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The 2005 Jayson Awards
. . . with your "Krugman-stalking" host, Don Luskin!


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Donald L. Luskin

Welcome, ladies and gentlemen, to the first-ever Jayson Awards! It’s a glittering gala of gotchas, as we recognize Paul Krugman’s most egregious (or just plain hilarious) lies, errors, distortions, misquotations, and embarrassments in six categories. Winners will all receive their choice of any one Krugman Truth Squad logoed product from our online store.

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It was a real challenge to pick the winners — the best of Krugman’s worst — because America’s most dangerous liberal pundit has produced an unprecedented wealth of partisan sleaze. And after writing the Krugman Truth Squad column for more than two years, I really thought I’d seen it all. But thanks to the almost two hundred readers who submitted nominations, the 2005 Jaysons recognize a great selection of not only familiar classics, but also some brand-new never-before-seen Krugman howlers.

Our first Jayson is given in the category of Shaping, Slicing, and Selectively Citing Numbers — Krugman’s “disturbing habit” according to former New York Times “public editor” Daniel Okrent.

The envelope please. … And the winner is … David M. Kiriazis, chairman of the economics department at Frostburg State University in Frostburg, Maryland, for the terrific example of statistical sinnuendo that he uses in his Principles of Economics class as an example of what not to do. In a March 12, 2004, Times column, Krugman wrote:

But wait — hasn’t the unemployment rate fallen since last summer? Yes, but that’s entirely the result of people dropping out of the labor force. Even if you’re out of work, you’re not counted as unemployed unless you’re actively looking for a job.

But as Prof. Kiriazis explains,

Unless nothing else changed, a decline in the unemployment rate could not possibly be explained “entirely” by people dropping out of the labor force. In fact, from June 2003 to Feb 2004, the labor force did decline from 147 to 146.5 million, but the number of unemployed declined from 9.2 to 8.2 million. Hence, the decline in the unemployment rate was mainly the result of more people finding jobs.

By the way, I specifically corresponded with both Okrent and Times editorial-page editor Gail Collins about this episode, and was “entirely” stonewalled by both. Collins blew me off by sniffing, “I’ve discussed your objections with Paul Krugman and am convinced that everything he wrote was well within the realm of acceptable opinion writing.”

Our second Jayson is for the category of Biggest Howler (Political). And the winner is … Jeffrey Gepner, who submitted Krugman’s Times column from election morning last November. Believing — along with the rest of the media — that John Kerry would win the presidency, Krugman rhapsodized,

I always get a little choked up when I go to the local school to cast my vote. The humbleness of the surroundings only emphasizes the majesty of the process: this is democracy, America’s great gift to the world, in action. … Those people still believe in American democracy; and because they do, so do I. … it’s already clear that the people of Florida — and, I believe, America as a whole — have refused to give in to cynicism and spin.

… Regular readers won’t be in any doubt about who I want to win, though New York Times rules prevent me from giving any explicit endorsement. (Hint: it’s the side that benefits from large turnout.)

Needless to say, Krugman’s not feeling quite so rhapsodic lately. In a Times column three weeks ago he had this to say about “America’s great gift to the world, in action”:

the national election was about who would best defend us from gay married terrorists.

The runner-up in this category is Jeffrey Trimarchi, who submitted Krugman’s Times column of January 2, 2004. Back then, Krugman was furiously supporting the candidacy of Howard Dean (who had publicly said that, if elected, he would name Krugman as his “foremost economic policy advisor”). Urging John Kerry to get out of the race and make way for Dean, Krugman claimed the Kerry campaign had “imploded,” and clucked,

This is no time for a candidate who is running just because he thinks he deserves to be president.

Our third Jayson is for the category of Biggest Howler (Economics). And the winner is … Max Pappas, who has unearthed a hitherto unknown statement by Krugman. In the December/January 1996-97 issue of Boston Review, Krugman — today a rabid defender of the Social Security status quo and an opponent of “privatization” — not only admits that there is a crisis, he comes out in favor of personal accounts:

I like [Richard] Freeman’s idea of providing each individual with a trust fund when young rather than retirement benefits when old, but we had better realize that this is a significant change in the character of the social insurance system … Well, the Ponzi game will soon be over, thanks to changing demographics, so that the typical recipient henceforth will get only about as much as he or she put in (and today’s young may well get less than they put in).

By way of contrast, runner-up Chris Braaten submitted a January 2005 interview in Rolling Stone in which Krugman had a very different message for “today’s young.” On personal accounts, Krugman stated,

We’ll have more suffering and bigger bills. People will ask: Where did all that money go? The answer will be: It basically went into mutual-fund fees.

Our next Jayson is for the category Worst Prediction. And the winner is … Jon Henke of the Questions and Observations blog, who found this hysterically bad prediction in a 1998 Krugman article called, ironically, “Why Predictions Are Wrong.” Krugman wrote,

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.1997, which was a good year for worker productivity, has led many pundits to conclude that the great technology-led boom has begun. They are wrong. Last year will prove to have been a blip, just like 1992.

Here’s a graph showing nonfarm business output-per-hour, direct from the website of the Department of Labor. As you can see, productivity launched into its greatest-ever sustained period of growth right after that “blip.” Better send a fax to Krugman about that (in case he doesn’t have an Internet connection).

The next Jayson is for the category of Funniest Inadvertent Confession. And the winner is … Paul Kane, who resurrected Krugman’s Times column of April 23, 2000, aptly titled “How to Be A Hack.” In a discussion of the economic “hired guns” who “roam in packs” in Washington, he describes how to identify one, writing,

he has learned that pretty good jobs in think tanks, or on the staffs of magazines with a distinct political agenda, are available for people who know enough economics to produce plausible-sounding arguments on behalf of the party line. Ask him whether he is a political hack and he will deny it; he probably does not admit it to himself. But somehow everything he says or writes serves the interests of his backers … there is another telltale clue: if a person … always sings the same tune, watch out.

And here’s some advice for the Krugman Truth Squad:

Hack jobs often involve surprisingly raw, transparent misrepresentations of fact: in these days of search engines and online databases you don’t need a staff of research assistants to catch ‘em with their hands in the cookie jar.

We couldn’t agree more, Paul!

The runner-up in this category is Jimmie Bise, Jr., who found this confession in a 1998 Fortune column — something it’s taken a frustrated Dan Okrent all these years to figure out:

My record as a forecaster is far from perfect, but I’m very good at explaining my mistakes.

Our final Jayson is the N. Gregory Mankiw Award for Excellence in “Just Making Stuff Up.” And the winner is … Jim Glass of the Scrivener.net blog. Glass submitted Krugman’s Times column of January 28, 2005, in which Krugman utterly invented out of whole cloth the mortality statistics required to prove that African Americans don’t get a bad deal from Social Security. Refuting a statement by President Bush to the effect that shorter life expectancies mean that African Americans don’t collect as much in Social Security benefits as whites, Krugman wrote:

It’s true that the current life expectancy for black males at birth is only 68.8 years — but that doesn’t mean that a black man who has worked all his life can expect to die after collecting only a few years’ worth of Social Security benefits. Blacks’ low life expectancy is largely due to high death rates in childhood and young adulthood.

Glass demolished this by going to life-expectancy data from the National Center for Health Statistics. Writes Glass,

We find that black males right in the middle of a working life, age 40, have a 30% chance of dying by age 65. (The corresponding chance for white males is 17%.) … Black males alive at age 5 have only a 3% chance of dying within the next 25 years of their childhood and young adulthood, by age 30. (For white males the figure is 1.9%.)

So their death rate during their past-age 40 working years is 10 times higher than “the high death rates in childhood and young adulthood” Krugman ascribes to them. And the risk that a black male age 40 will die before reaching the Social Security retirement age of 65 — after paying [payroll taxes for most of his] working life [and being] still too young to recover any of them — is 10 times higher than the risk that one will die as a child or young adult age 5 to 30. (And 77% higher than the risk that a white male age 40 will die by age 65.) Krugman … claimed exactly the opposite.

Six categories, and regrettably only six Jayson winners. Thanks again to all the readers who submitted terrific nominations. And especially to the bloggers of the Krugman Truth Squad who, as always, came up with so many great ideas. Be sure to visit Just One Minute, Man Without Qualities, Lying in Ponds, Eidelblog, Econopundit, and Tim Worstall for more prime Krugman gotchas.

– Donald Luskin is chief investment officer of Trend Macrolytics LLC, an independent economics and investment-research firm. He welcomes your visit to his blog and your comments at [email protected].



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