Nobel Prize Winner in Economics Ignorant of Economics

Paul Krugman has decided that since there is not much price inflation, that actual inflation - that is an increase in the money supply - has not had a negative impact on consumers. What he fails to realize is that the inflation of the money supply has kept prices from deflating, which would be the necessary correction for the previous bubble. The current inflation of the money supply will only lead to another bubble (probably in real estate again or green boondoggles) and subsequent bust. His philosophy is to continually push the reckoning down the line to be finally settled by some future generation.

Nobel laureate in Economics Krugman also shows his lack of economic understanding by advocating that government mandated/provided health insurance would be a good thing:

Sky-high rate increases make a powerful case for action. And they show, in particular, that we need comprehensive, guaranteed coverage — which is exactly what Democrats are trying to accomplish.

The law of supply and demand escapes him:

What would work? By all means, let’s ban discrimination on the basis of medical history — but we also have to keep healthy people in the risk pool, which means requiring that people purchase insurance. This, in turn, requires substantial aid to lower-income Americans so that they can afford coverage.

Since he can't reconcile his liberal fantasy land with reality, Krugman simply throws the laws of economics out the window. How can you reduce cost by increasing demand, while simultaneously shrinking supply? The current glut of comprehensive policies along with Medicaid and Medicare encourages people to go to the doctor for the sniffles. Imagine the waiting rooms when everyone has this coverage. The current medical resources will become grossly inadequate and the price controls and regulations that will have to be implemented will discourage expansion of the supply of medical professionals and equipment.

Krugman also promotes price controls on energy in the future, because there was a bubble in oil. Again, the concept of supply and demand is beyond his grasp. When the economy is at full capacity and requires large amounts of energy, and governments make it difficult to maximize the supply of energy, this can only lead to higher prices. Couple this with price controls and the supply will shrink rapidly as demand sky rockets. Without the ability to adjust prices upward, suppliers will not provide any supply. Which leads to Krugman's ultimate egalitarian fantasy where we all wallow in our own filth, all equally miserable.

Besides being impractical, Krugman's philosophy is immoral. He would shackle those who produce into indentured servitude to the weak, helpless, lazy, inept and foolish. Laissez-faire capitalism is always the answer to the problems of modern society, not because it works, not because it lifts people out of poverty, and not because it improves the lives of everyone, rich and poor alike, but because it is the only moral social system that exists, where men must trade with each other voluntarily, value for value, with a government doing nothing but protecting the individual from the force and coercion of those who want what they haven't earned.