Yet another Krugman attack column.Random Jottings had already referred to Krugman as "Commissar Krugman" (always a good way of making your point), and this time takes the market fundamentalist position that Hoy was advocating earlier- that "The Market Will Provide" and that accounting practices will "evolve and adapt...grow and flex with the needs of the day". Pity it didn't work in Russia, and pity that this sort of mock "organic" way of describing what is, in essence, a human-built institution only serves to hide any real criticism of government intervention in this case.
I mean, give me a break. It "evolved and adapted" into the current mess it's in right now, didn't it? Evolution is a blind process... who's to say that it simply won't "evolve" into new accounting tricks to fiddle with stock prices that aren't as visible as the ones before? Who's to say that it will "evolve" at all, instead of changing juuust long enough to make investors think that everything is hunky-dory and then nudging things back to the way they used to be, except with less visibility?
He asks: "What would be the state of American capital markets today if GAAP had been written 200 years ago by the likes of Sens. Sarbanes, Levin and McCain?" I don't have an answer to that. Neither does Random Jottings, obviously. The state that they're in right now isn't exactly admirable, though, and the market "evolved" into it, just as the fundamentalists predicted.
Just goes to show: the last thing that market fundamentalists want to learn about is economics. Or, for that matter, evolution.
(This was linked from the Amateur Economist, who appears to be desperately trying to win the contest for "most obsessive Krugman basher". He's got tough competition, obviously, but unlike Hoy appears to avoid that stupid "Enron flack" gambit that hoisted Sullivan on his own petard and unlike Galt isn't trying to establish Groupthink in America. One wonders why they bother- if the columns are as bad as they say, surely nobody is listening, right?)