Congratulations on your well-earned Nobel prize.
I was heartened recently to read your column, “Life Without Bubbles” — not by the part where you write, “we’re in for months, perhaps even a year, of economic-hell,” which is just acknowledging the depressingly obvious, but by your assertion that “Late next year the economy should begin to stabilize, and I’m fairly optimistic about 2010.”
In dire need of some positive news, of something to look forward to, I seized on that “fairly optimistic” line as many others have done in the week since you published it, despite its vagueness, its throwaway nature, and the fact that it’s mostly beside the point of your article.
But then I thought, “Hmm. Suppose I were Paul Krugman, Nobel-prize winning economist and one of the best-known, most well-respected voices on current affairs. Suppose I knew the basic fact of economics that the public’s collective confidence in the economy is self-fulfilling: when people are optimistic about the future, by and large the economy improves; and even more certainly, when they’re pessimistic, it deteriorates. And now suppose that I, Paul Krugman, believed that things were going to get bad, really bad, for a long time — Weimar Germany bad. Would I tell it like it is — and knowing my own influence, be responsible for the resulting nosedive in public confidence and the economic ruin it would cause? Or would I feel a responsibility to say something positive even if I didn’t really believe it?”
So I’m having trouble knowing whether you’re sincere, or whether you’re secretly with Roger Ebert and just not able to express your sense of doom without hastening it.
Don’t bother replying. If you would write that you were really being sincere, I won’t know whether to believe that and we’ll be right back where we started. But if you would admit that you were being unsupportably rosy in an effort to delay the inevitable, that’s something I’d just rather you not say in public.
Whistling in the dark,