This morning while driving to work I heard a snippet from a Paul Krugman interview. One of his comments (in reference to the Bernanke press conference) perked my interest. I don’t recall the exact words, but he said something to the effect of:
BTW, I think that I am doing him [Bernanke] a favor . . .it allows him to push back against criticism he’s been receiving from the right.
If someone finds a transcript I’d be glad to correct the quotation. This reminded me of what I wrote just yesterday:
Without the criticism of Bernanke from us market monetarists, and without the criticism of Bernanke from Krugman, DeLong, Avent, Yglesias, Duy, Thoma, etc, etc, Ben Bernanke’s job would be much harder. Without that criticism, all the pressure on the Fed would be coming from the right, and would be pushing the Fed in exactly the opposite direction from where Bernanke would like to go. We are helping him, whether he knows it or not, and regardless of how annoying he finds our criticism.
I’m tempted to say “great minds think alike,” but perhaps that would be presumptuous until I win my Nobel Prize. Seriously, I wonder if he read my post, or if it’s just a coincidence.
He also pointed to all the jobs we could get from fiscal stimulus; 1.3 million to be precise. He didn’t mention that the Fed policy he criticized (which is basically “QE2 raised core inflation to 2%, and we’re damn well going to keep it right there.”) would trim a few jobs off that estimate. Indeed about 1.3 million jobs to be precise.
PS. I’m getting a lot of push back from commenters that I am being naive in assuming that Bernanke is secretly a good guy, who actually wants the Fed to do more. I’m not sure my view is a compliment, but let’s assume it is. Krugman said basically the same thing in the interview. Here’s another way of putting it: Take the Fed forecast of NGDP growth over the next couple of years. Say it’s 4.5%. Now give Bernanke truth serum. Ask him if given his druthers, he’d prefer the actual rise of NGDP to be 4.5% or 4.7%. I’m almost certain I know the answer. That’s all I’m saying.
PSS. ‘Druthers’ is kind of a strange word, isn’t it?