I have to hand it to Paul Krugman, because when he gets something wrong, he refuses listen to anyone else pointing out his mistakes. He has attacked the Austrian Theory of the Business Cycle many times, and though his description of the theory is wrong, he is not someone who will listen to someone explaining to him why he is mistaken.
In a recent blog post, he once again took on F.A. Hayek, and once again he got it wrong. Hayek (and Mises and Rothbard, for that matter) NEVER said that the patterns of malinvestments of the 1920s caused the Great Depression, nor do the Austrians claim that the Smoot-Hawley Tariff caused it, either. Krugman, who always is Stuck on Stupid, continues to misunderstand what Austrians mean by malinvestments, and why it is important to deal with them once a crisis begins. Instead, he continues to push the Keynesian doctrines that all it takes is more spending. I take on his point here.
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