Earlier today, Paul Krugman demanded an apology from Andrew Ross Sorkin for Sorkin’s column saying that, during the financial crisis, Krugman had advocated nationalization of the entire banking system.
That is not what we remembered Krugman saying, and it’s not what Krugman remembered Krugman saying. And Krugman said so.
So we expected that Sorkin would quickly be forced to apologise and grovel for forgiveness, especially after Joe Weisenthal trolled through some Krugman archives and found examples of Krugman advocating only a temporary takeover of some insolvent banks.
Sorkin went bank to his own trove of Krugman posts and found sentences that (almost) support his characterization of what Krugman was advocating:
On your blog on Sept. 28, 2008, after reading a piece by Brad DeLong, an economist, which you linked to, you wrote, “Brad DeLong says that Swedish-style temporary nationalization is the right answer to a financial crisis; he’s right.”
In your column on Feb. 23, 2009, you asked, “Why not just go ahead and nationalize? Remember, the longer we live with zombie banks, the harder it will be to end the economic crisis.”
And Sorkin did NOT apologise.
But should he have?
Yes, he should have.
It’s a fine line, but as far as we can tell, he overstated the case. As far as we know, Krugman never recommended “nationalizing the entire banking system,” which is what Sorkin said he said. And Sorkin is definitely smart enough to see the difference between temporarily seizing and restructuring a few insolvent banks and nationalizing the entire system.
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