robert Reich in particular, both of whom had written books touting a theory that he believed to be nonsense: that America was competing in a global marketplace with other countries in much the same way that corporations competed with one another. In fact, Krugman argued, in a series of contemptuous articles in Foreign Affairs and elsewhere, countries were not at all like corporations. While another country’s success might injure our pride, it would not likely injure our wallets. Quite the opposite ...

There are other considerations about why it`s useful to have certain industries and not be wholly dependent upon trade, as Admiral Yamamoto pointed out to the Japanese Imperial Council in 1941 and Rhett Butler to the firebreathers at the barbecue in 1861:

Certainly until the Enron scandal, Krugman had no sense that there was any kind of problem in American corporate governance. (He consulted briefly for Enron before he went to the Times.) Occasionally, he received letters from people claiming that corporations were cooking the books, but he thought this sounded so implausible that he dismissed them. “I believed that the market was enforcing,” he says. “I believed in the S.E.C. I just never really thought about it. It seemed like a pretty sunny world in 1999, and, for all of my cynicism, I shared a lot of that. The extent of corporate fraud, the financial malfeasance, the sheer viciousness of the political scene—those are all things that, ten years ago, I didn’t see.”

That finally makes sense out of what turned into a bizarrely acrimonious email exchange I had with Krugman around 1999. He said he was working on the perennial conundrum of why ticket prices for rock concerts tend to be set so low that they immediately sell out and then are resold at a sizable profit for market-clearing prices by brokers. Why wouldn`t the promoter take a larger profit? (By the way, I noticed in the New Yorker profile that 1960s-1970s rock music comes up a lot in his conversation, so this would be a natural topic for him to muse upon, and our experiences with rock concert tickets would come from similar periods. I don`t know much about rock concert ticket prices in recent years — it seems like the Ticketmaster monopoly now absorbs a big chunk of the profit.)

I pointed out to Krugman that maybe the insiders actually are reaping more profits than it might seem from the face value printed on the tickets. Why assume that all the tickets being resold for higher prices on the gray market were necessarily first sold to the public for face value?

Friends who had camped out outside the box office and been first in line for Springsteen tickets in LA in 1980 or 1981 had been shocked to discover that the first ten or so rows were already gone before sales to the public (i.e., them) began. (There was even an LA Times article at the time about how the skimming of low face value Springsteen tickets for resale to Hollywood bigshots had gotten out of hand.) They told me that their usual experience with hockey rink concerts was that insiders glommed on to the best seats before public sales began, and then resold them on the gray market for big profits.

So a substantial bit of the profit from being in the impresario and ticket sale business came from cheating the public on promises of first come-first serve sales. A lot of tickets "fell off the back of a truck" before any were offered to the poor schmoes who had been camped on the sidewalk. This provided a source of unreported tax-free compensation for insiders from promoters down to ticket clerks. It doesn`t have to sound sinister at all — you could let your ticket clerks know that they could buy up to X number of tickets at face value in the best seats in the house before accepting orders from the people in line. Of course, you could then pay them lower wages because of this perk, and lower payroll taxes, too. Everybody wins!

In contrast, if the promoter boosted the face value of the tickets to the market clearing prices, the band and the taxman would get most of the benefit. You could wheedle well-meaning musicians, such as Springsteen in 1980, into accepting the low face value prices as doing something for the average fan who can`t afford high ticket prices.

Hence, the net behavior of the insiders was more profit-maximizing than it would seem on the surface.

Maybe I was right, maybe I was wrong, but this seemed to me to at least be an idea worth considering. Krugman, however, angrily rejected my suggestion. He was offended by it.

I can see from this article that it just didn`t fit into what he then considered proper economic theory. We have this beautiful theory of economic actors — individuals, firms, governments — and the notion that individuals within firms, whether concert promotion firms or Enron, might be playing a double game just complicates this beautiful picture too much.

So, Krugman`s wife has merely channeled his inner anger toward Republicans and away from his old target—people with the temerity to think about economics without using equations. I can`t say that`s such a bad thing that she`s done. Krugman`s new hobby, denouncing Republicans, is better for society on the whole than Krugman`s old hobby: denouncing thinkers outside the inner circle of mathematical economists.

(Granted, some of the non-math thinkers Krugman used to denounce, such as Stephen Jay Gould, deserved denouncing.)

Last August, Krugman decided that before he and Wells departed for a bicycle tour of Scotland he would take a couple of days to speak at the sixty-seventh world science-fiction convention, to be held in Montreal. (Krugman has been a science-fiction fan since he was a boy.)... Krugman explained that he’d become an economist because of science fiction. When he was a boy, he’d read Isaac Asimov’s “Foundation” trilogy and become obsessed with the central character, Hari Seldon. Seldon was a “psychohistorian”—a scientist with such a precise understanding of the mechanics of society that he could predict the course of events thousands of years into the future and save mankind from centuries of barbarism. He couldn’t predict individual behavior—that was too hard—but it didn’t matter, because history was determined not by individuals but by laws and hidden forces.

With economists, it`s usually Foundation or Atlas Shrugged, not Chekhov.