You're assuming the policy decisions of the executive branch of the US fed government was the reason for the disaster.

You're also assuming that the advice acted upon by the POTUS was based on the Chicago school.

For the former point, it leaves out FNM/FRE, housing speculation, easy credit by the fed, a weak dollar, increasing debt from foreign wars, the piss-poor rating agencies, the asset bubble driven by chinese liquidity, etc.

For the latter point, there were economic decisions made that do not align with that school of thought.

tl;dr -- Post hoc ergo propter hoc.

Do you have a citation for point one?

The author of the article discusses not just Chicago School monetarism, but also the many other strains of economic thought over the past decades, including the 'New Keynesians.' Krugman apparently also disagrees with the New Keynesians, and the rest of the economic mainstream of the past 30 years, not just the Chicago School.

What the author is getting at is that Krugman doesn't seem to be reading economics anymore, from any school of thought.

Looking at the author's CV (http://faculty.chicagobooth.edu/john.cochrane/research/Paper... [DOC]), he appears to be a libertarian. Libertarians weren't exactly well-represented in the Bush administration, and CATO were among its fiercest critics on financial and foreign policy issues.

The anger over Krugman's piece doesn't seem to be limited to Cochrane or Chicago School economists either. Cochrane's personal web page also links to a similar piece featured on Huffington Post rebutting Krugman: http://www.huffingtonpost.com/david-k-levine/an-open-letter-...

Two strong assumptions:

1. Correlation is causation? 2. It is all the Bush adminstration's fault.

Regardless of what one thinks of Krugman's positions, he clearly deals in personal attacks far too often. If he's trying to educate the public, that's not helping his cause.

I'm not sure what instances you are thinking of, so perhaps I am mistaken, but from what I have read, Krugman wants to promote greater accountability. When he criticizes the decision or prognostication of an economist or politician, it's to avoid the passive voice - "Mistakes were made" and identify the party responsible for the error. I think he would expect others to hold him to the same standard.

Here's one example: http://krugman.blogs.nytimes.com/2009/03/03/roots-of-evil-wo...

Accusing people of "deliberate obtuseness" is no way to have an argument.

Post hoc ergo propter hoc

Krugman is not offering up a hypothesis that is better at explaining observations than his opponents. He is making an argument based on an ideological position while ignoring evidence suggesting, at a minimum, that his hypothesis is not supported. This is not science.

As Cochrane notes in one of his "minute points", *Pretty much all we have been doing for 30 years is introducing flaws, frictions, and new behaviors, especially new models of attitudes to risk, and comparing the resulting models, qualitatively to data." This set of "we" includes the behaviorists and "complexity economists" (i.e. people who really enjoy massive simulations of simple agents).