World Economy

Paul Krugman, Italy finance minister have a scrap

Italian Economy and Finance Minister Pier Carlo Padoan in Rome, March 12, 2014.
Andreas Solaro | AFP | Getty Images

The new Italian finance minister, Pier Carlo Padoan, has a unique distinction. Paul Krugman, the American Nobel-prize-winning economist and New York Times columnist, doesn't seem to much care for his point of view.

In two different blog posts in the last few years, including one called "The Beatings Must Continue," Krugman criticized Padoan for his endorsement of austerity measures in Europe.

Italy FM Padoan: Austerity works

Padoan became finance minister of Italy, the euro zone's third-largest economy and the world's ninth largest, in February. Before that, he was the chief economist of the Organization for Economic Cooperation and Development, where he endorsed austerity—that's where Krugman's criticisms kick in.

Padoan responded (read it here) to Krugman, a noted Keynesian economist, at the time in the comments section on the Times website.

In an interview with Minister Padoan in Washington this week, CNBC had a chance to chat with him about the future of Italy, of which he is very confident now that the country has cut spending and interest rates have come down.

What is illustrative about the conversation is that it shows the debate between spending vs. cutting is as strong in Europe as it is in the United States.

By CNBC's Michelle Caruso-Cabrera