Paul Krugman Calls Summers a "Fool" Who Warned of 'US Inflation Concerns'

$1.9 Trillion Stimulus Inflation Risk Debate, US CNN Appearance Dispute
Yellen Says "Inflation Risk Small and Manageable, Debt Must Be Controlled"

Paul Krugman, Professor at the City University of New York

[Asia Economy New York=Special Correspondent Baek Jong-min, Reporter Kim Su-hwan] Amid heated debates over whether the massive $1.9 trillion stimulus package will trigger inflation, Nobel laureate economist Paul Krugman, a professor at the City University of New York, and former Treasury Secretary Larry Summers have clashed. Professor Krugman even used the harsh term "idiot" on Twitter to criticize former Secretary Summers.

Summers, a Harvard professor who served as Treasury Secretary during the Barack Obama administration, and Professor Krugman appeared on CNN's "On GPS" program on the 14th (local time), presenting differing views on the possibility of inflation.

Summers, who has repeatedly expressed concerns that the large-scale stimulus pushed by President Joe Biden will ultimately cause inflation, reiterated his argument that day, saying, "If you pour too much water into the bathtub, it will start to overflow," and "We are trying to pour in too much water."

In response, Professor Krugman referred to the stagflation of the 1970s, countering, "If the government does not step in, stagflation like back then could occur." He emphasized, "Even after the Korean War, massive spending was expanded, but inflation subsided quickly," adding, "It will be the same this time." While the scale of spending is indeed huge, the possibility of overheating the economy is low.

Larry Summers, Harvard University Professor (Former U.S. Secretary of the Treasury)

On the 12th, the day the broadcast was recorded, Professor Krugman directly attacked Summers, who opposes the stimulus package, through his Twitter, saying, "It is strange to debate with fools or politicians, but you have to get used to it."

Janet Yellen, U.S. Secretary of the Treasury, in an interview with ABC on the same day, continued her previous stance on inflation concerns, stating, "There is only a small risk, and I think it is manageable." She also emphasized that there are tools available to respond if inflation occurs.

However, Secretary Yellen responded to concerns about the increase in national debt due to the U.S. government's large-scale fiscal spending by saying, "It is manageable, and there is a need to control deficits in the long term."

According to The Wall Street Journal (WSJ), as of March 1, the U.S. national debt stood at $21.9 trillion, having increased by $4.5 trillion since the COVID-19 pandemic. Considering economic output, WSJ described this as the highest level since World War II. WSJ expressed concerns that while there is no immediate worry about high inflation or a fiscal crisis, the situation could change in the future.

This content was produced with the assistance of AI translation services.