Paul Krugman: Welcome To The Third Depression
Video: Krugman says we have $5 Trillion to mess around with -- 2009
The battered and bruised Paul Krugman, fresh off a failed trip to Germany intended to garner support for more global stimulus, has published a new op-ed this morning:
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I'm reprinting the comment I made on Krugman's blog in response to this story. I'm confident he won't publish it.
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Krugman is right about the need to extend unemployment benefits, but it should be paid for (in other words -- cut something else to balance the cost) and it shouldn't be in the same bill as the incredibly unpopular, unfair and illogical state bailout.
What Krugman fails to understand STILL is that fiscal stimulus DOESN'T WORK in creating any substantial and sustainable private sector jobs, at least not in this mother of all debt-deleveraging recessions. Keynesians take it for granted that government spending works to stimulate employment no matter the environment, and they only want to argue about how much stimulus to use.
We're saying stimulus hasn't and won't work in this downturn. So stop trying.
Seriously, between Bush and Obama stimulus, plus the bailouts, and the FED with their foot on the QE gas pedal, and what is the result? NOTHING...nada. zilch, zip. So stop trying already. Nothing but time and trillions in debt destruction can cure the economy. It's all borrowed -- 43 cents of every dollar spent by the federal government is BORROWED.
Suck on that for breakfast, Krugman.
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Jun 28, 2010 at 4:00 PM
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