Sunday Times: Ferguson vs Krugman in intellectual punchup over economy

One of them is a “poseur”. The other is “patronising”. One suffers from “verbal diarrhoea”. The other is a “whiner”.

A bust-up on the set of High School Musical 4 perhaps? A scrap behind the catwalk at a Milan fashion show? No. Those accusations were slung round in an increasingly bitter public row between two of the world’s most distinguished commentators on global finance and economics, professors Paul Krugman and Niall Ferguson, of Princeton and Harvard, respectively.

It started as an argument about bond prices. But last week it blew up into a row about racism, printing money, spending our way out of recession, and the fate of the global economy.

Academic spats can, of course, be famously catty. Ludwig Wittgenstein once tossed a poker at his fellow philosopher Karl Popper at a meeting of the Cambridge Moral Science Club as they argued about whether issues in philosophy were real or just linguistic puzzles. At least Krugman and Ferguson haven’t come to blows yet, although at their next meeting it might be better to hide the blunt instruments. Still, it is a long time since the academic world witnessed a dispute as gladiatorial as this one.

Henry Kissinger, who knows a bit about fights, both political and intellectual, once observed that the reason academic tussles were so vicious was “because the stakes are so small”. And although that is true in one sense — it doesn’t matter very much whether the professor from Princeton doesn’t like his rival from Harvard — it is wrong in another. The stakes in this row are pretty high.

The argument is about whether the huge stimulus programmes launched by governments around the world, and the way central banks are furiously printing money, are lifting the global economy out of recession. Or whether they are just teeing up the next crisis — hyper-inflation and an even worse economic collapse.

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