Paul Krugman,ever the populist,has now jumped into the Hall fray ( read Rewarding Bad Actors NYT Aug.2,2009 ).In his editorial,Professor Krugman fires a broadside against Goldman Sachs’high frequency derived profits and against Mr.Hall.Arguendo,one might find high frequency trading to be reprehensible because those with higher speed computers are said to have an unfair advantage over the Lumpenproletariat whose computers dawdle along at much lower speeds.To condemn Mr.Hall,Professor Krugman then argues: »What about Mr. Hall? The Times report suggests that he makes money mainly by outsmarting other investors, rather than by directing resources to where they’re needed. Again, it’s hard to see the social value of what he does. »Does Professor Krugman really think there is something wrong about being smarter than others?Is this an indication of a belief that « equality » really means dumbing down to the lowest common denominator?His linking outsmarting other investors and not directing ressources where they are needed is not mentionned in the article he cites as a source ( see David Segal ) nor is there a logical link between the proposition that Mr. Hall outsmarts others and the alleged lack of social value in what a Mr. Hall does with his greater smarts unless one were to hold the belief,as Professor Krugman implicitly appears to hold,that being smarter is unfair and has no social value.More’s the pity that such a leading economist should show such a bias.
Posted on 03/08/2009 by Pierre F. de Ravel d'Esclapon