Saltwater champs.

Students at Marshfield High School in Marshfield, Wisc. didn't let their non-proximity to the ocean stop them: The five-person team won their second National Ocean Sciences Bowl championship in St. Petersburg, Fla.

Twenty-five high schools competed in marine biology, technology, climate change and geography categories. The coasties placed and showed too:

Marine Academy of Science and Technology, of Highlands, N.J., placed second, and Mission San Jose High School, of Fremont, Calif., placed third.

Kinda blows Paul Krugman's thesis today out of the water --

The "freshwater" * people in the 21st Century are just too dumb to realize Americans can't be self-sufficient and isolating, and if the people on the coasts make a big mess despite all their expertise and need to rely on others to bail them out, we ought to just shut our dumb cud mouths and accept that the elites are really on the money this time... No really, we mean it! We know better than you where your dollars should be spent -- "you're not listening" whine...

You think I'm kidding in the above paraphrase? Today's post, in full:

There’s been a huge outpouring of blogospheric discussion about “epistemic closure” on the right: a complete refusal to look at evidence or arguments that don’t come from the like-minded. I don’t have much to say about all that aside from the fact that it’s obvious, and has been going on for years.

But I think it’s worth pointing out that something similar has long been true in macroeconomics. And like the political version of epistemic closure, it’s not a “both sides do it” issue. It’s a fresh-water phenomenon; salt-water macro isn’t subject to the same problem.

Here’s what I mean: ask a grad student at Princeton or MIT, “How would a new classical macro guy answer this?”, and the student can do it; classes at freshwater departments teach real business cycle theory, and good students can tell you what it says even if their professors have a different view.

But students at freshwater schools — or, alas, many of their professors — can’t return the favor. It’s been painfully obvious since the crisis broke that people at Minnesota, or even many people at Chicago, have no idea what New Keynesian economics is all about. I don’t mean they disagree, or think it’s garbage, they literally have no idea what the concepts are. And that’s why they reinvent 80-year-old fallacies when they try to discuss the subject.

It’s interesting to ask why this sort of cocooning is a feature of the right but not the left. But it’s very real, and has a dire impact on economic as well as political discourse.

Thanks saltwater fellas. You've helped us enough. Really. How about a nice long vacation, stimulating the economy by spending what you've earned over the years proposing and predicting solutions that have led us to this ledge? Really, I think spending -- and spending big -- to get that money back into circulation is the greatest contribution the multiple prize-winning professor pundit could make right now.

Spend your own; stop mandating choices away from others. Because trust me: not everyone is equally at risk for kidney dialysis or stents even, and pretending that we're all equal assumes people have no control over their own personal health (unpredictable!) -- exactly the wrong message we want to be sending at this time.

Luckily, I doubt many turn to Paul Krugman for either his predictions, or his personal health advice.

The key fact about health care — the central issue in health care economics — is that it’s all about the big-ticket items. Checkups don’t cost much; neither does the treatment of minor illnesses. The money that matters goes to bypasses and dialysis — costs that are highly unpredictable, and that almost nobody can afford to pay out of pocket. Modern health care, if it’s going to be provided at all, has to be paid for mainly out of insurance.

Live simply, and stay away from those big-ticket items, if at all possible. Yes You Can!

The sooner one starts taking responsibility for personal matters, the greater individual power that amasses. (presuming we can soon stop these unconsitututional power grabs by well-meaning liberals pushing unfunded mandates onto others as their solution to saving the poor and needy ill. In my house, we call that treating the symptoms and ignoring the underlying illness of the complete body system. And we limit the desserts too, instead of serving up more, because we understand the consequences of overconsumption and the need to carry one's own weight. Must be a freshwater v. saltwater bouyancy thing... hard v. easy to stay afloat.)

More Krugman: (You've got to ask yourself one question: Do I feel confident? Well, do ya, punk? Nevermind watching sausage being made, ever watched what they put in fudge?)

Yet if the crisis has pushed freshwater economists into absurdity, it has also created a lot of soul-searching among saltwater economists. Their framework, unlike that of the Chicago School, both allows for the possibility of involuntary unemployment and considers it a bad thing. But the New Keynesian models that have come to dominate teaching and research assume that people are perfectly rational and financial markets are perfectly efficient.

To get anything like the current slump into their models, New Keynesians are forced to introduce some kind of fudge factor that for reasons unspecified temporarily depresses private spending. (I’ve done exactly that in some of my own work.) And if the analysis of where we are now rests on this fudge factor, how much confidence can we have in the models’ predictions about where we are going?

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*

Saltwater economists are associated with economists from the Universities on the East and West coasts of the US. In particular universities such as Berkeley, Harvard, MIT and Yale.

Economic thought from these universities tends to be more suspicious of free markets and advocate a greater role for government regulation and discretionary fiscal policy. Saltwater economists are more critical of rational expectations and point to examples of irrational behaviour.

Freshwater economists are associated with the Chicago school of Economics and other universities around the Great Lakes such as Rochester and Minneapolis. The Chicago school of Economics is such a dominant force in economics, it is probably a more common term than ‘Freshwater Economists’.

Freshwater economists typically place greater emphasis on the benefits of free markets, rational expecations, real business cycle, monetarism and are more critical of government intervention in the economy. It is also termed ‘laissez faire’ economics and is closely allied to the neo–classical school of economics.