Letters from our readers.
Jan. 11 1998 3:30 AM

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A Need for Speed

If we're going to have a debate, let's at least get the facts right. For starters, in "Speed Trap," Paul Krugman misspelled my name. I'll get over it. More important, he is just as careless in depicting the arguments of those of us who think the economy is now capable of decent growth without reigniting inflation.

My essay ("The New Economy: What it Really Means") in Business Week was much more balanced and modest in its claims than Krugman suggests. I invite Slate readers to reread my piece rather than accept Krugman's caricature of it, then decide for themselves. Business Week has generally been right about the performance of the economy in recent years--and right in urging the Federal Reserve not to raise interest rates. If the Fed had raised rates in order to hold growth down to 2.5 percent over the last 18 months, as Krugman seems to prefer, we would have given up $250 billion in economic output. The unemployment rate would have been at least a half percentage point higher, putting more than 750,000 people out of work.

1997 was a wonderful year--strong growth, declining inflation, declining unemployment, rising productivity, and rising real wages. Happy New Year, Professor Krugman.



"The New Business Cycle" (Business Week cover story, March 31, 1997)

"How Long Can This Last?" (Business Week cover story, May 19, 1997)

"Alan Greenspan's Brave New World" (Business Week cover story, July 14, 1997)


--Stephen B. Shepard

Editor in chief, Business Week

Paul Krugman replies:

First of all, my extreme apologies for the spelling mistake.


As for substance: We now see just how helpful an Internet magazine can be. By all means read the original Shepard essay in Business Week (notice that I did include a link to that essay in my original piece), as well as the earlier articles on the site, and ask yourself whether they did or did not appear to claim that our favorable measured growth and inflation performance can be explained by unmeasured productivity growth. If they did claim or even suggest that, then Business Week has indeed been saying something very silly. Oh, and by the way: Reread my own piece, and ask whether I actually say that growth over the past 18 months should have been held down to 2.5 percent, as Shepard claims I "seem to prefer."

What I do know is that a number of Business Week readers have contacted me since reading my piece and told me that the explanation of the speedometer fallacy was new to them--that they were under the impression, from reading BW, among other sources, that a hidden productivity boom was not only a possible explanation of low measured inflation but indeed the leading candidate.

I guess my question is whether Mr. Shepard is willing, even now, to concede that it is a fallacy to invoke unmeasured productivity as the source of our good numbers. (And I don't mean a judicious acknowledgment that there may be something to what I say--we are talking 2+2 = 4 here, with no wiggle room whatsoever. Extremism in the defense of arithmetic is no vice.) If he is, then I am at least prepared to consider the possibility that I (and everyone else I know) have been misinterpreting all those articles. But I would like to have the point acknowledged.

Option Pass


I thoroughly enjoy Slate, but I find Michael Kinsley's assertion of Slate's "journalistic integrity" as regards Microsoft ("Readme") to be without merit.

Consider the case where a judge discovers that he is presiding over a case involving a close relative. The only ethical course of action is to step down and have some other judge handle the case. Even if the judge tries his best to be fair and unbiased, he can never be sure of his own motives. In addition, the judge's own reputation is at risk, as people will not know if the relative in question was found innocent due to subtle manipulation by the judge.

Slate employees receive Microsoft stock options and therefore have a vested interest in Microsoft beyond their own paycheck. If Slate wants to prove its integrity, it should either refuse the options or stop covering Microsoft altogether.

--Robert D. Graham

The Greatest of Sleaze

In "Dear Microsoft," Jacob Weisberg seems to assert that lobbyists (and lobbying) are somehow sleazy.

The First Amendment to the Constitution guarantees the right to "petition the Government for a redress of grievances." That's lobbying. Exercising that right is no more sleazy than exercising the right to speak or to worship. Clearly, there are sleazy and unethical ways to go about it, but lobbying itself is vital to our democratic principles.

The best solution to the problem of corporate money in politics is to reduce the role of government in all our lives. Until that happens, corporations are irresponsible if they fail to pursue the interests of their shareholders, employees, and customers by lobbying Beltway bureaucrats.

--David C. Klug Harrisburg, Pa.

You Dirty Rat

I don't know whom Sarah Kerr hangs out with ("White Heat"), but Jimmy Cagney's stock has never slipped at all with my buds. More importantly, her assertion that the audience is unclear about Cagney's true state of mind at the end of Angels With Dirty Faces is just plain wrong. The entire heart of that character was his utter fearlessness at the prospect of dying; Rocky "goes yellow" only so that his reputation will be sullied among the youthful wannabe gangsters who idolize him. It is an act of renunciation that ennobles him in death and is undertaken solely due to the entreaty of his old pal Jerry Connelly (Pat O'Brien), who knows that asking Rocky to pretend he's a coward is the hardest favor he's ever sought. For Kerr to imagine anything at all ambiguous in the ending of this movie not only calls into question her judgment but forces one to wonder if she's even seen the damned thing.

--David MurrayLos Angeles

Javanile Humor

Andrew Shuman clearly has no idea what he is talking about when it comes to the question of Java ("Weak Java").

Java, although this has clearly escaped Shuman's keen eyesight, is not a programming language at all. It is in fact a mountainous island in the South Pacific, part of the very populous and highly authoritarian archipelago nation of Indonesia. It also happens to be the site of one of the world's most important archeological discoveries, known as Java Man, and of vast coffee plantations (hence the common usage of the term java to mean coffee). These simple facts get lost in Shuman's clutter of technical language. With his preposterous characterization of the whole Java conflict as a matter of convenience for personal-computer owners and programmers, Shuman completely obscures the real struggles of the Javanese people.

There is, in fact, no surprise here, since Shuman works and lives in Seattle, home of innumerable coffee shops and some of the nation's largest defense contractors, who reap billions annually from arms sales to the repressive regime of President Suharto. Workers on Javanese coffee plantations suffer endlessly, while residents of the Emerald City sip unreasonably cheap caffè lattes (subsidized with blood), ponder the importance of bandwidth, and root for the pathetic Mariners and Supersonics.

Please, no more harmful obfuscation from Slate and Shuman.

--Jesse Hoffnung-Garskof

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