This is another state of the Krugman post. You and I, flies on the insider walls, know that Ben Bernanke is a full professor at Our Betters U. — in other words, deeply involved in running his chunk of the State for the lords and ladies who govern us. Like all retainers Bernanke works for a living, but as Chairman of the Fed he's very high up.
Paul Krugman is now acknowledging the same thing, and becoming less and less collegial in the process. Why do I say "less collegial"? Because Krugman and Bernanke are fellow academics; in fact, Bernanke used to be Krugman's boss at Princeton.
As you read the following, remember that the Fed has twin legal mandates — low inflation (for the money crowd) and low unemployment (for the masses). In reality, of course, the Fed works only for the money crowd, keeping their pockets lined.
Krugman recently called him on that in the magazine piece linked below, and Bernanke has responded. As Krugman tells the tale [bracketed inserts mine]:
Ben Bernanke responds to my magazine piece; as I see it, in effect he declared that he has been assimilated by the Fed Borg:In other words, Bernanke is saying, Why trade a known-bad like inflation for something as ephemeral as improved employment? After all, my friends are fully employed right now.I guess the, uh, the question is, um, does it make sense to actively seek a higher inflation rate in order to, uh, achieve a slightly increased pace of reduction in the unemployment rate? ...Notice the framing — “a slightly increased pace of reduction in the unemployment rate”. It’s basically an assertion that we’re doing all right[.] ... Disappointing stuff.
To risk that asset [by "asset" he means "low inflation," though he's actually referring to the money crowd's well-lined pockets], for, what I think would be quite tentative and, uh, perhaps doubtful gains [by "gains" he means "work and food for the masses"], on the real side would be an unwise thing to do [because the world is ruled by "wisdom" and not, say, "greed"].
So much for Bernanke. But again, this post isn't about the Ben — he's a known made man already. This is about the Krugman, who dares to say so using his Times blog-inches.
Thanks, Professor. And welcome. Soon you'll be as radical as you were in 2003, when Bush was king and we were still naïve.
(To follow on Twitter or to send links: @Gaius_Publius)