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Krugman got Brexit wrong, too
1 Don Surber by Don Surber / 1h // keep unread // hide // preview
President Trump's landslide nomination and his 30-state sweep on the November 8 were not the only things Nobel-winning Paul Krugman got wrong last year.
The New York Times columnist/Princeton professor/Enron adviser also got Brexit wrong, predicting gloom, doom and despair for the United Kingdom after the populists dared vote to leave the European Union.
The day after the vote, King Krugman said Britain would sink into the sea.
From Paul Krugman, PhD, on June 24:
Yes, Brexit will make Britain poorer. It’s hard to put a number on the trade effects of leaving the EU, but it will be substantial. True, normal WTO tariffs (the tariffs members of the World Trade Organization, like Britain, the US, and the EU levy on each others’ exports) are low and other traditional restraints on trade relatively mild. But everything we’ve seen in both Europe and North America suggests that the assurance of market access has a big effect in encouraging long-term investments aimed at selling across borders; revoking that assurance will, over time, erode trade even if there isn’t any kind of trade war. And Britain will become less productive as a result. He is an economist.
According to the brains at the Nobel Prize committee, Krugman is one of the best in the world.
He ended his column:
Where I think there has been real additional damage done, damage that wouldn’t have happened but for Cameron’s policy malfeasance, is within the UK itself. I am of course not an expert here, but it looks all too likely that the vote will both empower the worst elements in British political life and lead to the breakup of the UK itself. Prime Minister Boris looks a lot more likely than President Donald; but he may find himself Prime Minister of England – full stop. So calm down about the short-run macroeconomics; grieve for Europe, but you should have been doing that already; worry about Britain. Six months later, who has the best economy in the world?
From the Times of London:
Britain ended last year as the strongest of the world’s advanced economies with growth accelerating in the six months after the Brexit vote. Business activity hit a 17-month high last month, meaning that the economy grew by 2.2 per cent last year — more than the six other leading nations, including the US, Germany and Japan. Far from slowing after the referendum in June, as predicted by the Treasury and Bank of England, growth appeared to have improved. GDP grew at 0.3 per cent and 0.6 per cent in the first two quarters of last year, compared with 0.6 per cent and an estimated 0.5 per cent in the final period. What the Bigot Krugman called "the worst elements in British political life" turned out to be the saviors of the moribund British economy.
I am so glad Krugman opposed President Trump because that gives me faith that President Trump knows what he is doing. |
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