The New York Times allowed Matthew Bishop to write its review of Paul Krugman’s new book, End This Depression Now! Mr. Bishop is The US Business Editor and New York Bureau Chief of the Economist, a very serious paper. Mr. Bishop himself is a Very Serious Person, although he doesn’t seem to understand the point of that term, and he takes umbrage:

Yet no opportunity to preach to the choir is missed by the populist Mr. Krugman, nor any chance to mock those he calls the “Very Serious People” who disagree with him.
…
To this Moderately Serious Reviewer, Krugman’s habit of bashing anyone who does not share his conclusions is not merely stylistically irritating; it is flawed in substance.

Mr. Bishop noticed that Krugman doesn’t give any credence to the economic theory created by public relations flacks for the billionaire consensus, that the problem is lazy overpaid over-pensioned incompetent US workers who immorally refuse to pay their debts to their betters. Certainly the problem isn’t the lazy writers hired by the pretend meritocracy, who faithfully reproduce that nonsense in dressy faux-British prose to justify the self-satisfaction of the 1%.

The few substantive comments put forward by Mr. Bishop are thoroughly trashed by Jared Bernstein, among others; so let’s move on to Mr. Bishop’s other big problem with the book:

Maybe his case for stimulating the economy in the short run would be taken more seriously by those in power if it were offered along with a Bowles-¬Simpson-style plan for improving America’s finances in the medium or long term.

Mr. Bishop thinks that Krugman is solving the wrong problem: it isn’t massive unemployment that is wrecking the country, it’s the long-term possibility that increased national debt might lead to increased inflation or taxes on the rich. It’s the mere possibility that some of the loss from the Great Crash might fall on the guilty elites instead of the rest of us.

Mr. Bishop can’t stomach Krugman’s mocking tone, his insolence towards his wealthy betters. Krugman is betraying his social class, appealing over their heads to the “informed public” (scare quotes are Mr. Bishop’s). Well, Mr. Bishop, democracy is not just another piece of pretense from the oligarchy, which the insider Krugman should pretend to accept while making his case to his superiors in one of those quiet rooms they approve.

Even Jared Bernstein thinks Krugman should do something else:

Instead, I’d urge [Krugman and Joseph Stiglitz] to think more about real politics and how to get out of this mess given the stark realities of political dysfunction.

Meaning no disrespect, I ask Bernstein how that worked out for him? Or for Christy Romer? They both failed at insider politics. Politics is not a meritocratic game, where the best argument and the best evidence lead to the best conclusions and actions anymore, if it ever was.

People who say this out loud are generally ignored by the likes of Mr. Bishop, and if they have enough clout to get that view out in the public sphere, Mr. Bishop inspects his bank balance and lets fly with all the supercilious disdain he learned at the feet of the Economist editors.

Krugman played their game. He spent the first years of the Obama administration putting his ideas into his economic papers and conference presentations in measured, professorial terms, and using his column to call attention to those ideas. His results are no better than Bernstein’s, though the fact that they are public at all is an affront to Mr. Bishop.

Suck on this, Mr. Bishop. You are arguing in bad faith, and your weekly rag is too. Neither of you are interested in the evidence or the logic of the argument. You aren’t even interested in the favorite of conservatives, the argument from authority: Krugman is a Nobel Prize winner and has big space in for the New York Times, and he was right and you and your clients were wrong about everything. You don’t care that he is an independent writer and professor while you work for the interests of the rich.

Your reporting conceals the real problem facing this country: the dominance of the rich, the elite, the lords of finance, the owners of dressage horses and Brawny Paper Towels. They don’t want to eat their losses. They want the middle class to pay those losses. What’s your solution to that problem?

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Edited to delete incorrect reference to date of Krugman’s Nobel Prize.

Matt Bai apparently plans to remain perfectly ignorant about Social Security and the Social Security Trust Fund. First he wrote this piece for the New York Times, in which he mingles his wrong-headed ideas with quotes from Earl Blumenauer in a way that makes it look like the mild-mannered long-term Congressman from Portland agreed with him. Blumenauer was forced to issue a denial. When asked about it by reader english444, who correctly describes the situation, Bai doubled down on his ignorance:

Well, this topic did come up a lot, and I’m not looking to get into a whole new debate about it here. But the most credible experts I’ve talked to believe we need to draw a distinction between principle and reality. The principle to which you’re referring is that the government guaranteed all of this Social Security surplus money (which it spent) with Treasury Bills. The reality is that redeeming that trillions of dollars in debt would require issuing trillions more in debt. Now, if deficits are low and the national debt is manageable, that’s not such a huge deal. But given the projections for the next few decades (the national debt could reach 90 percent of GDP by 2020, which puts us in Greece territory), issuing that kind of debt would still entail some serious budget cuts, either in Social Security or other social programs, or a sharp rise in taxes. The longer we postpone this debate, the more draconian those measures would likely be.

Now, I can sympathize with the view based on principle, but I can’t really understand why introducing the pragmatic side of this, as I did, is somehow immoral or requires my having some sinister “agenda.” And I find it amusing that it tends to be boomers — whose generation happily spent all this money and who are now collecting their full Social Security benefits — who do most of the lecturing about the sanctity of the trust fund. But that’s a discussion for another day.

Bai needs to learn the basics before he starts relying on anonymous “most credible experts”. Here’s a starting place: the US Treasury website that gives the national debt to the penny every day. At September 21, the total public debt outstanding was $13.477 trillion. The GDP can be found on here, Table 3 (.pdf). At June 30, 2010, the estimate is $14.575 trillion. That puts US debt at 92.5% of GDP, or as Bai would say, into Greece territory. In May, 2010, the debt-GDP ration of Greece was about 115%.

As Dean Baker has repeatedly tried to explain, most recently here in response to Bai, bonds are easy to understand. I lend you money. You spend it. Then you start paying me back. There is nothing nefarious about this process. Baker speculates that Bai may be arguing that the Treasury should default on some of that debt. That will cause some heartburn at the FDIC, because it invests in Treasuries. In fact, at May 31, the FDIC held $38.531 billion of that kind of debt, just in case some bank might fail.

It would also anger baby boomers, whose Social Security Bai wants to cut after they paid $2.54 trillion into the Trust Fund. Bai thinks they should just shut up, because it’s all their fault. Actually, of course, it’s the “fault” of a completely different group of people. The same failed economists who promised that cutting taxes for the very rich would raise total tax revenues were the people who in 2001 told Congress that it was a bad idea to run surpluses, I’m looking at you, Alan Greenspan. There wouldn’t be an issue if not for the ludicrous Bush tax cuts. Our borrowing capacity would easily absorb the tiny amount of money needed to fund Social Security.

The people who are collecting Social Security today include a few baby boomers, but mostly it’s our parents, and I don’t know about you, but I’m glad they will be able to live on their own.

To top it off, actual credible economists like Paul Krugman at Princeton and the NYT, and James Horney of the Center on Budget and Policy Priorities, don’t agree with Bai’s theory that bad things happen when debt hits 90% of GDP, or that the correct measure excludes intra-governmental debt.

Mr. Bai, tear down that wall of secrecy and put some names to those “most credible experts”. Or admit that you are just repeating the latest whispers from the Catfood Commission and its servile staff minions, or some other tool.