The worst of these bad ideas is that we have a limited supply of money. In Federalist 30, Alexander Hamilton said:
“Money is, with propriety, considered as the vital principle of the body politic; as that which sustains its life and motion, and enables it to perform its most essential functions. A complete power, therefore, to procure a regular and adequate supply of it, as far as the resources of the community will permit, may be regarded as an indispensable ingredient in every constitution. From a deficiency in this particular, one of two evils must ensue; either the people must be subjected to continual plunder, as a substitute for a more eligible mode of supplying the public wants, or the government must sink into a fatal atrophy, and, in a short course of time, perish.”
Hamilton was right. We have failed to provide “a regular and adequate supply” of money, we have been “subjected to continual plunder,” and our government has fallen into “a fatal atrophy” which prevents us from improving our infrastructure, and blocks the prudent actions needed to deal with global warming. Those who control our government and our economy have created an artificial shortage of money in order to increase their personal power at the expense of the people.
Money is our only unlimited, natural, national resource. We should follow Hamilton’s advice and give every American a “regular and adequate supply” in the amount of $36,000 per year for life.
“Money is, with propriety, considered as the vital principle of the body politic; as that which sustains its life and motion, and enables it to perform its most essential functions. A complete power, therefore, to procure a regular and adequate supply of it, as far as the resources of the community will permit, may be regarded as an indispensable ingredient in every constitution. From a deficiency in this particular, one of two evils must ensue; either the people must be subjected to continual plunder, as a substitute for a more eligible mode of supplying the public wants, or the government must sink into a fatal atrophy, and, in a short course of time, perish.”
Hamilton was right. We have failed to provide “a regular and adequate supply” of money, we have been “subjected to continual plunder,” and our government has fallen into “a fatal atrophy” which prevents us from improving our infrastructure, and blocks the prudent actions needed to deal with global warming. Those who control our government and our economy have created an artificial shortage of money in order to increase their personal power at the expense of the people.
Money is our only unlimited, natural, national resource. We should follow Hamilton’s advice and give every American a “regular and adequate supply” in the amount of $36,000 per year for life.
6
Seriously bad ideas, I’d argue, have a life of their own. And they rule our world.
---------------------------------------------
Southern Italy had a holiday ("the brown nose competition holiday") in which the poor gave gifts to the professional class and landowners. The rich hated the holiday and it finally was quashed. .
Modern politicians exist with the grace of the affluent class. They want to please them with gifts even before they ask.
---------------------------------------------
Southern Italy had a holiday ("the brown nose competition holiday") in which the poor gave gifts to the professional class and landowners. The rich hated the holiday and it finally was quashed. .
Modern politicians exist with the grace of the affluent class. They want to please them with gifts even before they ask.
6
Never pass an opportunity to spend other people's money.
Same old tired formula. When's the last time he was right on anything?
Same old tired formula. When's the last time he was right on anything?
10
Religion is to blame. For centuries, organized religion has held hostage people's earthly happiness and eternal salvation in order to coerce them to believe on "faith" things that cannot be proven. Such as: you should give money to your church; your church knows better than you what to do with your body; the church leaders are better than you so any horrors they perpetrate are to be ignored.
8
Not sure but I wonder to what degree that racism plays into this. Why do poor and to some degree uneducated people buy one set of beliefs over another? Statistical they shouldn't, so the marginal informed voter should rule the day. Instead, we have poor and middle class white people in both America and Britain voting against their interest. Why? My guess is they side with the party that says people of color are sucking off the State, and that their taxes are going to pay for them, attracting even more. Hence vote conservative to preserve the culture, even if it means destroying their economic life. Once that hook is set, they then buy into the whole conservative set of beliefs.
10
If the wealth-creating, non-tax supported, private owned US businesses were more profitable, then the US economic pie will be larger, and then there will be more privately owned taxable wealth in the USA available for the US government to confiscate to pay for more and more government services such as wealth distribution, constructing more and more infrastructure, and other US government services without the US government always having to borrow more and more money from the industrialized nations, with no end in sight.
Where does the money come from to pay for these government services such as creating, replacing, operating and maintaining infrastructure?
The taxable wealth that is created and owned by private businesses and individuals in any nation is (almost) the only source of wealth available for the federal and local governments to forcibly take or confiscate a portion of in the form of taxes in order for the government to raise funds to pay for all of the bureaucratic employee payrolls, government services, entitlements, government contracts, military contracts, gigantic Lockheed-Martin type military contract(s), Solyndra type PAY TO PLAY business loan then bankruptcy deals, CGI Federal PAY TO PLAY contract awards, wars, welfare, unemployment benefits, and other government expenses that pay citizens by expending national wealth to pay for these non-wealth-creating activities that actually consumes and destroys the nation's wealth and economic capabilities.
Where does the money come from to pay for these government services such as creating, replacing, operating and maintaining infrastructure?
The taxable wealth that is created and owned by private businesses and individuals in any nation is (almost) the only source of wealth available for the federal and local governments to forcibly take or confiscate a portion of in the form of taxes in order for the government to raise funds to pay for all of the bureaucratic employee payrolls, government services, entitlements, government contracts, military contracts, gigantic Lockheed-Martin type military contract(s), Solyndra type PAY TO PLAY business loan then bankruptcy deals, CGI Federal PAY TO PLAY contract awards, wars, welfare, unemployment benefits, and other government expenses that pay citizens by expending national wealth to pay for these non-wealth-creating activities that actually consumes and destroys the nation's wealth and economic capabilities.
4
One only has to look at Kansas as a test case and see the results of Republican, Gilded Age, trickle down economics and see the results. And add in Wisconsin for the kicker and you'd have to wonder, or even marvel, at the stupidity and chilishness of the right's narrow mindedness in the are of economics. I mean results don't even register in their blindness. So what does a logical thinking person have to do in the age of idealism gone array? I guess the end must come just as it did under Hoover's presidency to shine any light on the subject, and that my friends will come when the stock market goes on a bender as history repeats itself in the not to distant future. Wasn't it first the real estate bubble, and then the Stock Market?
11
Actually Krugman has his own zombie idea--and that is his suspicion, more on the order of a guess, that if Greece defaults and leaves Europe, it might be an epic disaster. And where does he get this zombie idea? From the austerity gang! That's right, enough of their garbage has seeped through that even the Master of Anti-austerity has caught a little of de flu. But my zombie idea is this--let's give it a shot. That's right, let Greece default and print their own money, just like they did before for thousands of years. And let's just see what happens. My guess: NOTHING. Why? Because Elliott's Rule has already reached its critical mass of experts required to agree that disaster looms, and therefore it doesn't. LET'S JUST SEE, is my approach to every problem, and it made me rich, so maybe there's something to it.
6
A minor point, but my experience with trains in England has been much better than in America. In particular, I was impressed with the ability to get to truly tiny villages, and tickets were cheaper than Amtrak. Now, I'd agree that Deutsche Bahn is better still, but I can't think of any respect in which American passenger rail would beat British. Of course, Mr. Krugman has the good fortune to be in the New York–D.C. corridor where American trains seem to work their best.
8
I am reading you column later than usual. You write the truth but it seems to me that while you are in the UK you might want to do some sleuthing to learn who Mr. Osborne's economic advisors are and find out their rationale for why they have advised Mr. Osborne to deny Britain's real economy is ailing & what the economic forces are behind the unprecedented productivity bust. 7% decline in productivity is not small. It is dramatic. I theorize that there is a direct correlation of negative productivity with traffic congestion & passenger rail problems.
Clearly, congestion & the movement of goods & people are taking a toll on the US economy: America urgently needs to build new 21st Century transport systems that will greatly reduce highway deaths, injuries, & collisions, eliminate pollution and greenhouse gas emissions, and be faster, cheaper, and less stressful.
33,000 US deaths per year! In the 15 years since 2000, 500,000 people have died on US highways, more than the 426,665 battle deaths in all of America’s wars in the 20th Century – The Spanish American, World Wars I and II, Korea, Vietnam, and Desert Storm. Over 100 times more than the 9/11 deaths.
If there were a safer, better, cheaper option, we would take it.
In the US, if we enact a surface transportation bill, it should include a program to test & compete its 300 mph superconducting Maglev transport for passengers and freight to augment the Interstate Highway System. Concept at www.magneticglide.com
Clearly, congestion & the movement of goods & people are taking a toll on the US economy: America urgently needs to build new 21st Century transport systems that will greatly reduce highway deaths, injuries, & collisions, eliminate pollution and greenhouse gas emissions, and be faster, cheaper, and less stressful.
33,000 US deaths per year! In the 15 years since 2000, 500,000 people have died on US highways, more than the 426,665 battle deaths in all of America’s wars in the 20th Century – The Spanish American, World Wars I and II, Korea, Vietnam, and Desert Storm. Over 100 times more than the 9/11 deaths.
If there were a safer, better, cheaper option, we would take it.
In the US, if we enact a surface transportation bill, it should include a program to test & compete its 300 mph superconducting Maglev transport for passengers and freight to augment the Interstate Highway System. Concept at www.magneticglide.com
3
"Seriously bad ideas, I’d argue, have a life of their own. And they rule our world."
For once I have to agree with our esteemed propagandist. Take climate change for example...
For once I have to agree with our esteemed propagandist. Take climate change for example...
5
Nixon once said "We're all Keynesians now." The problem in the U.S., at least, is that we are not honest Keynesians. Keynes, asserting that governments must run deficits to support demand during recessions, also said that surpluses should be gathered at the top of the business cycle. Yet when we finally achieved a (very) modest surplus at the end of Clinton's term, our newly not-so-elected President immediately returned us to deficit spending with a large tax cut (and led us to war, and then cut taxes AGAIN... Ah, but as another Dick said, "Reagan proved deficits don't matter", right?).
We all like that sugar rush of deficit stimulus - and we just hate to see the punch bowl taken away.
Now may not be the time in Britain to flip the Keynesian coin, and Osborne's motives and/or judgement may be suspect, but there's some point to his suggested law to run a surplus when conditions make it possible; because no matter how low interest rates are at a particular time, if the additional debt is never paid back, it's carrying cost soon reverts to the mean.
We all like that sugar rush of deficit stimulus - and we just hate to see the punch bowl taken away.
Now may not be the time in Britain to flip the Keynesian coin, and Osborne's motives and/or judgement may be suspect, but there's some point to his suggested law to run a surplus when conditions make it possible; because no matter how low interest rates are at a particular time, if the additional debt is never paid back, it's carrying cost soon reverts to the mean.
5
Our so-called leaders ought to go back and look at some of the ways Franklin Roosevelt helped our country get back to business, and grow some hope. Boy, do we ever need that kind of unifying vision, now.
4
The Incredible Shrinking U.K.,
a continuing epic.
a continuing epic.
1
"Nobody fully understands either why this slump has happened or how to reverse it . . ." ???
Try the tidal wave of "Made in China" that has swept over the Western democracies since 1980.
Try the tidal wave of "Made in China" that has swept over the Western democracies since 1980.
5
What is there to say but that John Q Pulbic is to blame for this continued farce, wittingly or unwittingly. The farce goes on because people simply do not want to pay taxes, and do not understand the meaning of a progressive tax system enough to realize how they have been screwed over the decades, with the major exception being that the 1% have figured it all out and then some to their benefit.
4
When you are the Entitlement Party -- entitled by birth and wallet to lead-- facts are not required. What IS required is a gullible public (self-explanatory) and some fraudulent media (Fox etc). No lack of either , here or in Britain. I look longingly and hopefully forward to the time when we can join Mr. Krugman and look back and laugh about it. But now's not that time, so thank you Paul for staying on message.
7
"Isn’t all this deficit obsession just an excuse to slash social programs? And I’m sure that’s part of it.". Professor Krugman continues the smuggling in of his progressive political views into his economic analysis. this is intellectually dishonest and his usual modus operandi.
6
To Eric in N.J.:
To your point: how do you feel about the national highway system? Was Eisenhower wrong? Are they your potholes or ours?
To your point: how do you feel about the national highway system? Was Eisenhower wrong? Are they your potholes or ours?
4
It is hard to imagine that any ideas could be more seriously wrong that Mr. Krugman's own crackpot Keynesian ones! He only pushes for more spending, bigger Government, and more monetary manipulation by Central Banks. All ideas that have failed again and again! But what is Krugman's cure for failed "Free Lunch" Keynesianism? Well even more "Free Lunch" Keynesianism of course!
11
Krugman's right. The trouble is the British Labor Leader's does not have the refined personality of Cameron, or his charisma. He come's across a dour.
The news media often takes a totally wrong non fact based approach to reporting the news. Corporate news agendas have led to serious blunders, for instance the war in Iraq. They sell celebrity credibility whether it be from generals or corporate leaders. The superficiality of it and the ability of reporters and editors at large news outlets to promote their personal agendas is quite striking. Ambition and the drive for profits have driven the consolidation and out of touch nature of corporate news.
2
The reason that these ideas continue to circulate and have so much staying power is that the right wing-nut promulgators are basically a faith-based lot and have no understanding of facts or reason. They will never change their minds. Unfortunately, they have the money to continue to publicize their opinions. The only solution is to educate the voter to elect a merit and fact based legislature. Fat chance.
7
Can Krugman seriously still be talking about austerity as the Federal government continues to print a billion a day for the last 7 years? Do we really believe that is austerity?
Krugman, definition please.
No, we've not had any austerity. No budget since 2009 when dems controlled everything. No cuts in overall spending. Ever. And 47% + still pay no Federal taxes AND most get 'free money' back - money they never paid in the first place, called a tax credit. If this is auterity, we are all doomed.
Krugman, definition please.
No, we've not had any austerity. No budget since 2009 when dems controlled everything. No cuts in overall spending. Ever. And 47% + still pay no Federal taxes AND most get 'free money' back - money they never paid in the first place, called a tax credit. If this is auterity, we are all doomed.
17
I think you'll find that the article is referring to the United Kingdom, not the USA.
1
Umm, this article was almost exclusively about Britain. Note the first word is Oxford...as in England, not Mississippi. Take a deep breath and find some statistics that support your point in Britain.
6
So, the last seven years bother you, but $11 trillion in debt run-up during W.'s disastrous presidency on tax cuts skewed to the rich and useless wars, does not?
And, yes, it's $11 trillion ... when Mr. Clinton left office, our debt was $5 trillion, with a $5 trillion surplus over the following 10 years - basically, zero debt if we wanted to. And W. and the republicans certainly did not want to.
And, yes, it's $11 trillion ... when Mr. Clinton left office, our debt was $5 trillion, with a $5 trillion surplus over the following 10 years - basically, zero debt if we wanted to. And W. and the republicans certainly did not want to.
4
This isn't austerity at work it is feudalism. It would be one thing to say the state owns the means of production and the state is doing a poor job of administering processes and systems. It is quite another to make the claim the economy is not performing because the people who make the goods and deliver the services are not trying hard enough. The state doesn't own the means of production either here or in Great Britain. If the only leadership offered is austerity why would productivity not fall?
The economy was broken by people with too much who needed even more and didn't really care what needed to happen to achieve that goal. People masquerading as corporations are sitting on massive piles of cash refusing to either share those profits with the people who made it possible or pay taxes to sustain the common resources that make the economy viable.
What the seriously important people will do is collude with like minded folks or failing to gain cooperation start a war. The common man is offered work maintaining the gilded chaise lounges of the ruling classes in return for service killing their enemies over market access. That is a classic description of feudalism.
The economy was broken by people with too much who needed even more and didn't really care what needed to happen to achieve that goal. People masquerading as corporations are sitting on massive piles of cash refusing to either share those profits with the people who made it possible or pay taxes to sustain the common resources that make the economy viable.
What the seriously important people will do is collude with like minded folks or failing to gain cooperation start a war. The common man is offered work maintaining the gilded chaise lounges of the ruling classes in return for service killing their enemies over market access. That is a classic description of feudalism.
10
Orwell had it right and he also had it wrong. Tricks of rhetoric and propaganda have been used to thoroughly confuse, mislead, and manipulate the public, but it's conservatives, not communists, who are employing them. Consider the concept of "fiscal responsibility." If a municipality, a state or province, or a country is running a deficit to pay for things like education, health services, social security, etc., we are told that the government needs to become more "fiscally responsible" and cut the amount it spends on such things. By employing the term, the right has already moved the terms of debate to its own ground - spending on social security and public welfare is no longer a responsibility but a luxury, and raising taxes on the wealthy to pay for them is most certainly not a legitimate way to pay for them, but is instead "irresponsible" and "profligate."
11
There are limits to the amount of government expenditures that the taxpayers of any nation, State, County, City, School District, Hospital District, or other Government service organization can afford to pay for their government activities!
6
Well, of course, there are.
It seems in homogeneous societies (especially northern Europe) the limits appear to be much, much higher than in the U.S. where people look out for "me first" while talking about "family values" out of the sides of their mouths.
It seems in homogeneous societies (especially northern Europe) the limits appear to be much, much higher than in the U.S. where people look out for "me first" while talking about "family values" out of the sides of their mouths.
9
Yes... and we are still far, far away from reaching those limits.
The explanation for these serious people sticking to seriously wrong ideas and ignoring facts is really quite simple. Those fiscal conservatives have a fiscal religion. That faith demands certain ingrained beliefs. Just as practicing Catholics believe in God and accept that the Pope is infallible, just as the creationists hold fast to the idea that the world or universe is only 6500 years old, so these fiscal conservatives stick to their faith, no matter what. Events, data, facts that discredit their faith are unacceptable. - So there is no use arguing with a firm believer who holds fast to his religion under any and all circumstances. - A problem arises though when these people are in a policy making position and can set a country on th path to more recession or even oblivion.
7
What about those citizens that believe that almost every citizen can be supported off of their government?
Where does that government money come from?
Where does that government money come from?
1
Add global warming to the seriously bad ideas that have remarkable staying power. The hiatus or pause in temperature rise since 1998 while CO2 continues to increase calls GW predictions into question. So, the proponents re-spin the data to try to erase it. Economic consequences are not being considered but solutions are bound to drive up energy costs and thus all costs - for questionable benefits. The impact will fall most heavily on the already suffering middle and lower classes - yet the Very Serious People continue to push the theory.
8
"The hiatus or pause in temperature rise since 1998 while CO2 continues to increase calls GW predictions into question."....Pleases quote your source. Everything I have read says that the average global temperature last year was a record high, the average ocean temperature was a record high, and the polar and Greenland ice cap continues to recede.
7
What’s been happening is that polls reflect the norms set by Gop continual messaging in the media, which they have monopolized with Fox TV/radio everywhere. So that liberal ideas that would benefit the majority seem too left wing, so the media doesn't even discuss it.
Then the Dems used those polls to set up how they will react and what they will propose. Always with an eye on political donors of the big money. In our system without public financing and no limits on big money, how could it be otherwise? Having only 2 parties makes it so convenient.
That's how the country moved rightward, with Dems, who are supposed to defend working people, having Wall St in their cabinets, And pushing Republican type major policies like financial deregulation and a health care system that leaves millions out while subsidizing medical industry profits.
Then this is called great progress by Krugman, when he should be fighting for specific financial regulations of decades ago, and for a 1st rate h/c system with costs negotiated by govt with corporations like most other 1st world countries have had for some time.
Now after all the damage, Sanders is out there, and polls are showing some anti Gop ideas. But where is the mechanism to translate these into political action? Krugman must start challenging Repubs with specific policies to fight inequality, using real people examples in more advanced nations as positive role models..
Then the Dems used those polls to set up how they will react and what they will propose. Always with an eye on political donors of the big money. In our system without public financing and no limits on big money, how could it be otherwise? Having only 2 parties makes it so convenient.
That's how the country moved rightward, with Dems, who are supposed to defend working people, having Wall St in their cabinets, And pushing Republican type major policies like financial deregulation and a health care system that leaves millions out while subsidizing medical industry profits.
Then this is called great progress by Krugman, when he should be fighting for specific financial regulations of decades ago, and for a 1st rate h/c system with costs negotiated by govt with corporations like most other 1st world countries have had for some time.
Now after all the damage, Sanders is out there, and polls are showing some anti Gop ideas. But where is the mechanism to translate these into political action? Krugman must start challenging Repubs with specific policies to fight inequality, using real people examples in more advanced nations as positive role models..
3
There is an insidious, extremely dangerous and destructive force called greed, and until we aknowledge and accept this fact, we will have serious problems.
We can rein it in. This has been done in the past, only to have the greediest water down protective regulation.
We must always be on our guard against this.
Our recent economic crash is a product of weak control.
Greed hurts us all.
We can rein it in. This has been done in the past, only to have the greediest water down protective regulation.
We must always be on our guard against this.
Our recent economic crash is a product of weak control.
Greed hurts us all.
4
All governments at every level in every nation have always depended upon their greedy industrious private businessmen (and their greedy corporations) in every nation to create new national wealth and non-taxpayer paid for jobs because that is (almost) the only source of taxable national wealth available to be confiscated in the form of taxation by various levels of government in order to create funds to pay for non-wealth–creating activities that actually consume this nation's taxable wealth and national economic capabilities such as the Solyndra type pay to play business deals, CGI Federal political power influenced contract awards, wars, the gigantic and expensive Lockheed-Martin type military contract(s), welfare, unemployment benefits, build and operate schools, water and sewer systems, repay sovereign national debts, construct pork barrel projects, green projects, infrastructure projects, wars, streets, bridges, highways, welfare, unemployment, police, courts, prisons, fire fighters, social security and other wealth-consuming government-provided bureaucratic activities for that family, tribe, city, state, or nation, except for borrowing money and obligating future tax collections from future generations to repay those loans (treasury bonds) with title to privately owned national wealth in the USA provided as collateral.
3
Gerald, you are a total bore. If not for government spending, we would not have national defense (or do you feel that the military and the border patrol are somehow "different"?). And clearly from what you say, we don't need police, courts, fire departments or anything else. You might consider what it would be like if every person had to do all this for themselves. Oh, I forgot! You are from Texas.
3
We need to develop and popularize some simple myths that show what a bad idea austerity is. It would be nice if the myths reflected economic reality instead of concealing it, but the popularity of the austerity myth shows that this is by no means necessary.
The myths that lead to austerity are the myths of the free market and lazy, mooching takers. The myths that lead to an activist government are the myths of class struggle and the greedy, grasping investor class. The class struggle myth was poisoned by Communism and its failure. The myth of greed, of the moral turpitude of our investors, is like the myth that when the South was segregated white supporters were moral monsters -- much too simple, so that it hides any path towards fixing the problem.
Evil systems are not caused by evil individuals; once in existence, they produce the individuals they need to survive. If the system is disrupted in the right way, production of these individuals drops. If it is disrupted in the wrong way, more of these individuals are produced and they end the disruption and restore the evil system.
The myths that lead to austerity are the myths of the free market and lazy, mooching takers. The myths that lead to an activist government are the myths of class struggle and the greedy, grasping investor class. The class struggle myth was poisoned by Communism and its failure. The myth of greed, of the moral turpitude of our investors, is like the myth that when the South was segregated white supporters were moral monsters -- much too simple, so that it hides any path towards fixing the problem.
Evil systems are not caused by evil individuals; once in existence, they produce the individuals they need to survive. If the system is disrupted in the right way, production of these individuals drops. If it is disrupted in the wrong way, more of these individuals are produced and they end the disruption and restore the evil system.
2
"or continually saying that all that's happened in Iraq isn't their fault, when it kinda was. After all the blatant lies, they continue to win election after election ..."
All that happened in Iraq isn't their fault. But nice try.
Obama said he ended the war in Iraq and left it with a stable government. Like you said, blatant lies to win an election. Obama should attend some high school sporting events. He might learn how to tell when something is really J.V.
All that happened in Iraq isn't their fault. But nice try.
Obama said he ended the war in Iraq and left it with a stable government. Like you said, blatant lies to win an election. Obama should attend some high school sporting events. He might learn how to tell when something is really J.V.
7
Your request to change the subject toward an irrelevant topic in which the man you despise -- Barack Obama -- has not succeeded in cleaning up yet another conservative tragedy -- destroying the stability of the Middle East with a war your team lied to get the country into -- has been denied.
Your boys broke it. And it's not going to be fixed for a very long time.
Your boys broke it. And it's not going to be fixed for a very long time.
1
Professor Krugman always proposes to sell or mortgage title to everything of value in the USA that was created by previous industrious working generations of US citizens in order to create sufficient US government funds to pay for most US Citizens to live directly or indirectly from US government funding!
This economic policy will also keep current US citizens from working today to make the things that US citizens purchase and consume.
This will keep the USA from re-industrializing and keep US citizens from having to work as required to produce the things that US citizens consume!
This policy will be successful until the USA has no more assets to pay for our imported products and our increasing government expenses.
Capitalism is the goose that lays the golden egg.
Without that, everyone would be equally poor.
America has produced a grossly over-educated workforce with a majority that is devoid of any of the useful and practical skills demanded by the marketplace.
This economic policy will also keep current US citizens from working today to make the things that US citizens purchase and consume.
This will keep the USA from re-industrializing and keep US citizens from having to work as required to produce the things that US citizens consume!
This policy will be successful until the USA has no more assets to pay for our imported products and our increasing government expenses.
Capitalism is the goose that lays the golden egg.
Without that, everyone would be equally poor.
America has produced a grossly over-educated workforce with a majority that is devoid of any of the useful and practical skills demanded by the marketplace.
7
And with Capitalism, MOST everyone is poor and all the wealth is concentrated with a select few. Sounds pretty desirable to me. NOT.
Yep, Gerald. We're all lazy and sitting around waiting for handouts. And, btw, the earth is flat, too.
Yep, Gerald. We're all lazy and sitting around waiting for handouts. And, btw, the earth is flat, too.
14
"Ignorance is strength"
— GOP slogan
— GOP slogan
9
Tommy,
Free Market Capitalism probably started before recorded history when a successful cave hunter returned to his cave and traded parts of his dead animal to other members of his cave clan for some fruit the other member has in his/her possession, or maybe something else of value such as a weapon or sexual services.
Foreign Trade between clans probably started when a successful hunter passing the cave of another clan might have traded some of his dead animal parts for that other clan’s things of value such as a weapons, tools or sexual services.
Traders took chances by approaching foreigners because those foreigners might have just killed the hunter and taken his possessions if the hunter was not also a good warrior to defend himself.
The hunter’s tribe would also probably descend onto foreign hunters that wandered into their areas of control and then kill them for their possessions.
Pirates at sea also killed their hapless victims on the high seas when the victims were caught by the pirates on the high seas.
During the Westward trek of the pioneers to settle the West in the late 19th century, the Mormons stopped and killed the westward pioneers and settlers that encountered the Mormons, who then took all of the traveler’s possessions.
http://en.wikipedia.org/wiki/Mountain_Meadows_massacre
Free Market Capitalism probably started before recorded history when a successful cave hunter returned to his cave and traded parts of his dead animal to other members of his cave clan for some fruit the other member has in his/her possession, or maybe something else of value such as a weapon or sexual services.
Foreign Trade between clans probably started when a successful hunter passing the cave of another clan might have traded some of his dead animal parts for that other clan’s things of value such as a weapons, tools or sexual services.
Traders took chances by approaching foreigners because those foreigners might have just killed the hunter and taken his possessions if the hunter was not also a good warrior to defend himself.
The hunter’s tribe would also probably descend onto foreign hunters that wandered into their areas of control and then kill them for their possessions.
Pirates at sea also killed their hapless victims on the high seas when the victims were caught by the pirates on the high seas.
During the Westward trek of the pioneers to settle the West in the late 19th century, the Mormons stopped and killed the westward pioneers and settlers that encountered the Mormons, who then took all of the traveler’s possessions.
http://en.wikipedia.org/wiki/Mountain_Meadows_massacre
3
Prof. Krugman wrote how conservatives today refuse to acknowledge the real causes of the economic stagnation: "So the true story of economic disaster, which is that it was caused by an inadequately regulated financial industry run wild and perpetuated by wrongheaded austerity policies, won’t do. "
The G.W. Bush administration, which rightly can be blamed for the unnecessary and ruinous wars, wars that have become ruinous to the U.S., as well as so many other nations in the Middle East. ... was also blameworthy for the extra expense of the Prescription Drug (Act), etc. and for failure to pay for ANYTHING with higher taxes. (Iraq's oil would pay the bill?)
Since when can you call that "austerity"? Yes, the financial industry was 'running wild', but wasn't it under W.J.Clinton, that the Banking Act of 1933, followed by the Glass–Steagall Act, were repealed?
Dr. Krugman has previously shown he's against how the financial industry consumes an unconscionable part of the nation's income.
"Instead, the story must involve things like a skills gap — it’s not lack of jobs; we have the wrong workers for this high-technology globalized era, etc., etc. — even if there’s no evidence at all that such a gap is impeding recovery." The recovery does seem to be held back, especially if U.S. citizens are being forced to train new people from countries, e.g. India, to come in and take their jobs (H-1b program).
They then have nothing to do. Their college educations go to waste too.
The G.W. Bush administration, which rightly can be blamed for the unnecessary and ruinous wars, wars that have become ruinous to the U.S., as well as so many other nations in the Middle East. ... was also blameworthy for the extra expense of the Prescription Drug (Act), etc. and for failure to pay for ANYTHING with higher taxes. (Iraq's oil would pay the bill?)
Since when can you call that "austerity"? Yes, the financial industry was 'running wild', but wasn't it under W.J.Clinton, that the Banking Act of 1933, followed by the Glass–Steagall Act, were repealed?
Dr. Krugman has previously shown he's against how the financial industry consumes an unconscionable part of the nation's income.
"Instead, the story must involve things like a skills gap — it’s not lack of jobs; we have the wrong workers for this high-technology globalized era, etc., etc. — even if there’s no evidence at all that such a gap is impeding recovery." The recovery does seem to be held back, especially if U.S. citizens are being forced to train new people from countries, e.g. India, to come in and take their jobs (H-1b program).
They then have nothing to do. Their college educations go to waste too.
7
".. Many who have been vociferous in criticizing income and wealth inequality such as Paul Krugman and Joseph Stiglitz have not pointed to the increase income inequality as the cause of the depression. Those on the left who might be the natural proponents of a more progressive tax system have not connected the dots. They have a different theory as to the cause of the depression. They are adherents to the regulatory fallacy, the belief that the depression was caused by insufficient regulation.
To determine if someone is an adherent of the regulatory fallacy ask this question: Do you believe that given the degree that the tax burden was shifted from the rich to the middle class, was there any type of regulatory policy which would have prevented the financial crisis? If they answer yes, they are adherents to the regulatory fallacy
In Paul Krugman’s 2012 book “End this Depression Now!” he comes heartbreakingly close to connecting the dots between the reduction in the progressivity of the tax system and the cycle of overinvestment that caused the depression. He states that the book is much less concerned with the cause of the depression than what should be done to end it. His prescription is fiscal stimulus focused on the spending side that has even less of a chance of being enacted than the tax cuts suggested.
Those on the right have their own version of the regulatory fallacy. They blame FNMA and the Community Reinvestment Act..."
http://seekingalpha.com/article/1543642
To determine if someone is an adherent of the regulatory fallacy ask this question: Do you believe that given the degree that the tax burden was shifted from the rich to the middle class, was there any type of regulatory policy which would have prevented the financial crisis? If they answer yes, they are adherents to the regulatory fallacy
In Paul Krugman’s 2012 book “End this Depression Now!” he comes heartbreakingly close to connecting the dots between the reduction in the progressivity of the tax system and the cycle of overinvestment that caused the depression. He states that the book is much less concerned with the cause of the depression than what should be done to end it. His prescription is fiscal stimulus focused on the spending side that has even less of a chance of being enacted than the tax cuts suggested.
Those on the right have their own version of the regulatory fallacy. They blame FNMA and the Community Reinvestment Act..."
http://seekingalpha.com/article/1543642
The ring wing survived and "won" congress and the senate despite their financial debacle that culminated in the great 2008 depression. Until enough voters understand this things will get worse for everyone but the comfortably rich (top 1-10%?). Those who want a better America will have to keep pushing against the powerful propaganda machine (Fox News and AM radio) of the right wing.
10
The cause and solution for all our problems is (are) easy: it's the lazy 47% living of "our" money, that we work so hard every day for, the Job Creators need to have the regulatory "traps" removed so that they can start all those new businesses and industries so that Cousin John can get a job and pay off his student loan, and there are too many of those poors with no fathers in the house. I come from a working-class Southern white family, and it always amazed me how their prejudices line up with the conservative Republican line, and have since I was a child. Fox News and talk radio may echo these ideas, but these Zombies have been walking for generations. What's different is how they've spread from Southern anti-Democratic reflex into the general population-- and I think that's where Fox and friends have been the lever.
BTW-- I'm one of the few liberals I know who actually attended a George Wallace rally (went with my parents.) Race wasn't mentioned, and not one of the "ideas" I heard would be out of a Tea Party meeting today. Not a single thing.
BTW-- I'm one of the few liberals I know who actually attended a George Wallace rally (went with my parents.) Race wasn't mentioned, and not one of the "ideas" I heard would be out of a Tea Party meeting today. Not a single thing.
7
How great that Britain cuts their defense budget while the USA is left alone to spend more money and troops fighting international problems. Krugman is far too polite in defining some of the double standards today. For example, we must cut tax rates and never raise taxes but we have tons of money for our military missions all across the globe.....or for example, we do not need a Draft.... despite sending the same troops to multiple deployments giving us thousands of shell shocked young people.
10
Instituting a draft would have two simultaneous results:
a) a mass immigration out of this country by some of the best and brightest young people (like my son)
b) it would hopefully get those who remain off their couches to say enough of this endless war.
It would certainly not spread the burden of deployment more evenly across the population.
a) a mass immigration out of this country by some of the best and brightest young people (like my son)
b) it would hopefully get those who remain off their couches to say enough of this endless war.
It would certainly not spread the burden of deployment more evenly across the population.
5
Nothing demolishes the fantasy of a skills gap like the spectacle of Disney importing thousands of foreigners to replace their homegrown skilled labor, except perhaps the number of STEM grads, especially those in computer science, that can't find jobs. The global economy is the story of strikes being undercut by scab labor writ large. Capitalists will do anything they can to squeeze profit at the expense of their workforces. The little bit of time after WWII in which labor was paid decently relative to shareholders and CEOs was a blip on the screen wiped out by the inevitability of globalization. No corporate entity ever paid labor fairly without being forced to do so.
18
Then US STEM grads should work for the barely above minimum wages (and a green card) that H.1.b. visa workers are happy to work for!
President Clinton increased the H.1.b. visa program quotas that now allow technically educated foreign people to go to the front of the line to get visas to enter the USA and get STEM jobs that replace US STEM-educated citizens. The H.1.b. visa holders will work for just above minimum wages, until they obtain US citizenship, and this therefore lowers the salary wages for all US STEM-educated citizens to the lowest available cost for STEM services and jobs.
The US government has also destroyed the US STEM technical human database that was previously used to create those innovations, patents, and inventions, and it will take generations to re-create that technical STEM capability that won WWII and gave US citizens a bountiful lifestyle for a couple of decades after WWII until the US Government created all of those “Free Trade Agreements.”
President Clinton increased the H.1.b. visa program quotas that now allow technically educated foreign people to go to the front of the line to get visas to enter the USA and get STEM jobs that replace US STEM-educated citizens. The H.1.b. visa holders will work for just above minimum wages, until they obtain US citizenship, and this therefore lowers the salary wages for all US STEM-educated citizens to the lowest available cost for STEM services and jobs.
The US government has also destroyed the US STEM technical human database that was previously used to create those innovations, patents, and inventions, and it will take generations to re-create that technical STEM capability that won WWII and gave US citizens a bountiful lifestyle for a couple of decades after WWII until the US Government created all of those “Free Trade Agreements.”
3
There is very little economic incentive for any US citizen college student to major in any of the science or engineering STEM fields at this time.
The jobs for STEM graduates are being eliminated from the USA and relocated overseas and/or filled by H.1.b. immigrants who will work for an H.1.b. visa at just above minimum wages and the promise of a “Green Card” when US citizens of the same qualifications want more than the McDonald hamburger flipping level compensation for that STEM work that the H.1.b. immigrants are happy to work for.
This situation needs to change for the benefit of the US economy.
The average American student normally refuses to endure the hard work, critical thinking, and intense focus that is required to achieve technical and scientific STEM educations, when higher paying less strenuous fields of study are available, and the scientific and engineering jobs after graduation are so much more stressful and demanding compared to other jobs.
The jobs for STEM graduates are being eliminated from the USA and relocated overseas and/or filled by H.1.b. immigrants who will work for an H.1.b. visa at just above minimum wages and the promise of a “Green Card” when US citizens of the same qualifications want more than the McDonald hamburger flipping level compensation for that STEM work that the H.1.b. immigrants are happy to work for.
This situation needs to change for the benefit of the US economy.
The average American student normally refuses to endure the hard work, critical thinking, and intense focus that is required to achieve technical and scientific STEM educations, when higher paying less strenuous fields of study are available, and the scientific and engineering jobs after graduation are so much more stressful and demanding compared to other jobs.
5
US citizens should demand a return to the scientific and technical excellence at all levels of our education systems that we purposefully destroyed in the past few decades with the equal outcome policies.
It is necessary to somehow re-create the human technology STEM databases that are necessary before any re-industrialization can occur as required to create any new national wealth that will correct the US balance of trade payments.
Financial resources should be spent on science and engineering educations rather than spending borrowed US dollars for Wall Street bailouts and government bureaucratic payrolls, which does almost nothing to benefit any other part of the US economy.
The USA needs to create a demand for, and provide more financial incentive for US students to major in the medical, technical, mathematical, engineering and scientific (STEM) subjects that are needed to create the technical human capability intelligence bases with the technical scientific critical thinking abilities that will be required to re-industrialize the USA and re-create the US technology base that will be needed before any re-industrialization can re-create new jobs in the USA can occur.
It is necessary to somehow re-create the human technology STEM databases that are necessary before any re-industrialization can occur as required to create any new national wealth that will correct the US balance of trade payments.
Financial resources should be spent on science and engineering educations rather than spending borrowed US dollars for Wall Street bailouts and government bureaucratic payrolls, which does almost nothing to benefit any other part of the US economy.
The USA needs to create a demand for, and provide more financial incentive for US students to major in the medical, technical, mathematical, engineering and scientific (STEM) subjects that are needed to create the technical human capability intelligence bases with the technical scientific critical thinking abilities that will be required to re-industrialize the USA and re-create the US technology base that will be needed before any re-industrialization can re-create new jobs in the USA can occur.
4
The Republican plans are very successful.
To think that their agenda is a failure because it doesn't help average Americans or the country on the whole is to not understand the GOALS of the Republican Party.
Their main goals are to help the rich, eliminate regulations that benefit the country and it's people, and weaken and shrink the government.
On the contrary, the Republicans are very successful.
To think that their agenda is a failure because it doesn't help average Americans or the country on the whole is to not understand the GOALS of the Republican Party.
Their main goals are to help the rich, eliminate regulations that benefit the country and it's people, and weaken and shrink the government.
On the contrary, the Republicans are very successful.
20
Grove, you don't look at numbers very often, do you? Only 0.5% of the world pays more for overall government on a per capita basis than United States citizens(1). The US is second only to France in welfare relative to GDP. As for regulations, we literally have cops shutting down kids' lemonade stands. Take any objective measure of the cost and scope of regulations Americans face and tell me that we're too unregulated. I can't even imagine anyone losing worse than the Republicans on domestic policies.
1) My numbers are correct. Look them up before you argue. (Yes, we spend quite a bit on military adventures but I don't really want to hear about it from a uber-hawk Hillary supporter.)
1) My numbers are correct. Look them up before you argue. (Yes, we spend quite a bit on military adventures but I don't really want to hear about it from a uber-hawk Hillary supporter.)
6
Maybe the Republican or the Democratic party should adopt a stance of "financial responsibility,” with the goal of re-industrialization and that would create taxable wealth to then save the USA from self-destruction via Federal Government deficit spending.
Deficit government spending will eventually destroy any nation’s economy, cause that government to cease to function, cause the purchasing power of that currency to approach zero, and then that nation will evolve into something resembling Greece, then Mexico, and then Somalia!
Deficit government spending will eventually destroy any nation’s economy, cause that government to cease to function, cause the purchasing power of that currency to approach zero, and then that nation will evolve into something resembling Greece, then Mexico, and then Somalia!
4
Your numbers are cherrypicked to an amazing degree, actually. i also liked the way that as per usual, you lumped all forms of "welfare," together and casually dismissed the military budget with a bitty wave.
1
Everything K says about how Serious People tell the story of economic woes and appropriate solutions can be said about how these same Serious People tell the story of public education's woes and of the appropriate solutions to our education "crisis."
The real problem is that we allow Serious People to monopolize public life. Get rid of these parasites and maybe we can get back to dealing with reality.
The real problem is that we allow Serious People to monopolize public life. Get rid of these parasites and maybe we can get back to dealing with reality.
11
Thank you again, Mr. Krugman. Taking off the gloves is the only way to combat bare-knuckle, backroom/ boardroom brawlers.
8
Each and every nation (including Britain) should constantly generate new taxable national wealth and new taxable assets in order to create or maintain the financial capability of their governments to be able to collect (confiscate) sufficient tax money to spend on their wealth consuming government activities without borrowing. This government-spending economic capability can only be available if that nation has sufficient national wealth continuously created by successful businesses available so that a portion of that taxable wealth can be confiscated in the form of taxation in order to create funds to pay for these wealth consuming government activities without borrowing money from other nations.
Since the US government at all levels is now spending all of the taxes collected plus borrowing another sum equal to more than 40% of the collected taxes, where will the money to pay for more additional government activities come from?
If and when foreigners in the industrialized wealth-creating BRIC (Brazil, Russia, India, and China) nations stop buying freshly printed paper US Treasury Bonds (loaning the US Government US Dollars) with the US dollars that they earned by making and selling things to US consumers, then the US federal government would run out of money to pay for US federal government payrolls and other wealth consuming federal government activities.
Since the US government at all levels is now spending all of the taxes collected plus borrowing another sum equal to more than 40% of the collected taxes, where will the money to pay for more additional government activities come from?
If and when foreigners in the industrialized wealth-creating BRIC (Brazil, Russia, India, and China) nations stop buying freshly printed paper US Treasury Bonds (loaning the US Government US Dollars) with the US dollars that they earned by making and selling things to US consumers, then the US federal government would run out of money to pay for US federal government payrolls and other wealth consuming federal government activities.
3
"So the true story of economic disaster, which is that it was caused by an inadequately regulated financial industry run wild and perpetuated by wrongheaded austerity policies, won’t do. Instead, the story must involve things like a skills gap"
Actually the preferred story on the right, at least here in the US, is to blame the disaster on the Community Reinvestment Act which is falsely said to have forced the banks to make all those bad loans
Actually the preferred story on the right, at least here in the US, is to blame the disaster on the Community Reinvestment Act which is falsely said to have forced the banks to make all those bad loans
3
I'm curious how Krugman can claim that the "seriously bad idea" that government to help the less fortunate is bad for the economy is "on the ropes" when a solid Republican House majority along with the usual phalanx of right wing Democrats can effectively block any such spending.
Just this week Obama offered to whittle $700 million from Medicare in order to subsidize his TPP gift to the investor class. It would seem, instead, that social programs are still on the ropes - on the canvas being counted out is more apt of an analogy.
The hyper-partisan Krugman, in his attempt to portray the Democrats of today as FDR Democrats, sacrifices his credibility, at least with with those of us who are not in denial about the sorry state of the new Democratic party.
Just this week Obama offered to whittle $700 million from Medicare in order to subsidize his TPP gift to the investor class. It would seem, instead, that social programs are still on the ropes - on the canvas being counted out is more apt of an analogy.
The hyper-partisan Krugman, in his attempt to portray the Democrats of today as FDR Democrats, sacrifices his credibility, at least with with those of us who are not in denial about the sorry state of the new Democratic party.
8
Every civilization has always tried to create sufficient privately owned taxable wealth in order for governments to confiscate some of this taxable wealth as required to create sufficient government financial resources to pay for the following services for the general public, in order to relieve the general public from being individually responsible for providing the following services:
1. Provide for the common military defense;
2. Pay for the construction of the common infrastructure elements that we all enjoy;
3. Pay for police, fire fighters, educators, and a judicial system;
4. Take care of those citizens that cannot take care of themselves;
5. Provide various nonessential government expenses such as libraries, museums, zoos, parks, hospitals, environmental cleanups, NASA, Green Energy, unemployment payments, and other nice but unnecessary feel-good services that serve the total population.
Maybe these items should be a part of the definition of civilization, even if these are just only some of the main (unwritten social contract) reasons for creating a civilization.
There are however, real limits to the amount of government expenditures that the taxpayers can afford to pay for their government services before their government goes bankrupt when the businesses leave that nation, city, state, etc., and stop paying taxes, and then the government economic capability disappears!
1. Provide for the common military defense;
2. Pay for the construction of the common infrastructure elements that we all enjoy;
3. Pay for police, fire fighters, educators, and a judicial system;
4. Take care of those citizens that cannot take care of themselves;
5. Provide various nonessential government expenses such as libraries, museums, zoos, parks, hospitals, environmental cleanups, NASA, Green Energy, unemployment payments, and other nice but unnecessary feel-good services that serve the total population.
Maybe these items should be a part of the definition of civilization, even if these are just only some of the main (unwritten social contract) reasons for creating a civilization.
There are however, real limits to the amount of government expenditures that the taxpayers can afford to pay for their government services before their government goes bankrupt when the businesses leave that nation, city, state, etc., and stop paying taxes, and then the government economic capability disappears!
7
I only wish that US spending was limited to the few items you gave above. But since we've seen the creation of over 100 new agencies under Obama's reign, and had all of those things before, I'm afraid we've gone well beyond the role of government. And the number of citizens that cannot take care of themselves only increases and our government expands their definition of 'can't take care of yourselves.' There is no way Medicaid should be available to everyone; just one example of thousands.
Liberals have lost it; they are now as bad as the far right. Both extremes are a real danger the our existence. I've not problem with anyone having an opinion, but am really tired of being ruled by extreme's on one side.
Liberals have lost it; they are now as bad as the far right. Both extremes are a real danger the our existence. I've not problem with anyone having an opinion, but am really tired of being ruled by extreme's on one side.
2
Keep repeating lies over and over and they morph into lie-truths. Anyone with an ounce of neurons would see the syntax and infer the truth about the lie. But since we only see the word following the syntax we end up with the wrong conclusion. God help us !!
1
Come on. "Everybody knows" that the crisis happened because businesses feared an Obama Presidency. And the economy has only recently recovered because businesses are anticipating the Supreme Court to overturn the job killing Obamacare and a Jeb Bush Presidency in 2016. There really can't be any other explanation.
And I almost forgot one thing ... ISIS.
And I almost forgot one thing ... ISIS.
3
The Washington Post (not to worry, NYT, I still love you best) used to have a contest where readers were invited to change one letter of a real word and then offer a definition of the newly minted hybrid. My favorite, from a few years ago, is appropos of Dr. Krugman's point today (and many other days, bless his heart, he's trying). That word is: ``bozone,'' as in ``bozone layer,'' defined as: ``The substance surrounding stupid people that stops bright ideas from penetrating.''
Now, not all people who worry about deficits are stupid. Some of them are actually quite bright. By worrying about deficits _ or more accurately, by getting their puppets to pretent to worry about it for them, in Congress _ they've managed simultaneously to ensure their ever-more-obscene prosperity and the country's decline. Congrats to you! When you see him, you can ask King Pyrrhus what went wrong.
Now, not all people who worry about deficits are stupid. Some of them are actually quite bright. By worrying about deficits _ or more accurately, by getting their puppets to pretent to worry about it for them, in Congress _ they've managed simultaneously to ensure their ever-more-obscene prosperity and the country's decline. Congrats to you! When you see him, you can ask King Pyrrhus what went wrong.
2
Why don't you blame President Clinton for creating NAFTA, granting MFN (and then PNTR) to Communist China, which allowed and then economically required that US businesses move as many of the higher paying US manufacturing jobs as possible from their US factories to Communist China in order to reduce manufacturing costs!
Almost all of the US manufacturing relocated to Communist China within a few years after President Clinton unilaterally granted MFN trade status to Communist China.
Google "Chinagate" and "Johnny Chung" for more information.
The manufacturing of almost everything else that I can think of has relocated to Communist China.
George W. Bush created fourteen additional Free Trade Agreements (with Jordan, Morocco, and other young democracies of Central America).
President Obama then created all of those multiple new Free Trade Agreements with South Korea, Vietnam, Brunei, Singapore, Malaysia, New Zealand, Australia, Chile, and Peru plus several other Asian and South American nations that economically required that US jobs be relocated to those foreign nations?
Almost all of the US manufacturing relocated to Communist China within a few years after President Clinton unilaterally granted MFN trade status to Communist China.
Google "Chinagate" and "Johnny Chung" for more information.
The manufacturing of almost everything else that I can think of has relocated to Communist China.
George W. Bush created fourteen additional Free Trade Agreements (with Jordan, Morocco, and other young democracies of Central America).
President Obama then created all of those multiple new Free Trade Agreements with South Korea, Vietnam, Brunei, Singapore, Malaysia, New Zealand, Australia, Chile, and Peru plus several other Asian and South American nations that economically required that US jobs be relocated to those foreign nations?
3
Does anyone know what policy support Clinton received in return for supporting NAFTA? Politics is about horse trading and I'd like to know if there were any definite political concessions he gained from his NAFTA support.
3
Why did our elected presidents and congressmen create all of these "free trade legislation" laws that economically required US businesses to relocate as many US jobs as possible to foreign nations!
How do you think these free trade agreements were created?
Do you think that maybe the foreign product manufacturers that export consumer products to the USA might have paid professional US lobbyists to spend hundreds of thousands of US dollars on wine, food, women, song, pre-paid vacations in Spain, cash, pre-paid sexual services, corporate jobs for the (otherwise unemployable) children/wives/girlfriends of enough of the US senators and US congressmen (and their congressional aides who actually control the members of congress) plus campaign contributions to influence/entice (bribe) enough of our Republican and Democratic US presidents, congressmen, and senators for the past 20 years to create all of that "Free Trade Agreement" legislation that allowed, caused, and economically required our businesses to take advantage of the lower labor costs, lower electrical energy costs, lower business taxes, lower payroll taxes to pay for health care costs, lower unemployment insurance costs, lower environmental manufacturing costs and other anti-business costs that are not required in various foreign countries with fewer anti-business laws than are/were applicable to businesses in the USA?
How do you think these free trade agreements were created?
Do you think that maybe the foreign product manufacturers that export consumer products to the USA might have paid professional US lobbyists to spend hundreds of thousands of US dollars on wine, food, women, song, pre-paid vacations in Spain, cash, pre-paid sexual services, corporate jobs for the (otherwise unemployable) children/wives/girlfriends of enough of the US senators and US congressmen (and their congressional aides who actually control the members of congress) plus campaign contributions to influence/entice (bribe) enough of our Republican and Democratic US presidents, congressmen, and senators for the past 20 years to create all of that "Free Trade Agreement" legislation that allowed, caused, and economically required our businesses to take advantage of the lower labor costs, lower electrical energy costs, lower business taxes, lower payroll taxes to pay for health care costs, lower unemployment insurance costs, lower environmental manufacturing costs and other anti-business costs that are not required in various foreign countries with fewer anti-business laws than are/were applicable to businesses in the USA?
2
I cannot think of any 1992 politician, union leader, businessman, government bureaucrat, union boss or anyone else speaking out against or even remotely objecting to President Clinton's promise to create NAFTA if he was elected, except for third party presidential candidate Ross Perot.
Nobody objected to any of President Clinton's later free trade agreements and/or President Clinton's granting of PNTR trade status for Communist China that relocated US jobs and US manufacturing businesses to third world nations.
For those of you who are too young to remember the 1992 presidential election, Ross Perot was a rich guy who looked like Alfred E Newman from the Mad Magazine comic books and talked through his nose.
He ran as a third party candidate against President Bush 41 and President Bill Clinton in 1992 who were both for creation of NAFTA, and he got a lot of the popular votes for his position of opposing NAFTA. He had the right message but he was the wrong messenger.
He was not attractive, and I sadly believe that a lot of the American people vote based upon looks more than intelligence or policy.
Ross Perot had a lot of graphs and charts to indicate his points.
I remember him saying that "NAFTA will suck the remaining jobs out of the USA."
Ross Perot might have been the last chance to save US jobs, US industry and the US economy.
Ross Perot also said, "We need to keep the high tech jobs, it is better than being a nation of chicken farmers.”
Nobody objected to any of President Clinton's later free trade agreements and/or President Clinton's granting of PNTR trade status for Communist China that relocated US jobs and US manufacturing businesses to third world nations.
For those of you who are too young to remember the 1992 presidential election, Ross Perot was a rich guy who looked like Alfred E Newman from the Mad Magazine comic books and talked through his nose.
He ran as a third party candidate against President Bush 41 and President Bill Clinton in 1992 who were both for creation of NAFTA, and he got a lot of the popular votes for his position of opposing NAFTA. He had the right message but he was the wrong messenger.
He was not attractive, and I sadly believe that a lot of the American people vote based upon looks more than intelligence or policy.
Ross Perot had a lot of graphs and charts to indicate his points.
I remember him saying that "NAFTA will suck the remaining jobs out of the USA."
Ross Perot might have been the last chance to save US jobs, US industry and the US economy.
Ross Perot also said, "We need to keep the high tech jobs, it is better than being a nation of chicken farmers.”
1
What Krugman try to explain all these years comes down, Naomi Klein's shock doctrine.
We as a society coming out from one crisis to other loosing important resources and opportunities, because other side is taking away one brick at a time.
Let's accept , with Reagan and Thatcher, workers unions started to disappear, and lost their appeal on the society. after 2008 this cycle is almost completed, unions are anymore is a hump on the back nothing else. inch by inch our life is changing and 1% is slowly molding their empires.
After all, for middle class change is not positive , it is negative. that is the bottom line.
We as a society coming out from one crisis to other loosing important resources and opportunities, because other side is taking away one brick at a time.
Let's accept , with Reagan and Thatcher, workers unions started to disappear, and lost their appeal on the society. after 2008 this cycle is almost completed, unions are anymore is a hump on the back nothing else. inch by inch our life is changing and 1% is slowly molding their empires.
After all, for middle class change is not positive , it is negative. that is the bottom line.
4
"All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services ...., a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable. "
Franklin Delano Roosevelt,
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services ...., a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable. "
Franklin Delano Roosevelt,
6
The constant theme of Prof. K's recent columns is the intellectual dishonesty that seems to underlie much of current political and economic discourse. People who should know better twist facts and reality in order to promote the ideas and policies of those in economic power.
As he points out in the case of Britain, they are enabled by a news media who report many of the questionable "zombie" ideas as fact, in keeping with the political agenda of their owners. Fortunately, I think Prof K.'s columns on this topic are having an effect in this country, as they are forcing news commentators to be more careful with their facts and arguments on economic topics.
As he points out in the case of Britain, they are enabled by a news media who report many of the questionable "zombie" ideas as fact, in keeping with the political agenda of their owners. Fortunately, I think Prof K.'s columns on this topic are having an effect in this country, as they are forcing news commentators to be more careful with their facts and arguments on economic topics.
3
Actually, a daily podcast and a massive social media blitz would help.
1
No one is against spending for the "less fortunate".
Why is it always the "little" people who are invoked when the "big" people want to spend more and yet they never seem to prosper or escape "little people...ness. When the "less fortunate", to control them, are defined by the loathsome sycophants in government as anyone who can be bought with crumbs. Thus elevating anyone who lies cheats and steals without getting caught i.e. Big Corporations, Big Labor. Big Politics, or anyone in government who lives and breaths to curry favor with higher ups and subverts the law, doesn't pay taxes and the like... We, as well as most of the worlds honest, get a little testy.
Why is it always the "little" people who are invoked when the "big" people want to spend more and yet they never seem to prosper or escape "little people...ness. When the "less fortunate", to control them, are defined by the loathsome sycophants in government as anyone who can be bought with crumbs. Thus elevating anyone who lies cheats and steals without getting caught i.e. Big Corporations, Big Labor. Big Politics, or anyone in government who lives and breaths to curry favor with higher ups and subverts the law, doesn't pay taxes and the like... We, as well as most of the worlds honest, get a little testy.
1
There's no "Big Labor" anymore. Haven't you heard?
3
And what percentage of the UK media does Rupert Murdoch control?
1
true the 1980s have cast a long shadow but it can't last forever.
Follow the money. Economic recovery is slow in Europe and the US. Greece is a basket case. Yet, the seriously bad ideas are working well for a small group of people who have enough money and influence to keep the bad ideas alive. The same process dominates attempts to mitigate climate change and the same rule applies: follow the money.
3
That (universal) bad idea is government deficit spending!
Professor Krugman, Why are you always recommending that the US government borrow (actually print and sell more paper US Treasury bonds just as the Greek government is doing) more money from individuals in the wealth-creating industrialized nations and then spend that money on government activities that will not create any more taxable national wealth.
New taxable national wealth created by the businesses would be subject to confiscation via taxation by the various governmental taxing authorities to pay the (increasing) cost of our government activities.
The Greek Government was following your recommendations, and that is why they are bankrupt today!
As the US Government continues to "increase the National Debt" with government spending, why should the US citizens expect a different result?
Professor Krugman, Why are you always recommending that the US government borrow (actually print and sell more paper US Treasury bonds just as the Greek government is doing) more money from individuals in the wealth-creating industrialized nations and then spend that money on government activities that will not create any more taxable national wealth.
New taxable national wealth created by the businesses would be subject to confiscation via taxation by the various governmental taxing authorities to pay the (increasing) cost of our government activities.
The Greek Government was following your recommendations, and that is why they are bankrupt today!
As the US Government continues to "increase the National Debt" with government spending, why should the US citizens expect a different result?
2
The U.S. was the only country to employ deficit spending. Europe stuck with austerity. We are much better off than Europe.
Look as well at the example from 1937. Government spent its way out of the depression. The economy after some time was chugging along in a much better state - so much so that the govt was worried about inflation. So, they put the brakes on spending and - voila - crashed back into depression. To say that government spending is a universally bad idea is ignoring history.
Look as well at the example from 1937. Government spent its way out of the depression. The economy after some time was chugging along in a much better state - so much so that the govt was worried about inflation. So, they put the brakes on spending and - voila - crashed back into depression. To say that government spending is a universally bad idea is ignoring history.
While Dr. Krugman writes about the same column twice a week since 2009, I still read it and I am starting to think that they could be what remains of a middle class bulwark against these seriously bad ideas. That said, I think it's possible that the pound currently holds up only because the EU is doing so badly. The UK problems can get political quite quickly with services constituting 80% of their GDP and banking to lead the recovery. The Brexit discussions will be most illuminating.
I do not know why you, or anyone else, could refer to the Gross National Domestic Product (GDP) of any nation as being any indication of that nation’s economic strength, unless the expense and the economic activity of spending tax collections plus borrowed money on wealth-consuming government services such as infrastructure improvements, social security, wars, law enforcement, water and sewers, streets and bridges, fire protection, welfare, unemployment benefits, education, welfare, retirement pensions, high speed rail, free medical services, housing, wars, social services, pork barrel projects, tax-funded PAY TO PLAY government contracts, bureaucratic jobs, government employee payrolls, and other similar wealth consuming government services that are paid for with tax collections are included into that GDP number.
A nation's GDP is an indication of the amount of a nation’s economic activity, and that GDP has nothing to do with that nation’s economic strength or the ability of that nation to repay their national debt, unless the cost of the wealth consuming government activity is subtracted from that total GDP.
That part of the GDP activity that was government spending of taxpayer money to pay for wealth consuming government services does not produce any new national wealth that the nation could be taxed in order to collect tax money to pay for government services?
A nation's GDP is an indication of the amount of a nation’s economic activity, and that GDP has nothing to do with that nation’s economic strength or the ability of that nation to repay their national debt, unless the cost of the wealth consuming government activity is subtracted from that total GDP.
That part of the GDP activity that was government spending of taxpayer money to pay for wealth consuming government services does not produce any new national wealth that the nation could be taxed in order to collect tax money to pay for government services?
2
This well-known argument would stand on at least half a foot if I had made comparisons between countries on the basis of their GDPs. I did not. Relative economic activies: 80% services and only 10% industry means that their primary export is banking with the obvious consequences for a pound strategy.
elmueador,
I thought that you said, "The UK problems can get political quite quickly with services constituting 80% of their GDP and banking to lead the recovery."
We must have a strong US wealth creating STEM manufacturing economy or we will not have the wealth and other resources in the hands of the wealthy available for the government to confiscate in sufficient amounts to care for those that cannot care for themselves.
We cannot all flip hamburgers for each other, sell each other life insurance, sue each other, and clean each others toilets without paying somebody else to make the things that are necessary to keep ourselves alive. (Food, shelter, clothing)
I think that we have already sacrificed our children by obligating them and future unborn generations to work harder than ourselves and repay these US Treasury Bonds when they become due, after we spent the revenues from these bond sales on various wealth consuming government activities.
We took the revenue from those US bond sales and then spent that money on government activities that cost more than our tax collections!
Maybe the future wars will be fought by attacking each other's economies with economic actions instead of destroying armies and war making capabilities with bullets and bombs.
Maybe that war has already started and maybe the US economy has lost the first few battles!
Maybe that was the main reason that the Allies defeated Germany, Italy, and Japan in WWII.
I thought that you said, "The UK problems can get political quite quickly with services constituting 80% of their GDP and banking to lead the recovery."
We must have a strong US wealth creating STEM manufacturing economy or we will not have the wealth and other resources in the hands of the wealthy available for the government to confiscate in sufficient amounts to care for those that cannot care for themselves.
We cannot all flip hamburgers for each other, sell each other life insurance, sue each other, and clean each others toilets without paying somebody else to make the things that are necessary to keep ourselves alive. (Food, shelter, clothing)
I think that we have already sacrificed our children by obligating them and future unborn generations to work harder than ourselves and repay these US Treasury Bonds when they become due, after we spent the revenues from these bond sales on various wealth consuming government activities.
We took the revenue from those US bond sales and then spent that money on government activities that cost more than our tax collections!
Maybe the future wars will be fought by attacking each other's economies with economic actions instead of destroying armies and war making capabilities with bullets and bombs.
Maybe that war has already started and maybe the US economy has lost the first few battles!
Maybe that was the main reason that the Allies defeated Germany, Italy, and Japan in WWII.
2
No one ever examines very closely the psychology of the mind set of the "average" American in connection with the far right. I wish to point out that America before WWII was firmly set against war. Not happy with incompetent , insipid and even venal republican administrations, they elected FDR to right the country on its feet again. And then there was WWII. It demanded and got the trust, obedience, and cooperation of its citizen soldiers to win the war. War over and the mind set lingered in the American psyche. No more demonstrations against war for 20 years.Depend on the democratic congress to look out for the American public.And then the fly in the ointment Dwight Eisenhower. Supreme American commander. Forget politics this is a man you can trust. And then our leaders took us to Vietnam. 56,000 dead with untold casualties and still that mind set told us you can lick the world.
Republicans pandered to our patriotism, democrats to our common sense and still we supported Nixon and the war. As the sixties generation ages, it frets over all of its possessions. So afraid are we of losing our treasures, we have sold our souls to the right.Yes I believe the reasoning of Paul Krugman,
but I know that until there is a change in the average American psyche nothing will happen.
Republicans pandered to our patriotism, democrats to our common sense and still we supported Nixon and the war. As the sixties generation ages, it frets over all of its possessions. So afraid are we of losing our treasures, we have sold our souls to the right.Yes I believe the reasoning of Paul Krugman,
but I know that until there is a change in the average American psyche nothing will happen.
3
dirksenshoe,
Future wars might also (will probably) be industrial wars where the nation with the most wealth-creating industrial-manufacturing production will win the economic war by producing more national wealth. Some people say that was how the USA won WWII.
Instead of Russian and Chinese armies conquering the USA, Russian and Communist Chinese individuals and/or businesses are using the US dollars that we paid them for making the consumer products that we imported from them and consumed, to purchase title to (corporations that own) privately owned businesses, factories, casinos, hotels, farms, land, ports, refineries, forests, ports, breweries, distilleries, and other privately owned national wealth and other assets located in the USA that were created by previous US generations prior to de-industrialization, instead of redeeming the US dollars and the freshly printed paper US Treasury Bonds that they earned by making and selling things to US consumers with gold from Ft. Knox or the NYC federal reserve.
These purchases are allowed instead of redeeming these freshly printed paper US Treasury Bonds (and electronic US dollar credits) with gold from Ft. Knox or the NYC Federal Reserve.
When people from the recently industrialized nations own most all the assets in the USA, these foreigners will then be the main (only) source of jobs for US citizens.
Future wars might also (will probably) be industrial wars where the nation with the most wealth-creating industrial-manufacturing production will win the economic war by producing more national wealth. Some people say that was how the USA won WWII.
Instead of Russian and Chinese armies conquering the USA, Russian and Communist Chinese individuals and/or businesses are using the US dollars that we paid them for making the consumer products that we imported from them and consumed, to purchase title to (corporations that own) privately owned businesses, factories, casinos, hotels, farms, land, ports, refineries, forests, ports, breweries, distilleries, and other privately owned national wealth and other assets located in the USA that were created by previous US generations prior to de-industrialization, instead of redeeming the US dollars and the freshly printed paper US Treasury Bonds that they earned by making and selling things to US consumers with gold from Ft. Knox or the NYC federal reserve.
These purchases are allowed instead of redeeming these freshly printed paper US Treasury Bonds (and electronic US dollar credits) with gold from Ft. Knox or the NYC Federal Reserve.
When people from the recently industrialized nations own most all the assets in the USA, these foreigners will then be the main (only) source of jobs for US citizens.
1
Our own conservative republicans have concocted equally imaginative excuses for this country's economic collapse and trillion dollar deficits which, not surprisingly, absolve conservative republicans of all responsibility. Instead, they blame the poor and those bad old liberal democrats. It's like muggers blaming the victims for being mugged.
4
It seems to me that we have entered into a period of danger in which any pronouncement said to be based on economics seems to be shielded from any critical scrutiny as if by being a statement about "economics" we are not at the same time discussing the fashionable politics of the moment of the wealthy and privileged.
As soon as any politician stands up and uses a few economic terms their expertise in economic matters goes unchallenged as if just using economic terms rendered them experts. But…they are not experts and they know it , unfortunately the public excludes itself by deferring to the "experts ". This is an unfortunate turn of events as economics is an area that needs public discussion and public input in order to effect a true democratization of our political system .
It is still true that using economic terms you can fool some of the people, some of the time but you cannot fool all of the people all of the time. Unfortunately elections very often are won by fooling enough people to make a majority. It can only be hoped that in time voices will rise that challenge the types of blanket economic statements that fill the airwaves and make it sound as if economic statements were not debatable topics. Until those debates take place and the public has access to alternative economic views the danger will remain that economic statements will have the aura of truth and not opinion .
As soon as any politician stands up and uses a few economic terms their expertise in economic matters goes unchallenged as if just using economic terms rendered them experts. But…they are not experts and they know it , unfortunately the public excludes itself by deferring to the "experts ". This is an unfortunate turn of events as economics is an area that needs public discussion and public input in order to effect a true democratization of our political system .
It is still true that using economic terms you can fool some of the people, some of the time but you cannot fool all of the people all of the time. Unfortunately elections very often are won by fooling enough people to make a majority. It can only be hoped that in time voices will rise that challenge the types of blanket economic statements that fill the airwaves and make it sound as if economic statements were not debatable topics. Until those debates take place and the public has access to alternative economic views the danger will remain that economic statements will have the aura of truth and not opinion .
2
I think that all US citizens should all learn and understand that economics, the US trade deficit, the federal government spending deficit, jobs for Americans, and the buying power or value of the US dollar are all interrelated, very simple, very easily understood, and directly affects each US citizen’s life.
Each of these principles generally affects each of the others, and each is very important.
These subjects need to be understood by the general public.
Economics is not that complicated.
These economic principals are interlocked with simple and easily understandable cause-and-effect principals of various economic action options that can be totally understood by almost any high school graduate, and/or most high school dropouts.
Only a very simple understanding of high school mathematics is needed to learn economics. No science is required either.
Most government activities only consume the wealth in the form of taxes that was previously confiscated from their working citizens and these government activities do not leave any (taxable) national wealth behind after the government spends that money on wars, police, firemen, infrastructure, environmental cleanups, etc.
Government activities do not ever generate or create any wealth, except under the socialist and communist forms of government where the government owns and operated the wealth creating activities, and those governments have not ever been successful for very long!
Each of these principles generally affects each of the others, and each is very important.
These subjects need to be understood by the general public.
Economics is not that complicated.
These economic principals are interlocked with simple and easily understandable cause-and-effect principals of various economic action options that can be totally understood by almost any high school graduate, and/or most high school dropouts.
Only a very simple understanding of high school mathematics is needed to learn economics. No science is required either.
Most government activities only consume the wealth in the form of taxes that was previously confiscated from their working citizens and these government activities do not leave any (taxable) national wealth behind after the government spends that money on wars, police, firemen, infrastructure, environmental cleanups, etc.
Government activities do not ever generate or create any wealth, except under the socialist and communist forms of government where the government owns and operated the wealth creating activities, and those governments have not ever been successful for very long!
1
The "balanced budget" has become a kind of religious doctrine. Religion isn't supposed to have any factual basis -- it's faith-based -- so if voters like it, we need to do it. Of course, Republican presidents have in fact run up huge deficits, but the point is that they won office, not that they actually believe in the Balanced Budget doctrine.
1
The only conclusion one can come to is that liberal utilitarianism is dead and that the country is being run by a wealthy ruling class with the goal of primarily benefiting the wealthy.
8
i'd suggest that this isn't exactly an intellectual problem as such, and that there isn't any way to get the folks who simply believe to look at hard evidence and change their minds.
In essence, the problem is exactly the one I saw during a televised debate between Cornel West and Pat Robertson: Robertson insisted and insited on two incompatible things--laissez-faire capitalism (apparently part of God's Plan) and charity for the poor (seems Gid approves of that, too), refused to budge on either, until West asked:
"but brother, don't you see that your economics directly contradict your faith?"
Nope, he most emphatically did not.
Now, I'm not saying that this is all about Christianity. i'm saying that looking at evidence and changing one's mind, in this case, means changing a whole cascade of views and ideas.
discounting the obvious lying and politicking--those, one can work with--the prob is that if the Right were to look at evidence and rethink, they would in effect have to stop being Right.
Not going to happen. Instead, they'll work as hard to "save the phenomena" as any Aristotelian faced with Copernicus.
In essence, the problem is exactly the one I saw during a televised debate between Cornel West and Pat Robertson: Robertson insisted and insited on two incompatible things--laissez-faire capitalism (apparently part of God's Plan) and charity for the poor (seems Gid approves of that, too), refused to budge on either, until West asked:
"but brother, don't you see that your economics directly contradict your faith?"
Nope, he most emphatically did not.
Now, I'm not saying that this is all about Christianity. i'm saying that looking at evidence and changing one's mind, in this case, means changing a whole cascade of views and ideas.
discounting the obvious lying and politicking--those, one can work with--the prob is that if the Right were to look at evidence and rethink, they would in effect have to stop being Right.
Not going to happen. Instead, they'll work as hard to "save the phenomena" as any Aristotelian faced with Copernicus.
3
All nations, including the USA, should return to basic economic principles and realize/understand that non-government jobs for the working class citizens and privately held taxable national wealth available to be confiscated to pay for common wealth consuming government activities are only made, created, and/or acquired when the members of a family or the citizen businessmen of a nation, state, city, island, tribe, school district, hospital district, etc., perform one or more of the following wealth creating tasks:
1. Plant, grow, and/or harvest something of commercial value from the earth;
2. Extract something of commercial value from the earth;
3. Manufacture something of commercial value that is consumable;
4. Construct a building that is permanently useful for rental income;
5. Tourism income from foreign tourists;
6. Provide professional State licensed services such as doctors, lawyers, architects, engineers, land surveyors, and certified public accountants, etc.;
7. Provide other services such as plumbers, electricians, auto mechanics, aircraft mechanics, HVAC mechanics, barbers, real estate agents, financial advisers and etc.;
8. Collect payment for patent and copyright use;
9. Buy things from foreigners in foreign nations, transport them to another foreign nation, and then sell those things to people in that other foreign nation at a profit;
Every nation must realize that they must protect their taxable wealth creating capability or "ALL IS LOST."
1. Plant, grow, and/or harvest something of commercial value from the earth;
2. Extract something of commercial value from the earth;
3. Manufacture something of commercial value that is consumable;
4. Construct a building that is permanently useful for rental income;
5. Tourism income from foreign tourists;
6. Provide professional State licensed services such as doctors, lawyers, architects, engineers, land surveyors, and certified public accountants, etc.;
7. Provide other services such as plumbers, electricians, auto mechanics, aircraft mechanics, HVAC mechanics, barbers, real estate agents, financial advisers and etc.;
8. Collect payment for patent and copyright use;
9. Buy things from foreigners in foreign nations, transport them to another foreign nation, and then sell those things to people in that other foreign nation at a profit;
Every nation must realize that they must protect their taxable wealth creating capability or "ALL IS LOST."
2
And then if their citizen businessmen trade, sell, lease, or rent these items and/or services to parties outside of their family (or outside of their nation), in return for a net transfer of gold, currency, or commodities from other parties outside of their family into their own family, that entire family (state or nation) is enriched and accumulates taxable national wealth.
The members of any family, tribe, city, state, or nation can reflect the amount of their real taxable national wealth and financial security as a total of their net positive accumulation of privately owned taxable wealth including grain, gold, cattle, jewels, land, buildings, hotels, casinos, factories, commodities, and/or other marketable products that is available for government confiscation via taxes to pay for government services.
These taxable assets are then also available to be used for economic security for reserve use in times of emergency, to raise the standard of living for the members of that family and also to pay for military defense, police, firemen, and teachers, to take care of those family members that cannot take care of themselves, to construct infrastructure, and etc.
This wealth is then also becomes available as collateral (products, commodities, and/or title to locally in-country located real estate assets) to redeem any printed paper currency that they might care to issue.
The members of any family, tribe, city, state, or nation can reflect the amount of their real taxable national wealth and financial security as a total of their net positive accumulation of privately owned taxable wealth including grain, gold, cattle, jewels, land, buildings, hotels, casinos, factories, commodities, and/or other marketable products that is available for government confiscation via taxes to pay for government services.
These taxable assets are then also available to be used for economic security for reserve use in times of emergency, to raise the standard of living for the members of that family and also to pay for military defense, police, firemen, and teachers, to take care of those family members that cannot take care of themselves, to construct infrastructure, and etc.
This wealth is then also becomes available as collateral (products, commodities, and/or title to locally in-country located real estate assets) to redeem any printed paper currency that they might care to issue.
2
Walking my dog the other day when two rather scroungy looking me approached. I told my dog to stay close and started walking away when one of the men stepped in front of me...scaring me half to death. Then I noticed that the man had Sheriff's ID hanging on the front of his threadbare coat. The two men were looking for (drum roll here) HOMELESS PEOPLE! I guess they are what you call undercover agents (except when the man's badge glitters). I was a bit taken aback because the area where we were walking is pretty shabby...and I wondered if they thought I was homeless.
It seems there is a high end restaurant just on the other side of the trees along the trail where we stood and the owners were complaining about homeless sorts hanging around the fountain out front, and sometimes washing their feet in it.
What does my story have to do with Mr. Krugman's column? Well, for starters, a one bedroom apartment rents for $1,900 a month in our area, so there are sure to be some homeless around since that's more than many people make in a month. And, wouldn't it make more sense to spend tax money providing homes for the poor, than to pay high salaries to detectives to harras the poor? Shades of Tiny Tim's world...Are there not poor houses for the wretched?
It seems there is a high end restaurant just on the other side of the trees along the trail where we stood and the owners were complaining about homeless sorts hanging around the fountain out front, and sometimes washing their feet in it.
What does my story have to do with Mr. Krugman's column? Well, for starters, a one bedroom apartment rents for $1,900 a month in our area, so there are sure to be some homeless around since that's more than many people make in a month. And, wouldn't it make more sense to spend tax money providing homes for the poor, than to pay high salaries to detectives to harras the poor? Shades of Tiny Tim's world...Are there not poor houses for the wretched?
7
Dr. Krugman has written many times on "zombie" ideas that wont die despite empirical evidence that discredits them. While I do not discount the impact of new media, Republican party etc... my question is why these idea "feel" correct to so many people. I think that it is hard not to discount the way that anecdotal examples of government waste or individuals who abuse the system can make people more willing to accept the narrative that government spending is to blame for economic woes.
45
Greek Government Deficit Spending is the only cause of the pending Greek economy callapse!
Severe austerity will then be forced onto all Greek citizens when their Greek federal government deficit spending destroys the Greek economy and most all of the government jobs, government services, and other government programs at every level disappears. The Greek nation will then evolve into something resembling Somalia.
Severe austerity will then be forced onto all Greek citizens when their Greek federal government deficit spending destroys the Greek economy and most all of the government jobs, government services, and other government programs at every level disappears. The Greek nation will then evolve into something resembling Somalia.
1
European austerity is a myth. From a left leaning editorial board:
http://www.bloombergview.com/articles/2014-08-19/european-austerity-is-a...
http://www.bloombergview.com/articles/2014-08-19/european-austerity-is-a...
2
The following seem to me to be Seriously Bad Ideas:
a) Money is wealth.
b) Makers create jobs, consumers destroy them.
c) Unregulated markets are equivalent to free markets.
d) Externals are cost free.
e) The purpose of business is to make a profit.
f) A dollar spent is a dollar gone forever.
g) It's better to do unnecessary work than not to work at all.
I could go on, unfortunately.
a) Money is wealth.
b) Makers create jobs, consumers destroy them.
c) Unregulated markets are equivalent to free markets.
d) Externals are cost free.
e) The purpose of business is to make a profit.
f) A dollar spent is a dollar gone forever.
g) It's better to do unnecessary work than not to work at all.
I could go on, unfortunately.
7
It's tough to be fact-based and conservative these days, since all their economic and budgetary dogma has been utterly refuted by the facts. Increasingly, fact-based reasoning defines the Left.
In other words, if you use facts from credible sources to arrive at an opinion or conclusion, you are a Lefty. The media perpetuates this because it gets paid to keep the fight going, rather than declaring the Liberals the winner on all things economic and budgetary and ignoring everything conservatives advocate as dangerous to the prosperity of the bottom 99.9%.
In other words, if you use facts from credible sources to arrive at an opinion or conclusion, you are a Lefty. The media perpetuates this because it gets paid to keep the fight going, rather than declaring the Liberals the winner on all things economic and budgetary and ignoring everything conservatives advocate as dangerous to the prosperity of the bottom 99.9%.
7
As to the actual causes of the Great Recession I am mindful of the proverb "For want of a Nail."
Clinton and the Republican legislature came close to codifying a similar condition of budget restraint. It was not so much that they actually had several years of budget surplus, but that they convinced the sovereign funds and central banks (most notably the OPEC banks and funds and the Chinese) that the United States intended to pay down the debt.
It was this perceived intention that started the search for a substitute for US Treasury debt that eventually led to collateralized mortgaged backed securities and all the machinations of an ad hoc market in weird and wonderful imaginary debt instruments. Doomed to fail.
(We should really project what this bodes for even weirder machinations such as BitCoin)
So yes, Mr. Osborne's plans are strange and ultimately counterproductive for Britain. Thank goodness Britain's economy is so much smaller than ours, for it would take a similar plan on the scale of America, China or the Eurozone to topple the world economy once again. But then again whose to say which nail on which hoof will lead to the next headless crown?
Clinton and the Republican legislature came close to codifying a similar condition of budget restraint. It was not so much that they actually had several years of budget surplus, but that they convinced the sovereign funds and central banks (most notably the OPEC banks and funds and the Chinese) that the United States intended to pay down the debt.
It was this perceived intention that started the search for a substitute for US Treasury debt that eventually led to collateralized mortgaged backed securities and all the machinations of an ad hoc market in weird and wonderful imaginary debt instruments. Doomed to fail.
(We should really project what this bodes for even weirder machinations such as BitCoin)
So yes, Mr. Osborne's plans are strange and ultimately counterproductive for Britain. Thank goodness Britain's economy is so much smaller than ours, for it would take a similar plan on the scale of America, China or the Eurozone to topple the world economy once again. But then again whose to say which nail on which hoof will lead to the next headless crown?
5
Good points Michael O'Neill,
Any Sovereign Nation's freshly printed paper currency, Treasury Bonds, or any electronic credits, Monopoly Money, Bitcoins, and/or even a silly new Sovereign Nation platinum coin made out of a few hundred dollars of Platinum and printed (minted) with "One Trillion US Dollars" on the face has little or NO VALUE unless it can be exchanged for something else of real value such as gold, silver, grain, cattle, land, real estate, hotels, casinos, farms, etc.
Certificates of ownership for petroleum, gold, silver, grain, cattle, are items of value a remote secure location are the same as title to privately owned businesses, movie houses, factories, casinos, hotels, farms, land, ports, refineries, forests, ports, breweries, distilleries, and etc. were the first paper currencies.
Any and every currency has to be redeemable for something of value, or it loses all of its value.
The US Dollar is now essentially only redeemable primarily for existing privately owned US located assets and title to real property assets created by previous US generations instead of (non-existant) Gold from the US Treasury.
Any Sovereign Nation's freshly printed paper currency, Treasury Bonds, or any electronic credits, Monopoly Money, Bitcoins, and/or even a silly new Sovereign Nation platinum coin made out of a few hundred dollars of Platinum and printed (minted) with "One Trillion US Dollars" on the face has little or NO VALUE unless it can be exchanged for something else of real value such as gold, silver, grain, cattle, land, real estate, hotels, casinos, farms, etc.
Certificates of ownership for petroleum, gold, silver, grain, cattle, are items of value a remote secure location are the same as title to privately owned businesses, movie houses, factories, casinos, hotels, farms, land, ports, refineries, forests, ports, breweries, distilleries, and etc. were the first paper currencies.
Any and every currency has to be redeemable for something of value, or it loses all of its value.
The US Dollar is now essentially only redeemable primarily for existing privately owned US located assets and title to real property assets created by previous US generations instead of (non-existant) Gold from the US Treasury.
2
Of course, Obamacare for some is a good idea because "free" health care for those who can't afford it, paid for by those who can just barely... is "right" and "good".
It is a system where the benefits to those who are enjoying the fruits of others' labor is cited as proof that "it works."
But when the Left claims something "works" it can always be asked: "and against whom is it working?"
A seriously bad idea is often buttressed by political ideologies that have nothing to do with the economics.
In the case of Obamacare, the increasing costs, the drag on the system of a whole is easy to spot.
http://reason.com/archives/2015/06/12/outside-the-liberal-la-la-land-oba...
Unless you insist on only seeing "the good" - cherry picked for the millionth iteration of the same basic argument about the statist Left being right because, in essence, it is morally smug.
It is a system where the benefits to those who are enjoying the fruits of others' labor is cited as proof that "it works."
But when the Left claims something "works" it can always be asked: "and against whom is it working?"
A seriously bad idea is often buttressed by political ideologies that have nothing to do with the economics.
In the case of Obamacare, the increasing costs, the drag on the system of a whole is easy to spot.
http://reason.com/archives/2015/06/12/outside-the-liberal-la-la-land-oba...
Unless you insist on only seeing "the good" - cherry picked for the millionth iteration of the same basic argument about the statist Left being right because, in essence, it is morally smug.
4
Of course Obamacare was a sell out to a conservative idea, supporting for profit insurance companies with subsidies. Any problems with Obamacare do not show weaknesses in Government run health care payment systems, to the contrary, they show how allowing profits to stay in health care payment is a Bad Idea.
2
Unless you insist on only seeing "the good" - cherry picked for the millionth iteration of the same basic argument
Talk about projection!!
Talk about projection!!
1
Global banks that operate like casinos, real estate speculation, endless wars, building tanks but not bridges, government campaigns funded by billionaires,etc, causes the market place to perform more like a roller-coaster than a tranquil sea that allows all boats to rise with increased business activity.
8
As a psychologist, who studied under a Nobel Laureate economist who in turn had studied under five Nobel Laureates in economics, I learned long ago that even they, the epitome of Very Serious People, are reluctant to give up precious theories even though my mentor, Herbert Simon, found their award-winning theories had no validity in dealing with the real-world problems they claimed to solve. So, it's clearly a psychological, not economic, problem and there it's been known for decades that any "cognitive dissonance" created between economic and other predictions and reality is often solved by further efforts to victim blame and recruit supporters rather than saying the obvious, "I was wrong." The only way forward is to vote those "true believers" out, but so far the Brits have been snookered into blaming the other like Ireland, Greece and the rest of the European Union rather than their failed leaders.
6
Or, Professor Krugman, as a writer friend put it so succinctly to me years ago, "Crazy wins every time." I asked what she meant and she said you can't argue rational arguments and facts with a crazy person.
She was right.
She was right.
14
"And the ultimate example of a seriously bad idea is the determination, in the teeth of all the evidence, to declare government spending that helps the less fortunate a crucial cause of our economic problems. In the United States, I’m happy to say, this idea seems to be on the ropes, at least for now." --- Krugman
But not if the Republicans win the Presidency and continue to control Congress in 2016. Austerity for the masses will be promoted with a vengeance by the 0.1 percent who call the shots, who will also get huge tax breaks for themselves and no restrictions on their ability to pollute and to offshore jobs. We'll be told that we can't afford Social Security, Medicare, Medicaid, SNAP, etc., but Big Ag, Big Pharma, Big Oil, and the military-industrial complex will get everything that they want.
The U.S. needs a Bernie Sanders, who tells it like it is, but we're likely to wind up with another Bush who will push the usual Republican agenda of government of, by, and for the corporate rich.
But not if the Republicans win the Presidency and continue to control Congress in 2016. Austerity for the masses will be promoted with a vengeance by the 0.1 percent who call the shots, who will also get huge tax breaks for themselves and no restrictions on their ability to pollute and to offshore jobs. We'll be told that we can't afford Social Security, Medicare, Medicaid, SNAP, etc., but Big Ag, Big Pharma, Big Oil, and the military-industrial complex will get everything that they want.
The U.S. needs a Bernie Sanders, who tells it like it is, but we're likely to wind up with another Bush who will push the usual Republican agenda of government of, by, and for the corporate rich.
16
The next president won't be a Bush but may very well be a Clinton. Let's hope so, given the horrible alternatives. That said, in a perfect world, Bernie Sanders and Elizabeth Warren could fix a lot of what's wrong with this country very quickly, assuming an obstructionist and belligerent republican congress didn't get in the way.
1
So Osborne is implementing failed ideas as policy, and is able to do so because of the relentless propaganda promoted by Tory officials, conservative policy officials and--get ready--THE MEDIA! Which Professor Krugman works for (in part), and which also gave us Whitewater, George W. Bush, the Iraq War, etc.
Okay, we get it. I get it. I get that Britain's austerity policies, like the ones here (to a different degree) have had and will have serious negative effects on the vast majority of Britons. But don't just call out George Osborne, the right, etc. Call out the press. The media. The people who help "catapult the propaganda," as George W. Bush put it.
The media aren't helping us--the majority of us--one bit, and are actually doing a great deal of harm. And I don't just mean Fox News.
Okay, we get it. I get it. I get that Britain's austerity policies, like the ones here (to a different degree) have had and will have serious negative effects on the vast majority of Britons. But don't just call out George Osborne, the right, etc. Call out the press. The media. The people who help "catapult the propaganda," as George W. Bush put it.
The media aren't helping us--the majority of us--one bit, and are actually doing a great deal of harm. And I don't just mean Fox News.
4
The wealthy enter politics for only one reason: to defend their privileges. Programs they don't see as beneficial to themselves are deemed to be a waste of money. This attitude was perhaps best encapsulated by the 1st Duke of Wellington, when he lamented that the coming of the railroads would "only encourage the common people to move about needlessly."
8
CURE A SUCCESS, PATIENT KILLED In the 18th century because of seriously bad ideas, totally unsupported by any sort of empirical evidence, were much in vogue. One involved administering arsenic to "cure" diseases. Bleeding was also a prevalent "cure." We now know that both likely caused a fair number of deaths, as people so treated died of arsenic poisoning and/or loss of blood. Arsenic poisoning occurs in parts of India in which people drink water that contaminated by it, killing significant numbers of people. One of the primary causes of battlefield death is loss of blood. These are two examples of empirically based evidence. So the notion that Britain's economy will be cured by massive doses of arsenic and massive bleeding will not cure it; it will kill it. For "arsenic" and "bleeding" substitute the "austerity" measures proposed by the newly elected so-called "conservative" government. The definition of the term conservative means respect for established practices and institutions. So the radical actions of a government that disregards successful, well-established practices, thereby instituting lethal policies are in no way conservative! Rather, they are extremist, ignorant and willfully destructive, given the massive evidence that they will destroy the country. In such a case, the treatment is far worse than the illness. The surgery may be said to succeed, but the patient will have died. Or rather, will have been murdered with malice aforethought.
13
How cab anybody believe that the USA can continue to implement the Greek Government economic policies of borrowing and spending great sums of money and then expect a different result?
2
Is this a serious comment? Or copied and pasted from the comment boards at FoxNews?
The U.S. has its own currency, the U.S. is not being pressured by creditors, the U.S. unemployment rate is 5.4% while the Greek rate is 25.4%.
But, of course, the U.S. has a President you don't like. Maybe Bush will return, and with him the 7.3% unemployment rate and the fiscal crisis that put the US and the world in recession.
The U.S. has its own currency, the U.S. is not being pressured by creditors, the U.S. unemployment rate is 5.4% while the Greek rate is 25.4%.
But, of course, the U.S. has a President you don't like. Maybe Bush will return, and with him the 7.3% unemployment rate and the fiscal crisis that put the US and the world in recession.
18
Answer: Economic growth will balance extra debt. Next question!
4
Well, maybe it's because the U.S. controls its own currency whereas the Greeks do not. That obvious fact does not justify unlimited borrowing at all times, but it certainly provides a reason for different outcomes in Greece and the U.S.
Your comment shows that you don't understand some important aspects of how national economies work, as compared to, for example, household economies. In this you have a lot of company, including a large majority of the Republican Party. It's too bad we all have to pay the price (a mediocre economy) because people like you don't get it.
Your comment shows that you don't understand some important aspects of how national economies work, as compared to, for example, household economies. In this you have a lot of company, including a large majority of the Republican Party. It's too bad we all have to pay the price (a mediocre economy) because people like you don't get it.
7
If Dr. Krugman wants to point out the 'Seriously Bad Ideas' out there, what about the seriously bad ideas that people of his own political stripe keep telling the public through the agency of a media, that by the way, seems to try to keep the rose-tinted glasses on all our faces.
One of those says: "In fact, interest rates adjusted for inflation are negative, even on very long-term borrowing. Investors, in other words, are willing to pay the British government to make use of part of their wealth.'
to quote Dr. Krugman himself.
It is implying the low interest rates, which have gone on here in the U.S. at least since Alan Greenspan was Federal Reserve chairman ... are a sustainable kind on panacea for our economy's woes.
Without those low interest rates, think how high the interest to be owed on the National Debt (over $17 TRILLION), would come to. How can the U.S. afford to pay out to the "47%" so much money to support an economy in which there is effectively, high double-digit unemployment, plus an inordinate amount of inflation which they try to claim is low by not including food and energy costs, and other finagling? And how can rents keep rising as they do, if this inflation is already not too high? Meanwhile they have to cut food stamps on the poor, who can't even afford to buy groceries!
One of those says: "In fact, interest rates adjusted for inflation are negative, even on very long-term borrowing. Investors, in other words, are willing to pay the British government to make use of part of their wealth.'
to quote Dr. Krugman himself.
It is implying the low interest rates, which have gone on here in the U.S. at least since Alan Greenspan was Federal Reserve chairman ... are a sustainable kind on panacea for our economy's woes.
Without those low interest rates, think how high the interest to be owed on the National Debt (over $17 TRILLION), would come to. How can the U.S. afford to pay out to the "47%" so much money to support an economy in which there is effectively, high double-digit unemployment, plus an inordinate amount of inflation which they try to claim is low by not including food and energy costs, and other finagling? And how can rents keep rising as they do, if this inflation is already not too high? Meanwhile they have to cut food stamps on the poor, who can't even afford to buy groceries!
1
Despite your exclamation points, a) for "they," read "Republicans," and b) Republicans cut food stamps for reasons that not only had zip to do with not having the money, but which actively co tradicted sensible economics.
That was a political,mideological and even religious demand that had NOTHING to do with this country's finances.
That was a political,mideological and even religious demand that had NOTHING to do with this country's finances.
1
Whether Osborne really believes the nonsense he promotes is an interesting question. That pursuing such nonsensical policies also promotes his class interests is also, umm, interesting. But Osborne and Tory re-distributive economic policies (re-distributive upwards, of course) won't be defeated by rational argument, although it is necessary to make such argument. Seriously Bad Ideas will only be defeated by Seriously Bad Consequences. So, if Osbornean austerity leads again, as it did earlier, to recession or worse, he and the Tories are dead ducks. Voters will know that after years of Tory rule, you can't continue to blame Gordon Brown. Labour's recovery depends heavily upon the Tories messing up badly. The opportunities to mess up badly are so numerous that it is good bet that they will.
7
The professor is obviously still smarting from his utterly failed prediction that the (very mild) austerity program in the UK would turn it into a financial basket-case and as a result of which Tories would be swept out of power.
(Just another episode in that long running and highly entertaining saga: Liberal v. Reality.)
(Just another episode in that long running and highly entertaining saga: Liberal v. Reality.)
6
I believe that reading Prof. Krugman's columns you would realize that things have turned out more or less exactly as he predicted.
(Just another episode in that long running and not very entertaining saga: Ideology over information)
(Just another episode in that long running and not very entertaining saga: Ideology over information)
2
You meant to say facts versus reality, right?
No doubt you'll be easily able to point to the exact numbers showing that England's doing just peachey in terms of her economics.
For example, what's with the big productivity drop?
For example, what's with the big productivity drop?
1
Seems that Kansas is giving up on its 'Seriously Bad Ideas' of tax cuts for the wealthy and well off citizens, finally. Of course the desperate plea of slashing all educational institutions had the effect of voting for the increase of cigarette tax, 50 cents, and the retrograde sales tax hike of half a percent. Naturally this burden falls on those least able to afford it. So another 'Seriously Bad Idea' was replaced with another one.
So at least we can finally say that the Kansas "Experiment" has failed and will continue to do so. This won't be the last tax hike needed for Kansas to recover from Gov. Brownback and his Koch backed republican minion's malfeasance. But the end of voter stupidity may not end anytime soon. After all the Governor and the Tea Party legislators were just reelected. Good luck with the next couple of election cycles Kansans. The nation's eyes will be on you.
So at least we can finally say that the Kansas "Experiment" has failed and will continue to do so. This won't be the last tax hike needed for Kansas to recover from Gov. Brownback and his Koch backed republican minion's malfeasance. But the end of voter stupidity may not end anytime soon. After all the Governor and the Tea Party legislators were just reelected. Good luck with the next couple of election cycles Kansans. The nation's eyes will be on you.
10
If the Republicans had been successful in inducing a much deeper and longer recession here in the States, it would have been great news for them and good news for their mega-rich clients. Those who would have suffered most would have been Republican supporters in the less economically robust states, like the south.
Not every argument should be turned into one of partisan politics. Yet, if we look at what our new parties endeavor to do in naked terms, their arguments and counter arguments can be reduced representing economic interest sections. The Democrats want to help, or appear to help, those in the lower 2/3s of the economy while generally preserving the status quo. The Republicans represent the interests of those in the upper 1/3, especially the upper-upper portion, while pretending to care about the "family values" and religiously motivated concerns of those against social change. The Republicans want to preserve the part of the status quo that benefits their clients and expand all the advantages and privileges of wealth. That's it, in a nutshell.
Every problem that America has now was caused by stupid liberal attempts to make a better, more broadly successful society and provide help to those without means. You didn't know that? This is essentially the line the Republicans are selling and a greater recession would have made the sales job far more convincing. We mirror England, but our national wealth allowed us to escape before the door was slammed on recovery.
7
Does Paul Krugman not understand that borrowing rates are based on lenders beliefs about the future spending habits? Citing low interest rates for countries committed to austerity as a reason they can afford to spend is disingenuous.
Perhaps this is his own Seriously Bad Idea?
Perhaps this is his own Seriously Bad Idea?
5
"beliefs," huh? So much for numbers.
3
It is not just the fact there are 'Seriously Bad Ideas'; it is the fact there are enough people with influence or power, to base their policies and decisions on these 'Seriously Bad Ideas'.
Before there were government budget deficits of such magnitude as today, there weren't many times when such deficits were run up, like when there were major wars, including under G.W. Bush Only after institution of welfare policies, 'universal health care', ..., have we had such high levels of debt.
So what is Dr. Krugman talking about when he claims debt levels are not so high by historical standards?
He seems to be saying there were important periods in history with levels of debt as high as now in Britain, the U.S. ..., and that the effects were not so detrimental, and/or, the effects were kept controlled so the economy would not be so adversely affected. If in fact those effects were mitigated before, is itself to acknowledge that it isn't so good to have such levels of debt, EVEN IF not high by 'historical standards'.
And that means something is needed to counteract those not-so-good effects. Dr. Krugman should then acknowledge this, and explicitly say it's things like the low interest rates, that are allaying harmful effects so far.
When will we understand how things done to counteract those possible ill effects, can outlast their proper duration to be used. Then what?
What if anything, can replace them so as to keep the deficit spending from causing dire harm?
Before there were government budget deficits of such magnitude as today, there weren't many times when such deficits were run up, like when there were major wars, including under G.W. Bush Only after institution of welfare policies, 'universal health care', ..., have we had such high levels of debt.
So what is Dr. Krugman talking about when he claims debt levels are not so high by historical standards?
He seems to be saying there were important periods in history with levels of debt as high as now in Britain, the U.S. ..., and that the effects were not so detrimental, and/or, the effects were kept controlled so the economy would not be so adversely affected. If in fact those effects were mitigated before, is itself to acknowledge that it isn't so good to have such levels of debt, EVEN IF not high by 'historical standards'.
And that means something is needed to counteract those not-so-good effects. Dr. Krugman should then acknowledge this, and explicitly say it's things like the low interest rates, that are allaying harmful effects so far.
When will we understand how things done to counteract those possible ill effects, can outlast their proper duration to be used. Then what?
What if anything, can replace them so as to keep the deficit spending from causing dire harm?
2
One SBI is that government of, by and especially FOR the people is itself a SBI. Much better to have government by the nobles--the wealthy--for the nobles--with perks, like tips, for the people.
Of course they market this Neo-aristocracy as Democracy--defining "democracy" as freedom from government regulation of business; money is marketed as "votes" for economic candidates running for office.
Another SBI is that THE ECONOMY is a reality unto itself--with laws of its own, much like physics and laws of nature. But THE ECONOMY is about ownership and property--and these are networks of political/legal rights and duties--and their enforcement. Without the politics property (rights/duties) disappears and with it THE ECONOMY.
JS Mill never abstracted THE ECONOMY from politics, writing instead about "Political Economy" contrasted with "Home Economics"--an etymological pleonism, since "oikos-nomos" meant rules and regulations of (private) home management. This often supposed to be like Darwin's division between "Domestic" (breeding arts) vs "Natural Selection".
But nature functions without politics; economies do not. Indeed the study of them was once classified as a "moral science."
Rules and regulations of (public) business management are not separate and independent of political reality--that is a Very SBI--with all the trappings and mystique of Theology--the original SBI.
Of course they market this Neo-aristocracy as Democracy--defining "democracy" as freedom from government regulation of business; money is marketed as "votes" for economic candidates running for office.
Another SBI is that THE ECONOMY is a reality unto itself--with laws of its own, much like physics and laws of nature. But THE ECONOMY is about ownership and property--and these are networks of political/legal rights and duties--and their enforcement. Without the politics property (rights/duties) disappears and with it THE ECONOMY.
JS Mill never abstracted THE ECONOMY from politics, writing instead about "Political Economy" contrasted with "Home Economics"--an etymological pleonism, since "oikos-nomos" meant rules and regulations of (private) home management. This often supposed to be like Darwin's division between "Domestic" (breeding arts) vs "Natural Selection".
But nature functions without politics; economies do not. Indeed the study of them was once classified as a "moral science."
Rules and regulations of (public) business management are not separate and independent of political reality--that is a Very SBI--with all the trappings and mystique of Theology--the original SBI.
4
I don't know about British politicians, but it's abundantly clear that Republicans here use deficits as an excuse to cut social programs, as well as other things they don't like such as public universities and natural resource agencies. And if there is no deficit? They'll happily create one with tax cuts that somehow always seem to go mostly to corporations and the wealthy.
7
Governments that spend more than a nation’s Government collects in taxes adds to each nation’s national debt, and this will eventually destroy that nation’s economy and then cause that nation to evolve into something resembling Greece, then Mexico, and then Somalia when individuals and governments in the industrialized wealth-creating BRIC nations stop lending the USA money to pay for our wealth consuming and wealth destroying government activities that are in excess of their tax collections!
Each nation in the entire world risks the destruction of their economy and their nation if their nation’s businesses stop creating sufficient new taxable wealth (profits/money) so that a part of that taxable wealth is then available to be confiscated as taxes to pay for their wealth consuming government activities.
Some nations like the USA and Greece just de-industrialized and then started living off borrowed money using the wealth created by previous generations as collateral for loans to pay for their wealth consuming government activities.
Each nation in the entire world risks the destruction of their economy and their nation if their nation’s businesses stop creating sufficient new taxable wealth (profits/money) so that a part of that taxable wealth is then available to be confiscated as taxes to pay for their wealth consuming government activities.
Some nations like the USA and Greece just de-industrialized and then started living off borrowed money using the wealth created by previous generations as collateral for loans to pay for their wealth consuming government activities.
2
If Very Serious Politicians don't stop with the: "you pay your bills...like everybody else... at the kitchen table" then we've had it. ("vote for me and I'll set you free" Temptations, 1971). Actually, me and the wife do our globalized supply and demand copper-futures-based credit default swaps... at the kitchen table!
1
Professor Krugman, plus most of the other modern “popular” economists, usually believe the US government should imitate Greece and continue to borrow a lot of US Dollars back from individuals in the recently industrialized wealth creating BRIC nations and then spend that money on more US wealth consuming and wealth destroying US federal government activities to stimulate the economy that do not provide any return on investment or create any new taxable wealth.
These wealth consuming/destroying government activities include government contracts, pork barrel infrastructure contracts, more US government employees, more US infrastructure improvements, more entitlements, and more of other similar US government activities to gain the popularity and the votes of the citizens.
These government actions will only increase the national debt.
Spending more than a nation collects in taxes adds to each nation’s National Debt and this will destroy their economies and then cause these nations to evolve into something resembling Detroit, then Greece, then Mexico, and then Somalia when individuals and governments in the industrialized wealth creating BRIC nations finally stop lending back the USA and other wealth consuming nations their hard earned US Dollars (by buying freshly printed paper US Treasury Bonds) to pay for US government wealth consuming activities that are in excess of our tax collections!
These wealth consuming/destroying government activities include government contracts, pork barrel infrastructure contracts, more US government employees, more US infrastructure improvements, more entitlements, and more of other similar US government activities to gain the popularity and the votes of the citizens.
These government actions will only increase the national debt.
Spending more than a nation collects in taxes adds to each nation’s National Debt and this will destroy their economies and then cause these nations to evolve into something resembling Detroit, then Greece, then Mexico, and then Somalia when individuals and governments in the industrialized wealth creating BRIC nations finally stop lending back the USA and other wealth consuming nations their hard earned US Dollars (by buying freshly printed paper US Treasury Bonds) to pay for US government wealth consuming activities that are in excess of our tax collections!
2
Gerald--to repeat: Economic growth balances the debt. The only times this failed were under Dubya and Raygun. Bill Clinton saved the US. Bush I tried by raising taxes and causing a recession.
2
toom,
How well did that work for the Greek nation?
How well did that work for the Greek nation?
1
In short, public spending pays for everything the dominant plutocratic class doesn't want anyone else to have.
England should reject austerity and continue to implement the Greek government economic plan where very few of the Greek People are industrial workers creating new taxable wealth in the Greek Nation.
The majority of the Greek People are wealth consumers, living directly or indirectly off of Greek government payments or Greek contracts, and these people do not create any new Taxable Wealth in the Greek nation!
Maybe Greece should become industrialized and make widgets, then Greek businesses could make and then sell enough widgets to others outside of Greece so that Greece can accumulate enough privately held profit and taxable wealth to enable the Greeks to buy the other things that Greece needs from other nations that produce those other things (food, shelter, clothing, etc.) that the Greek people consume and pay for Greek Government activities.
Then hopefully Greece will then have created enough taxable wealth to have some available for government confiscation to pay for Greek current government activities and future Greek government emergencies without the Greek government borrowing any more money.
Greek citizens working for their Greek government on Greek Government payrolls only consume Greek Government economic capability; no matter how hard they work or how many hours they work per year.
Greek Government contracts awarded to their Greek Citizens also only consume Greek Government economic capabilities.
The majority of the Greek People are wealth consumers, living directly or indirectly off of Greek government payments or Greek contracts, and these people do not create any new Taxable Wealth in the Greek nation!
Maybe Greece should become industrialized and make widgets, then Greek businesses could make and then sell enough widgets to others outside of Greece so that Greece can accumulate enough privately held profit and taxable wealth to enable the Greeks to buy the other things that Greece needs from other nations that produce those other things (food, shelter, clothing, etc.) that the Greek people consume and pay for Greek Government activities.
Then hopefully Greece will then have created enough taxable wealth to have some available for government confiscation to pay for Greek current government activities and future Greek government emergencies without the Greek government borrowing any more money.
Greek citizens working for their Greek government on Greek Government payrolls only consume Greek Government economic capability; no matter how hard they work or how many hours they work per year.
Greek Government contracts awarded to their Greek Citizens also only consume Greek Government economic capabilities.
3
You get too many entries it seems as you know nothing about macroeconomics. Greece has no currency of its own and is mired in depression. It is not an exporting nation. It cannot raise itself by its bootstraps; if you have a plan send it there now. Remember what really ended the US Depression was the massive deficit spending of the WWII. Hoover's tax increases in 1930-32 and FDR's in '37 made it worse. The US had very few balanced budgets after WWII thru the 1990's so you need to realize that they are not a panacea. Cool it on the National Debt; it's not a bogeyman for a Monetarily Sovereign nation.
1
The British election was not about the economy it was about everything but the economy. It was about the same issues that divide that political union as divide our own politics.
The difference being British Conservatives believe in democracy and American conservatives trust the not so invisible hand.
While British Conservatives chose the radical choice of rolling the dice and Labour chose the much more conservative change only if necessary policies. The people of Britain chose to be Scots, English, Welsh and maybe Ulstermen over British. They chose a path that may see them out of the European and global economy but the ballot box will decide the political makeup of the new political entities and their reliance on more heterogeneity economic coalitions. For the peoples of what is now Great Britain putting the cart before the horse meant identity before economics.
In the USA we pretend that we are voting on policy but we are voting identity. We are not even given the ability to vote for a the primacy of identity. Political parties are a collection of identities and Americans vote their regional, cultural, religious and sexual identities even as the economic powers that be make us believe that we are all in the same boat.
As the industries moved to "right to work states" we were made to believe it was all the fault of the unions.Now greed is the reason we are suffering as we are too expensive.
We need to vote whether Washington can serve the Texas oilmen and we the people.
The difference being British Conservatives believe in democracy and American conservatives trust the not so invisible hand.
While British Conservatives chose the radical choice of rolling the dice and Labour chose the much more conservative change only if necessary policies. The people of Britain chose to be Scots, English, Welsh and maybe Ulstermen over British. They chose a path that may see them out of the European and global economy but the ballot box will decide the political makeup of the new political entities and their reliance on more heterogeneity economic coalitions. For the peoples of what is now Great Britain putting the cart before the horse meant identity before economics.
In the USA we pretend that we are voting on policy but we are voting identity. We are not even given the ability to vote for a the primacy of identity. Political parties are a collection of identities and Americans vote their regional, cultural, religious and sexual identities even as the economic powers that be make us believe that we are all in the same boat.
As the industries moved to "right to work states" we were made to believe it was all the fault of the unions.Now greed is the reason we are suffering as we are too expensive.
We need to vote whether Washington can serve the Texas oilmen and we the people.
2
The subtext, never spoken of, is that all those poor people would be better off dead.
Shocked? Think again. Looting as policy is shameful, but history shows that hubris builds on itself.
Shocked? Think again. Looting as policy is shameful, but history shows that hubris builds on itself.
6
Prof. Krugman states that Very Serious People declare that "government spending that helps the less fortunate (is) a crucial cause of our economic problems. In the United States, I’m happy to say, this idea seems to be on the ropes, at least for now."
Sorry to inform Prof. Krugman, but it's alive and well here in Michigan - fast becoming the Mississippi of the North (although Mississippi has significantly higher rates of childhood immunizations than Michigan).
Michigan has given away billions of dollars in tax credits to corporations at the same time taxing retiree pensions for the very first time and eliminating/cutting tax credits to low income families.
Our roads and bridges are a complete shambles; yet, the legislature refuses to lower truck weight limits that are double the highest in the rest of the country at 160,000 pounds. The legislature refuses to establish any long term funding formula for road construction/maintenance because taxes would have to be increased on business and on higher incomes to cover that cost.
Education funding has been slashed by the republicans to the point that more than 50 school districts are now in deficit spending with emergency managers being appointed willy nilly to certain districts (all inner city, minority dominated). Detroit has now had a multitude of emergency managers - all, so far, unsuccessful.
The list goes on and on. No wonder two of my sons (computer engineers) live on the west coast.
Pure Michigan!!!
Sorry to inform Prof. Krugman, but it's alive and well here in Michigan - fast becoming the Mississippi of the North (although Mississippi has significantly higher rates of childhood immunizations than Michigan).
Michigan has given away billions of dollars in tax credits to corporations at the same time taxing retiree pensions for the very first time and eliminating/cutting tax credits to low income families.
Our roads and bridges are a complete shambles; yet, the legislature refuses to lower truck weight limits that are double the highest in the rest of the country at 160,000 pounds. The legislature refuses to establish any long term funding formula for road construction/maintenance because taxes would have to be increased on business and on higher incomes to cover that cost.
Education funding has been slashed by the republicans to the point that more than 50 school districts are now in deficit spending with emergency managers being appointed willy nilly to certain districts (all inner city, minority dominated). Detroit has now had a multitude of emergency managers - all, so far, unsuccessful.
The list goes on and on. No wonder two of my sons (computer engineers) live on the west coast.
Pure Michigan!!!
3
What continues to amaze is how The Doc can talk out of both sides of his mouth.. in the same column. On the one hand he bemoans the opinion, purportedly reported as fact in Britain, that it was Labour's spending proclivities that brought about the pain of The Great Recession in the U.K. Opinions can certainly vary on such a question but fair enough - such a position is, indeed, an opinion.
Fast forward a whopping four paragraphs and what we then get is "surely the combination of a still-weak economy, terrible productivity performance and negative borrowing costs says that this is a time to increase investment in things like infrastructure." Such a statement delivers the epitome of Keynesian doctrine and, dependably as ever, it is delivered as a statement of fact (note the word 'surely') rather than opinion.
It seems that Very Serious People from all sides of the economic policy spectrum suffer from the same opinion-as-fact delusion.
Fast forward a whopping four paragraphs and what we then get is "surely the combination of a still-weak economy, terrible productivity performance and negative borrowing costs says that this is a time to increase investment in things like infrastructure." Such a statement delivers the epitome of Keynesian doctrine and, dependably as ever, it is delivered as a statement of fact (note the word 'surely') rather than opinion.
It seems that Very Serious People from all sides of the economic policy spectrum suffer from the same opinion-as-fact delusion.
2
No, the problem is that people don't recognize evidence - there is plenty of it implicating lax financial regulation/enforcement from public and private watchdogs - and in not doing so, opinion and fact are equalized. People also don't understand that government spending/investment IS part of GDP - generally, reducing government spending during a recession further decreases employment (of government employees and in the private sector), GDP, demand, making the recession worse. That's not an opinion, that's just arithmetic. To some degree, increased spending during a recession is built in - with no change in policy, spending on unemployment and related benefits increases in every recession; this is typically complemented by additional increased spending (Reagan, Bush jr.) and tax cuts (increases deficits/debt). Finally, details matter, e.g., what kind of recession, how deep, what the causes were, and where money is spent or not spent.
9
It is a matter of opinion, but to me "surely" is a word used to convince someone of an opinion, never used to preface a fact.
We have to admit that sometimes good ideas can be unpopular. In Britain's case, and to some extent the US' too, Conservative ideas such as Mr. Osborne's resonate well with the public since it champions fiscal discipline, a concept that is not only highly regarded by average households but also easy to understand as it relates to expenditure and income with a simple mathematical relationship between them. In contrast, left-ish ideas such as the one of Prof. Krugman is much harder to comprehend let alone relate to the average public voter. It champions monetary and financial discipline, concepts that are hard to follow as they relate to investment decisions and to money allocation across outlays with higher multipliers. This is more complicated mathematical exercise to wrap someone's head around. It leads the average voters to shelter in self-denial rather than confronting their egos that are harmed by their inability to comprehend complex problems or their lack of willingness to go through this demanding exercise. Good ideas result from thought investment. Look around you every where, investment in thoughts is declining and to some extent is frowned upon. What is popular now is superficiality and thought investment commensurate with thinkers like Joe the Plumber and Sarah Palin. The world has become a glorious amphitheater where crowds applaud cheerfully for the millennium most anticipated race to the bottom.
2
David Brook's column today is about maturing into adulthood. When all the pretty things of childhood finally fade away into the reality of adulthood. To my father that happened in his teens (he would be 100), to me it happened in my twenties. It may never happen for some of our children and grandchildren.
The same with the failed policies of the republicans and austerity mavens; maybe they will grow up and see their childish plaything (supply side econ) as a toy to be discarded with childhood or maybe not.
So far the abject failure these last 35 years of their fantasy world hasn't moved them to reconsider their dogma of corporate capitalism. It might take a total breakdown, similar to what we are seeing in Syria and elsewhere, for us to take our country back from the oligarchs who have steadily eroded the democracy that we have been taking for granted.
The same with the failed policies of the republicans and austerity mavens; maybe they will grow up and see their childish plaything (supply side econ) as a toy to be discarded with childhood or maybe not.
So far the abject failure these last 35 years of their fantasy world hasn't moved them to reconsider their dogma of corporate capitalism. It might take a total breakdown, similar to what we are seeing in Syria and elsewhere, for us to take our country back from the oligarchs who have steadily eroded the democracy that we have been taking for granted.
1
I recall a college-mate once saying, in jest I hope, "mere facts will never sway me." I cannot translate this into Latin, but if I could, it would certainly make a great slogan for conservative movements worldwide.
6
As long as the rich and powerful are not hurt by the decisions the British Government make, they are not going to care. It's kind of like looking out as window from the tenth floor and see the beautiful architecture and clear blue skies. If you look at street level you see the pollution, the street urchins, the fear and defeatism in the peoples' eyes. It's your view and the politicans are helping the rich loot society.
2
Still missing from Krugman's voice: recognition that his own political team is a good deal responsible for giving not only the Very Serious People credence, but sympathy for their SBI's.
Can't beat something with nothing. And you certainly can't beat something that you give aid and comfort to if, in fact, you're really trying to beat it.
So Obama will get TPP fast track. Seriously bad idea from a Seriously Bad Democrat.
Can't beat something with nothing. And you certainly can't beat something that you give aid and comfort to if, in fact, you're really trying to beat it.
So Obama will get TPP fast track. Seriously bad idea from a Seriously Bad Democrat.
3
Confirmation Bias is a human trait involving selecting information that supports one's beliefs and rejecting information that contradicts it.
Scientists, liberals, and progressives are all effected by confirmation bias, but Republicans are by far the most effected.
Vested interests allocate significant resources to creating information that supports right wing beliefs. 'Merchants of Doubt' documents how some of the same people who provided doubt about scientific evidence linking tobacco to cancer are now providing evidence against climate change.
Some elements of the financial industry put much effort into diverting blame in order to reduce regulation. Regulation is very difficult for the major global financial institutions, largely because of dis-economies of scale. It is very difficult for global banks to comply with regulations in 50-80 countries that effect many different operations.
The banks don't want to admit this because the obvious solution would be to split up the too-large-to-fail banks. But they will eventually understand that the individual lines of business would be more profitable if not part of the larger corporate entity, and the will move to divest on their own.
Blaming public spending fits the Republican narrative much better than blaming loose regulation.
Allocating more resources to infrastructure is necessary. We should not be discussing whether we allocate more public money, but how to choose the best investments.
Scientists, liberals, and progressives are all effected by confirmation bias, but Republicans are by far the most effected.
Vested interests allocate significant resources to creating information that supports right wing beliefs. 'Merchants of Doubt' documents how some of the same people who provided doubt about scientific evidence linking tobacco to cancer are now providing evidence against climate change.
Some elements of the financial industry put much effort into diverting blame in order to reduce regulation. Regulation is very difficult for the major global financial institutions, largely because of dis-economies of scale. It is very difficult for global banks to comply with regulations in 50-80 countries that effect many different operations.
The banks don't want to admit this because the obvious solution would be to split up the too-large-to-fail banks. But they will eventually understand that the individual lines of business would be more profitable if not part of the larger corporate entity, and the will move to divest on their own.
Blaming public spending fits the Republican narrative much better than blaming loose regulation.
Allocating more resources to infrastructure is necessary. We should not be discussing whether we allocate more public money, but how to choose the best investments.
1
Bad ideas have a life of their own.
Remember Rick Santelli, purportedly the father of the Tea Party, asking if we wanted to pay our neighbor's mortgage on a house that was far more grandiose than ours? The answer, of course, was no but the question effectively diverted attention from the financial engineering that made our neighbor's mortgage possible and spawn a bad idea.
How many people understand derivatives? Few. Santelli's question, I would argue, blunted the attention people should have paid to deregulation, Wall Street, mortgage brokers, ratings companies and insurance companies and focused it on the guy at the end of the food chain who signed the "liars loan."
The resulting bad idea was the Tea Party
Remember Rick Santelli, purportedly the father of the Tea Party, asking if we wanted to pay our neighbor's mortgage on a house that was far more grandiose than ours? The answer, of course, was no but the question effectively diverted attention from the financial engineering that made our neighbor's mortgage possible and spawn a bad idea.
How many people understand derivatives? Few. Santelli's question, I would argue, blunted the attention people should have paid to deregulation, Wall Street, mortgage brokers, ratings companies and insurance companies and focused it on the guy at the end of the food chain who signed the "liars loan."
The resulting bad idea was the Tea Party
3
The Greek nation is a good example of not living within your income (taxes collected). If the Greek government had implemented austerity many years ago, then the Greek government would have money to pat for its obligations!
But the Greek Government wants now to borrow even more money to spend on more and more wealth consuming (wealth destroying) government activities!
More of the Greek citizens have to stop living off of the Greek government if the Greek government is to have any future.
What percentage of the Greek citizens can live off of the taxes that the Greek citizens pay to the Greek government?
What percentage of the Greek GDP is wealth consuming Greek government activity?
But the Greek Government wants now to borrow even more money to spend on more and more wealth consuming (wealth destroying) government activities!
More of the Greek citizens have to stop living off of the Greek government if the Greek government is to have any future.
What percentage of the Greek citizens can live off of the taxes that the Greek citizens pay to the Greek government?
What percentage of the Greek GDP is wealth consuming Greek government activity?
3
First, Greece is an outlier - its not a useful comparator for the U.K. or the U.S.
Second, you completely misunderstand Greece's problem but you also unintentionally make a point that most miss and it is this: in order to cut government, a country has to have a strong economy and private sector to pick up the slack of cutting government - see, government DOES account for some employment and demand (government employees, private contractors, suppliers), and when cutting government, it helps a lot if employment is already quite high and there is a vibrant private sector to pick up the slack in cutting government demand. But that was/is Greece's problem - too small a formal private sector to compensate for austerity, to pay back the loans, or to sustain itself. There is also the problem of Greece having the Euro which it can't devalue in its current situation, as Krugman mentions.
We've been here before, most notably in my memory during the 1980s debt crisis when developing countries were unable to repay loans because their economies could not sustain it; after years of refusing to recognize loans as defaulted on, oscillating between being tough and providing breathing room, the developed world focused on helping these countries develop and forgave most of the debt, but we seem to have little memory of that. Another example was post-WWI Europe, with unrealistic demands being made on Germany to pay reparations, amounts too large for its economy to sustain.
Second, you completely misunderstand Greece's problem but you also unintentionally make a point that most miss and it is this: in order to cut government, a country has to have a strong economy and private sector to pick up the slack of cutting government - see, government DOES account for some employment and demand (government employees, private contractors, suppliers), and when cutting government, it helps a lot if employment is already quite high and there is a vibrant private sector to pick up the slack in cutting government demand. But that was/is Greece's problem - too small a formal private sector to compensate for austerity, to pay back the loans, or to sustain itself. There is also the problem of Greece having the Euro which it can't devalue in its current situation, as Krugman mentions.
We've been here before, most notably in my memory during the 1980s debt crisis when developing countries were unable to repay loans because their economies could not sustain it; after years of refusing to recognize loans as defaulted on, oscillating between being tough and providing breathing room, the developed world focused on helping these countries develop and forgave most of the debt, but we seem to have little memory of that. Another example was post-WWI Europe, with unrealistic demands being made on Germany to pay reparations, amounts too large for its economy to sustain.
Gerald: I'm slipping. I had to look to see where you lived. I should have known you were from Texas!
Speaking from this side of the pond, I think it's important for you to realise what a conservative country England is, although please note that I don't include Scotland here. It pains me to say it, but it is clear that the only way the Labour Party can hope to win is by presenting itself as Conservative-lite, something Tony Blair - no hero of mine - grasped from the start. We currently have the unedifying spectacle of those contesting the Labour Party leadership falling over themselves to suck up to the 'City', our our branch of Wall Street. Yet, neither the Conservative election victory nor Labour's fawning have prevented HSBC's announcement that it will soon withdraw its HQ from London, indicating how difficult it is to satisfy the plutocracy.
That said, elections are generally lost by the incumbent rather than won by the challenger, and I'm by no means convinced of the solidity of the current economic 'recovery': the average UK individual is still burdened with debt, and the next crash will be particularly painful without the option of cutting interest rates - stuck at rock bottom for the last six years to keep the patient alive - to cushion the blow.
That said, elections are generally lost by the incumbent rather than won by the challenger, and I'm by no means convinced of the solidity of the current economic 'recovery': the average UK individual is still burdened with debt, and the next crash will be particularly painful without the option of cutting interest rates - stuck at rock bottom for the last six years to keep the patient alive - to cushion the blow.
3
Just because a politician has no ethical qualms about telling a lie to get votes does not mean that same politician is incapable of sincerely believing something preposterous.
Conservatives, both in Britain and in the United States, seem to dedicate their lives to proving the truth of this aphorism.
Conservatives, both in Britain and in the United States, seem to dedicate their lives to proving the truth of this aphorism.
4
Paul touches on a central issue but doesn't say it: these ideas persist because voters believe them.
Gary Trudeau illustrated it in Doonesbury way back in 2003 in a Mark Slackmeyer conversation with his Conservative Partner, Chase Talbot III. Mark is thinking out loud about the inability of Progressives to convince their fellow citizens of the failure of some ideas.
Chase says to him, "You liberals are hung up on fairness! You actually try to respect all points of view! But conservatives feel no need whatsoever to consider other views. We know we’re right, so why bother? Because we have no tradition of tolerance, we’re unencumbered by doubt! So we roll you guys every time!”
Mark thinks about it for a minute and then says, “Actually, you make a good point…”,
To which Chase responds, “See! Only a loser would admit that!”
American and British Conservative leaders aren't concerned about the opposition; Conservatives leaders are predominately rich; they aren't going to suffer regardless. Their money always chases good investments.
What they don't want is their money being shared. Krugman and others can show forever that the earth goes around the sun, but they don't run the Church and they can't promise salvation; Conservatives can; they make money and promise that if others just do as Conservatives say, the voters will someday, maybe not today or tomorrow, but soon. Be better off.
And voters line up to get into that Church. Thus American Red States. Thus Osborne.
.
Gary Trudeau illustrated it in Doonesbury way back in 2003 in a Mark Slackmeyer conversation with his Conservative Partner, Chase Talbot III. Mark is thinking out loud about the inability of Progressives to convince their fellow citizens of the failure of some ideas.
Chase says to him, "You liberals are hung up on fairness! You actually try to respect all points of view! But conservatives feel no need whatsoever to consider other views. We know we’re right, so why bother? Because we have no tradition of tolerance, we’re unencumbered by doubt! So we roll you guys every time!”
Mark thinks about it for a minute and then says, “Actually, you make a good point…”,
To which Chase responds, “See! Only a loser would admit that!”
American and British Conservative leaders aren't concerned about the opposition; Conservatives leaders are predominately rich; they aren't going to suffer regardless. Their money always chases good investments.
What they don't want is their money being shared. Krugman and others can show forever that the earth goes around the sun, but they don't run the Church and they can't promise salvation; Conservatives can; they make money and promise that if others just do as Conservatives say, the voters will someday, maybe not today or tomorrow, but soon. Be better off.
And voters line up to get into that Church. Thus American Red States. Thus Osborne.
.
11
That great sage, Pogo, said it best, "we have met the enemy, and he is us."
Conservative ideas such as those Paul Krugman discusses here have been around forever. They derive from the attitude of those with the wealth and power that they should be allowed to keep all they have, and perhaps get some more. Gold-standard ideas spring from this source - i.e. it would be terrible if inflation of currency were allowed to devalue what the wealthy already possess. Keynesian economics argues that for the good of the whole national economy the government should intervene in the normal cycle of capitalist boom and bust. But that cycle is good for the wealthy as a class - the bust kills off all the competition, and allows those with cash to buy up more assets at fire-sale prices. It also starves the workers and makes them subservient. The mind-set is so deeply ingrained in the profession of economics - which exists to further the interests of the wealthy - that its pro-wealth assumptions are mistaken for Reality - the Facts of Life - from which perspective self-interest can be mistaken for science.
5
People too often suffer from this delusion that all will be right if they take away earned Social Security and turned retirement into another Wall Street gamble, if they just eliminate X number of government jobs (eliminate Federal courts, spending on transportation) while doubling defense spending with more wars.
Reality eludes them. One loud voice on the right has been Niall Ferguson, historian and writer on economics who mostly gets his facts wrong, especially when he's acting as a shill for the British right wingers.
Whe one publication is forced to acknowledge his errors, he goes to another and denies plain facts and smears those who suggests real facts are in order.
As for infrastructure, few better examples could be found of short-sighted thrift as that of Chris Christy's blocking construction of the Trans-Hudson tunnels. He damaged the economy of the Northeast region while hanging a sword of Damocles over those who rely on rail to go to their jobs on either side. It would also have provided tens of thousands of jobs for years.
Watch as tolls continue to rise on road bridges into the city and pray if you rely on one, that one of the road tunnels doesn't close. Watch I-95 on either side of the river and cross your fingers that Amtrak or successor doesn't collapse or close until repairs can be made to Century plus old bridges.
One key element today is the false economy sold by the right, here and Britain - and more.
Reality eludes them. One loud voice on the right has been Niall Ferguson, historian and writer on economics who mostly gets his facts wrong, especially when he's acting as a shill for the British right wingers.
Whe one publication is forced to acknowledge his errors, he goes to another and denies plain facts and smears those who suggests real facts are in order.
As for infrastructure, few better examples could be found of short-sighted thrift as that of Chris Christy's blocking construction of the Trans-Hudson tunnels. He damaged the economy of the Northeast region while hanging a sword of Damocles over those who rely on rail to go to their jobs on either side. It would also have provided tens of thousands of jobs for years.
Watch as tolls continue to rise on road bridges into the city and pray if you rely on one, that one of the road tunnels doesn't close. Watch I-95 on either side of the river and cross your fingers that Amtrak or successor doesn't collapse or close until repairs can be made to Century plus old bridges.
One key element today is the false economy sold by the right, here and Britain - and more.
6
I really think that the reason these ideas don't die out is that they are simple and people can understand them. We teach (at least I did) our children to live within their means, save for retirement and not to borrow too much. At the same time, it's obscure to most people that a family is not a country. Families don't have their own currencies and the members will need money in retirement because they cannot work anymore. Countries have their own currencies and there is always a new crop of workers. So, overall debt can increase effectively forever. I have seen over and over again that the Keynesian way of looking at things is simply hard for most people to understand. At the same time, every one of us has experienced poor service and outright wasted by (particularly the federal) government. That leads people to conclude that reducing government spending reduces waste. Again, the fact that this doesn't actually happen is lost on people. The school system likes to lay off teachers, they never get rid of the administrative assistants to the superintendents and make them answer their own phones. I think that the appeal of easy solutions is a siren song these days because we keep teaching our kids about the Roman Empire and we don't teach them economics, at least in part.
4
There is one thing that the rich, privileged and powerful fear the most. The working class. The people who do most of the work and earn the least are the source of their nightmares. They will do anything, say anything and justify everything that keeps workers in their place while protecting their own privilege.
Any meaningful distribution of wealth, whether in the form of a real job that pays a living wage for every worker or social benefits that ensures a decent standard of living for everyone will have to come from increased taxes on the wealthy and their treasured corporations. They have their shills in politics, the media, in academia and even in the pulpit to justify their gifted standard of living and the continued lack of one for so many others.
Why are people surprised at this?
Any meaningful distribution of wealth, whether in the form of a real job that pays a living wage for every worker or social benefits that ensures a decent standard of living for everyone will have to come from increased taxes on the wealthy and their treasured corporations. They have their shills in politics, the media, in academia and even in the pulpit to justify their gifted standard of living and the continued lack of one for so many others.
Why are people surprised at this?
4
At least in the USA you have the opportunity to start your own business, work really hard and then join the rich if you are successful, as compared to Egypt, Bahrain, Yemen, Saudi Arabia, Syria, Tunisia, and/or Libya where you have to be politically and/or family connected and/or bribe some government official to get government license to become a businessman.
Alon Ben-Meir, senior fellow, NYU's Center for Global Affairs, said, “When university graduate turned street vendor Mohamed Bouazizi set himself on fire in front of a government building in Sid Bouzid, Tunisia on 17 December 2010 he unleashed a torrent of long-repressed political expression in the Middle East. Through his brave self-immolation, he sent a clear message to his generation: die with dignity rather than continue to live and suffer the daily indignities that amount to an unfulfilled life. It is that message that empowered Egyptians, Yemenis, Libyans, Syrians and others to protest and die in the hope that their sacrifices would bring an end to their daily injustices.”
With that extraordinary act of protest by Mohamed Bouazizi, then the Arab Spring began.
Alon Ben-Meir, senior fellow, NYU's Center for Global Affairs, said, “When university graduate turned street vendor Mohamed Bouazizi set himself on fire in front of a government building in Sid Bouzid, Tunisia on 17 December 2010 he unleashed a torrent of long-repressed political expression in the Middle East. Through his brave self-immolation, he sent a clear message to his generation: die with dignity rather than continue to live and suffer the daily indignities that amount to an unfulfilled life. It is that message that empowered Egyptians, Yemenis, Libyans, Syrians and others to protest and die in the hope that their sacrifices would bring an end to their daily injustices.”
With that extraordinary act of protest by Mohamed Bouazizi, then the Arab Spring began.
2
'And they rule our world'; heavy way to end the article. I like the real, sincere, darkness in Krugman's voice: we're all going down.
I don't think we can celebrate greed and it's great concentrations of money without feeling it's poisonous consequences: man's inhumanity to man. If lucre's allure is why we're here, then we are doomed. If we promote and lobby for billionaires and their twisted self-interests, we live in a hellish state.
The real 'bad idea'? We can run society with corporations and modern pharaohs in charge, wage-slaves pushing the stones of our pyramids and love and equality belittled as just excuses made for poor, lazy people.
I don't think we can celebrate greed and it's great concentrations of money without feeling it's poisonous consequences: man's inhumanity to man. If lucre's allure is why we're here, then we are doomed. If we promote and lobby for billionaires and their twisted self-interests, we live in a hellish state.
The real 'bad idea'? We can run society with corporations and modern pharaohs in charge, wage-slaves pushing the stones of our pyramids and love and equality belittled as just excuses made for poor, lazy people.
6
In most all of Dr. Krugman's articles on the economic malaise gripping the US and big parts of Europe the central theme is that the wealthy, banks, and investment crowd have been able to spin out right falsehoods to the public via the media that influence the election of conservative governments. They in turn punish the middle class and poor. That this true is sadly proven here in the US and in Britain's recent elections. It does seem that the biggest isssue however is this last election was more about 'immigration' of muslims in particular from the former colonies and the role of the EU in the country's business affairs. There is a fear of terrorism, jobs, and culture that finds greater cause in the British Isles as well as Europe, than austerity. Obviously the wealthy are delighted in this distraction and can claim all kinds of anti-immigrant reasons to vote conservative.
Here in the US immigration has an entirely different take on political messaging, and will soon backfire on our conservative party, just anti gay topics, and militarism in the middle east is driving young voters in particular, towards the liberals at the polls. One thing that both nations have in common, very much so is the overwhelming negative influences of the wealthy and have enjoined in raking in the collective wealth of the middle, while savaging the poor. The real adgenda is to drive out or at least dramatically slow down the flood of immigrants, everywhere. Thus Kansans vote against themselved.
Here in the US immigration has an entirely different take on political messaging, and will soon backfire on our conservative party, just anti gay topics, and militarism in the middle east is driving young voters in particular, towards the liberals at the polls. One thing that both nations have in common, very much so is the overwhelming negative influences of the wealthy and have enjoined in raking in the collective wealth of the middle, while savaging the poor. The real adgenda is to drive out or at least dramatically slow down the flood of immigrants, everywhere. Thus Kansans vote against themselved.
1
The elite want to return to the land of Lords and serfs. But there is that pesky one person one vote things. So you must convince the masses to put the slave collar on willingly. So you have all this disinformation and propaganda spreading.
My ancestors came here hundreds of years ago fleeing Feudalism. I hardly think their descendants will willingly summit to it now. Does the French Revolution come to mind?
My ancestors came here hundreds of years ago fleeing Feudalism. I hardly think their descendants will willingly summit to it now. Does the French Revolution come to mind?
2
Agree Paul Krugman. But it is worse than you write here. There are some who are seriously about their wealth and power and that's where their seriousness comes from. They are serious about their selfishness and care not a wit if it makes a child hungry or blows up another one. They simply do not care about their fellowman. This is why the streets ran with blood in Paris in 1789. The filth and the squalor had become unbearable. I pray that the outcome of all of this selfishness is not so bloody. But eventually, people can be pushed to lash out. When that happens, like the 1789 explosion of human anger and grief, the good guys were under the giant knife as well as the truly nasty people of the upper classes. I think it should be a lesson to not have to be learned again, and serious people should think about the consequences of their selfishness. There has been some unrest in the world so far. From Furgeson to Africa, the Middle East, the streest of London and Pairs, people in the great unwashed so far have been successfully suppressed. The upper middle has fallen into the lower middle. The poor have gotten poorer. With the growing globalism and consolidation of corporate power, I do not see it having a good or peaceful outcome. Maybe this seems extreme, but it may not be.
6
The taxable national wealth of any nation, state, city, family, or etc. is the total value of all of privately owned taxable wealth that is located within and/or being created within the political boundaries of that nation.
Some of that existing wealth is available to be confiscated by the government at various levels to spend for various wealth consuming/destroying government activities such as infrastructure improvements, government payrolls, government benefits, wars, government contracts, and other government activities that consume that nation’s existing national wealth rather than create any new national taxable wealth.
Some of that existing wealth is available to be confiscated by the government at various levels to spend for various wealth consuming/destroying government activities such as infrastructure improvements, government payrolls, government benefits, wars, government contracts, and other government activities that consume that nation’s existing national wealth rather than create any new national taxable wealth.
2
Your point being . . . ?
1
I would like Mr. Krugman to begin writing about what the next president should be doing to help the economy in the U.S. Hillary is going to be giving an economic address next week. It would be good if he would say before her speech what he would like to hear her say and then to critique her speech afterwards. It would be nice if the Queen of polling came out bold instead of offering half measures.
3
Hillary Clinton says, "We need to build the economy of tomorrow, not yesterday."
What does that mean?
I hope that she does not mean continuing the Greek national economic plan of the Greek people living directly and indirectly off of the US government continuously borrowing of money to pay for the ever increasing government activities and then expecting a different result, such as the USA not going bankrupt!
What does that mean?
I hope that she does not mean continuing the Greek national economic plan of the Greek people living directly and indirectly off of the US government continuously borrowing of money to pay for the ever increasing government activities and then expecting a different result, such as the USA not going bankrupt!
2
One explanation of current UK public policy is party politics.
This has it that public sector workers tend to vote for the Labour party, which is largely funded by union contributions. In contrast, private sector workers vote Conservative.
So Labour benefits from a large (say >45% of GDP) public sector, and the Conservative party from a small one.
By this explanation, Osborne is trying to reset the UK status quo to a small public sector.
This has it that public sector workers tend to vote for the Labour party, which is largely funded by union contributions. In contrast, private sector workers vote Conservative.
So Labour benefits from a large (say >45% of GDP) public sector, and the Conservative party from a small one.
By this explanation, Osborne is trying to reset the UK status quo to a small public sector.
1
According to the good doctor, there is NEVER any reason to limit welfare spending or cut ANY government program. Once placed into service every program only "helps" the poor and to limit these to the most deserving is to chop their legs out from under them.
I speak from a little different position. I have many relatives who use these programs to avoid any responsibility in life. Three generations on assistance of many types and yet they are still poor and without any hope of getting ahead. They work just enough to get by-often under the table. Stay unmarried because the benefits are better. Lie cheat and steal our government because that is what they have been taught. In my opinion they work harder to stay on these programs than they might at real jobs. I see the abuse first hand.
Those of us on the right are fine with helping the helpless. It is the clueless that need a wakeup call. When Clinton was in office he eliminated "welfare as we know it". Now with Obama, we find that the requirements to find work, volunteer, or get training have been eliminated. We see how some of the largest programs like the Earned Income Tax Credit are abused to the tune of billions of dollars. We read how the SSI is overpaying with no oversight. We learn how our tax dollars are wasted-yet according to Krugman, every program is not only vital but keeps our economy strong.
Lest you think I am fine with corporate welfare-I'm not. This should be eliminated too.
I speak from a little different position. I have many relatives who use these programs to avoid any responsibility in life. Three generations on assistance of many types and yet they are still poor and without any hope of getting ahead. They work just enough to get by-often under the table. Stay unmarried because the benefits are better. Lie cheat and steal our government because that is what they have been taught. In my opinion they work harder to stay on these programs than they might at real jobs. I see the abuse first hand.
Those of us on the right are fine with helping the helpless. It is the clueless that need a wakeup call. When Clinton was in office he eliminated "welfare as we know it". Now with Obama, we find that the requirements to find work, volunteer, or get training have been eliminated. We see how some of the largest programs like the Earned Income Tax Credit are abused to the tune of billions of dollars. We read how the SSI is overpaying with no oversight. We learn how our tax dollars are wasted-yet according to Krugman, every program is not only vital but keeps our economy strong.
Lest you think I am fine with corporate welfare-I'm not. This should be eliminated too.
3
I've never seen Krugman advocate the policies you say he advances in your first paragraph. Your objection to welfare is moral - it leads to personal irresponsibility - whereas his support is economic - it promotes the health of the economy. You are talking past him. Nearly all of us take whatever entitlements we are offered for granted, and object to those that others enjoy while we don't. If you have a mortgage, you doubtless take a deduction from your federal income tax for the interest you pay on your home loan. Do you hang your head in shame? I don't. I've taken unemployment insurance at times. Farmers take subsidies, and scream if they are threatened with reductions. Self-reliance is a matter of degree, and business most of all relies on favorable legislation to fatten its profits. All capitalism is crony capitalism. So where are your upstanding citizens who don't "lie, cheat, and steal"? As for the corporate welfare cheats - let them begin the self-reformation: they're the biggest crooks, and unlike the Social Security overpaid, they DON'T NEED all the loot they steal.
2
"According to the good doctor, there is NEVER any reason to limit welfare spending or cut ANY government program."
He has said nothing of the sort. Your entire screed is so detached from reality, it doesn't even rise to the level of strawman. It's just nonsense based on lies you've been fed and willing digested.
He has said nothing of the sort. Your entire screed is so detached from reality, it doesn't even rise to the level of strawman. It's just nonsense based on lies you've been fed and willing digested.
1
Are these "very serious ideas?" Ones that mysteriously won't go away even when they've been exposed as wrongheaded, bad policy? Or merely necessary concepts that are the foundation of a highly efficient, and remarkably successful propaganda campaign waged on a 24/7 basis by the .1%?
Me? I'm going with the latter.
Let's be clear, the only goal of this political animal we call the "conservative" right is to protect and augment the wealth of the .1%. Nothing else matters.
Which is why the propaganda machine is so important. After all, the .1% are by definition in the minority. But if you tell a voter that black is white over and over and over again, they believe it. That's why the Brits voted the Conservatives in, and that's why, to a great extent, the Republicans control the Congress.
Historians will be aghast as they analyze this period in Western history. They will be amazed at the power amassed by the .1%.
What happens after their power structure is dismantled is entirely up to us.
I've given Bernie Sanders $100, have you?
Me? I'm going with the latter.
Let's be clear, the only goal of this political animal we call the "conservative" right is to protect and augment the wealth of the .1%. Nothing else matters.
Which is why the propaganda machine is so important. After all, the .1% are by definition in the minority. But if you tell a voter that black is white over and over and over again, they believe it. That's why the Brits voted the Conservatives in, and that's why, to a great extent, the Republicans control the Congress.
Historians will be aghast as they analyze this period in Western history. They will be amazed at the power amassed by the .1%.
What happens after their power structure is dismantled is entirely up to us.
I've given Bernie Sanders $100, have you?
2
Seriously Bad Ideas:
A livable minimum wage will destroy the economy.
Taxing dividends, capital gains, and any other source of unearned at current marginal tax rates, or even higher, will destroy the economy.
Applying the Social Security and Medicare taxes to all income, regardless of amount (which is currently the case for the vast majority of Americans) will destroy the economy.
Requiring churches and religious organizations to pay property taxes will destroy the economy.
Requiring two years of universal service (military, Peace Corps, Civilian Conservation Corps, etc.) within 10 years of high school graduation will destroy the economy.
Developing a functional high-speed rail service between major population centers, along with feeder lines connecting outlying small metropolitan areas will destroy the economy.
Addressing the current crisis of infrastructure decay and failure will destroy the economy.
Rebuilding the metaphorical wall separating church and state will destroy the economy.
Electing a President who does not believe all of the above will destroy the economy.
A livable minimum wage will destroy the economy.
Taxing dividends, capital gains, and any other source of unearned at current marginal tax rates, or even higher, will destroy the economy.
Applying the Social Security and Medicare taxes to all income, regardless of amount (which is currently the case for the vast majority of Americans) will destroy the economy.
Requiring churches and religious organizations to pay property taxes will destroy the economy.
Requiring two years of universal service (military, Peace Corps, Civilian Conservation Corps, etc.) within 10 years of high school graduation will destroy the economy.
Developing a functional high-speed rail service between major population centers, along with feeder lines connecting outlying small metropolitan areas will destroy the economy.
Addressing the current crisis of infrastructure decay and failure will destroy the economy.
Rebuilding the metaphorical wall separating church and state will destroy the economy.
Electing a President who does not believe all of the above will destroy the economy.
9
Only the private businesses wealth creation activities in any nation creates new taxable wealth, and that new and existing privately owned taxable wealth is the primary (almost the only) source of funds to be confiscated by governments through taxes to pay for any and all wealth consuming government activities.
1
Bridges, highways, power grids, water delivery systems, standards of doing things to assure the free flow of everything in a complex and diversified country, as well as law courts, and controlling how vast numbers of people are able to live together in peace and prosperity, safe in their persons and possessions, universal education, freedom of conscience and expression, common purchasing of public goods by taxpayers, sharing of the risks from inadequate resources that prevent care for those who need it, and armies and navies are far more that wealth consuming activities, they enable wealth to be created and used as people want.
How much can any government confiscate from the taxable wealth creators to pay for "Bridges, highways, power grids, water delivery systems, ........ law courts, .... universal education, .... and armies and navies ... " before the taxable wealth creators close down their businesses and relocate their jobs to another nation?
1
http://www.nytimes.com/1983/06/19/business/business-forum-it-s-all-too-e...
"Economists are always recommending the elimination of this or that ''market imperfection'' when they see facts that do not correspond with their basic model of a price auction. If wages do not fall with higher unemployment, it is due to the market imperfection of monopolistic unions. In contrast, no astrophysicist recommends the elimination of of a planet he has observed because it doesn't fit his grand scheme of the universe and is thus a ''planetary imperfection.''
"Economists are always recommending the elimination of this or that ''market imperfection'' when they see facts that do not correspond with their basic model of a price auction. If wages do not fall with higher unemployment, it is due to the market imperfection of monopolistic unions. In contrast, no astrophysicist recommends the elimination of of a planet he has observed because it doesn't fit his grand scheme of the universe and is thus a ''planetary imperfection.''
2
A key to the success of American conservatives is the fabrication of their own alternate reality, in which seriously bad ideas become quasi-religious dogma that produces results that have at best a tenuous connection with the real world. Repeated relentlessly by conservative politicians and propaganda organs, with the funding of wealthy individuals and corporations that greatly benefit from the seriously bad ideas, the alternate reality becomes truth to millions of people, who then consistently and reliably vote against their own interests. This approach persists because it successfully works to keep conservatives not only in power, but in a position to define the terms of political discourse.
I'm puzzled that the same approach seems to be working in Britain, which does not have the corrupt "one dollar, one vote" political system that distinguishes the United States. Perhaps it reflects the tendency to rally round demagogues when the going gets tough.
I'm puzzled that the same approach seems to be working in Britain, which does not have the corrupt "one dollar, one vote" political system that distinguishes the United States. Perhaps it reflects the tendency to rally round demagogues when the going gets tough.
2
If you want to see the best example of a seriously bad idea, look at Kansas. It's the ultimate repudiation of any thought that trickle-down economics actually works. What Brownback has wrought has destroyed the state. And now, to raise revenues to fix the $400 million budget hole for 2016 he's doing that with use taxes on the backs of ordinary people -- after giving huge tax breaks to the wealthy and to businesses, supposedly in the name of job creation. Didn't work. While I still don't understand why Kansas voters reelected this insane governor and his inept legislature, I would hope they'd realize the error of their ways and vote these idiots out of office next time around. If not, the giant sucking sound you hear will be the formerly great state of Kansas disappearing into a giant sinkhole.
7
Taking Wisconsin and a few others with it. After all, why should that giant sucking sound be enjoyed by Kansas alone? New Jersey with Chris Christie could go the same way as could Louisiana, the former Republic of Texas, and maybe even some neighboring states. It could become a chain reaction and take the entire United States down. That would be very interesting.
1
In a world now dominated with data of all kinds, and calls for examine the data, that or policy makers rarely look at the data, examine the data, or really care about the data -- they care about getting elected, getting a lobbying job, and pushing bad ideas that get them elected and that well paying lobbying job. The real fault lies with a public consumed with the contest or reality show of the week leaves little time to examine really bad ideas.
1
Who does austerity favor? Who gets the most out of tax cuts? Who suffers the least from cuts in social programs? Who can protect themselves the most from downturns in the economy? The very rich and big financially secure corporations. These same entities can lobby for their points of view. The rest of us are too busy struggling to survive. The Gouty Odiferous Prunes adore big business and the very rich because they are their source of money for campaigns. These same prunes live in an America that doesn't see its citizens as people. We are the payers of taxes. We are the freeloaders who need assistance when we can't find jobs or go bankrupt from unemployment or medical bills. We belong in workhouses or somewhere where we can't be seen. If we aren't seen all the things they say make perfect sense.
Welcome to the new America. Home of the feckless with your money and begrudging with the help unless you're part of the 1%. They will disinvest in America on the grounds that the government they don't allow to function doesn't function. They will continue to pay themselves with our tax dollars just so they can ensure a dysfunctional government. And no, they do not care about our health, our educational system, or anything that involves the less than very, very rich. That's why they love austerity, tax cuts, and letting America fall apart on their watch.
Welcome to the new America. Home of the feckless with your money and begrudging with the help unless you're part of the 1%. They will disinvest in America on the grounds that the government they don't allow to function doesn't function. They will continue to pay themselves with our tax dollars just so they can ensure a dysfunctional government. And no, they do not care about our health, our educational system, or anything that involves the less than very, very rich. That's why they love austerity, tax cuts, and letting America fall apart on their watch.
3
I wonder if austerity in European countries and Britain is really a covert means of diverting government benefits from immigrants? It would be politically extremely difficult to do this overtly, so why not, in the name of "austerity", do this as a way to make it more difficult for people to migrate to Europe and get on the dole? Perhaps I'm being simplistic, but how else explain adherence to a strategy intended to fight problems, as Professor Krugman puts it, that don't exist?
There is no honest discussion about economies and of how they work, there is lots of discussion about what can be done to coax them or restrain them by tax and monetary policies and controlling public spending related to very small effects that reach statistical significance. The reason is that those who have the most to say are not being adversely affected by anything that has happened since the financial markets crashed, the losses that they sustained at that time might have been considerable but it was not so much that they have been unable to recover. Meanwhile whole nations are struggling to restore enough growth to provide employment and to support their public institutions and services to benefit everyone.
The U.S. has a big and dynamic economic system but too much of the new wealth created is being prevented from allowing it to grow and to adapt as it must to provide full employment and enough shared wealth to support all the needs of a modern state by private entities which are quite properly risk averse in the current economy. The slogans about lowering taxes creating jobs and austerity saving future generations from burdensome debt is senseless jabber motivated by those with control of the potential capital for growth fears over the risks of further investing in the weakly expanding economies foreign and domestic.
The U.S. has a big and dynamic economic system but too much of the new wealth created is being prevented from allowing it to grow and to adapt as it must to provide full employment and enough shared wealth to support all the needs of a modern state by private entities which are quite properly risk averse in the current economy. The slogans about lowering taxes creating jobs and austerity saving future generations from burdensome debt is senseless jabber motivated by those with control of the potential capital for growth fears over the risks of further investing in the weakly expanding economies foreign and domestic.
While it's probably true that an austerity program of the kind the UK is on the verge of permanently implementing is a "seriously bad idea", there really is only one sure-fire way to find out. That is of course to let it happen and see the results. Odds are that it will be anything but a permanent policy.
We need to adopt a similar strategy for the US. Let the radical right implement their seriously bad ideas but then hold them accountable at the ballot box for the results. The result is likely to be, as the signs at road construction projects often say, "temporary inconvenience - permanent improvement."
We need to adopt a similar strategy for the US. Let the radical right implement their seriously bad ideas but then hold them accountable at the ballot box for the results. The result is likely to be, as the signs at road construction projects often say, "temporary inconvenience - permanent improvement."
Somebody's not paying attention. it's already been tried out.
"Let the radical right implement their seriously bad ideas but then hold them accountable at the ballot box for the results."
Genius. As if somehow the public is going to figure it all out when nobody is telling them. As if all the damage the GOP will do will have the effect of holding them accountable. Just like it has all the last 30+ years.
"Let the radical right implement their seriously bad ideas but then hold them accountable at the ballot box for the results."
Genius. As if somehow the public is going to figure it all out when nobody is telling them. As if all the damage the GOP will do will have the effect of holding them accountable. Just like it has all the last 30+ years.
Worked out really well in Kansas and Wisconsin, didn't it?
Really? Balancing the budget is a bad idea when the economy is growing? How so? Isn't that exactly the kind of fiscal policy that conventional economists recommend to prevent economies from overheating? There is a reason that at least this serious idea has a lot of staying power, and that is that it is morally wrong. Furthermore, we all know it is wrong. Borrowing money that our children will have to pay off (or pass on to their own children) is simply wrong. Right now, if we divide the US debt of $21 trillion by the approximately 80 million people born in the US during the last 20 years, each new citizen is saddled with a debt of $250,000, and that's assuming we were to balance our budget today. Unfortunately, thanks to Mr. Krugman and his ilk, we keep borrowing and increasing the debt. The British should be commended for trying to correct this situation, rather than kicking the debt payment down the road for another generation to pay.
5
Government economics is not home economics. This is one of the most persistent fallacies of modern timess.
3
unfortunately, government morality is not home morality either.
So the economy is overheating?
1
Very Serious People have learned to hold and promote any and all ideas that support their class's propaganda agenda. For a VSP, satisfying the power agenda is the only test that confirms an idea's "validity". In their world, ideas are propaganda tools: not theories for improving understanding, not words and concepts aiming to convey a clearer view of reality. All sophistry; no dialectic. And their academic pets know that if they disagree with, or even try to moderate, the foolishness of their "teammates", they will get kicked out of the debate club - not be taken seriously - banished into obscurity! At least its not hemlock.
4
All those French moving from socialist governed France to London - estimated to be by now about 400 000 - must be suffering from seriously bad ideas.
http://www.independent.co.uk/news/world/europe/french-say-au-revoir-to-f...
http://www.independent.co.uk/news/world/europe/french-say-au-revoir-to-f...
2
Larry Bartels and others have shown that the US is a plutocracy in it reflects the views of the top tenth of a percent of the income pyramid and no more. Therefore I conclude that the ultra-rich want the trans-pacific partnership. As for seriously bad ideas bear in mind that the ultra-rich increase their power at the expense of the rest of society under British policies. It's no surprise that these ideas which were discreditedd in the Great Depression of 1929 are still present. All one has to ask is who benefits from them. in 1929 one could claim that there was widespread ignorance of the economic reality this claim is no longer realistic. Karl Marx has said things happen twice in history first this tragedy then as farse. This is amongst the biggest farses as you ever want to see
3
Farse is much too weak of world to describe the intentional destruction that is underway.
1
"No matter how much contrary evidence comes in, no matter how often and how badly predictions based on those ideas are proved wrong, the bad ideas just keep coming back. And they retain the power to warp policy."
No effort has been attempted to pushback against the seriously bad ideas. That's the problem. The whole problem.
Most people just aren't as stupid as the American people would make us conjecture. It's all being done purposefully and with full recognition of the results.
Seriously bad ideas -- whose detrimental consequences we clearly know -- come from seriously bad people who have power.
No effort has been attempted to pushback against the seriously bad ideas. That's the problem. The whole problem.
Most people just aren't as stupid as the American people would make us conjecture. It's all being done purposefully and with full recognition of the results.
Seriously bad ideas -- whose detrimental consequences we clearly know -- come from seriously bad people who have power.
3
I have read that the reason for the severity of the last recession, and the depth of the Great Depression, was a too high level of debt among the general public due to wages being too low to support adequate consumption. Is this true? Is our economic problems at least in part due to an inadequate level of income among the general public, causing a deficit of demand?
1
That's essentially what a recession is.
The Republicans are afraid of us, the voters. That's why they have gerrymandered safe Congressional Districts (mine is 106 miles long, extremely misshapen and at points as narrow as 30 feet where it travels down alleys). That's why they make it difficult for us to vote, sometimes impossible. That's why, in Ohio, my voting precinct had voting machines in such excess that many were not even used while in Democratic neighborhoods they had three and voters had to stand outside in the rain until midnight, to vote, permissible by court order sought by the Democratic Party.
They see their days as numbered because voters have wised up. They know their enemy. It won't just be in Democratic neighborhoods where they will lose. So they have to pass as much legislative garbage as they can.
They know the Koch Brothers' money won't sway votes. We heard it too often before, their lies, only to suffer the consequences when they shed their sheep's clothing, once elected.
They see their days as numbered because voters have wised up. They know their enemy. It won't just be in Democratic neighborhoods where they will lose. So they have to pass as much legislative garbage as they can.
They know the Koch Brothers' money won't sway votes. We heard it too often before, their lies, only to suffer the consequences when they shed their sheep's clothing, once elected.
6
Great Britain suffered from gerrymandering too in the 1800s when safe seats were established to protect conservatives from voter sanction. It is a time-honored, wrong-headed approach that was finally thrown out by labor revolts.
Of course, it would help if the Democrats offered a genuine alternative. Instead, we have fake progressives trying to convince us that it will be alright as long as we elect them. Never mind the dark money feeding our campaigns: we're not beholding to them.
Of course, it would help if the Democrats offered a genuine alternative. Instead, we have fake progressives trying to convince us that it will be alright as long as we elect them. Never mind the dark money feeding our campaigns: we're not beholding to them.
1
Please explain how gerrymandered districts effect statewide or national elections? They don't.
The left was fine with gerrymandered districts when it was they who drew them. That the other side should put in place the same-disaster!
No mention of the left's own political heavyweights like Soros, Jon Stryker, Jeffrey Katzenberg, every union, the trial lawyers and on and on. The Koch's want us to follow the Constitution-HORROR! I would think our Constitutional Scholar president would be fine with that rather than "transforming" our nation.
The left was fine with gerrymandered districts when it was they who drew them. That the other side should put in place the same-disaster!
No mention of the left's own political heavyweights like Soros, Jon Stryker, Jeffrey Katzenberg, every union, the trial lawyers and on and on. The Koch's want us to follow the Constitution-HORROR! I would think our Constitutional Scholar president would be fine with that rather than "transforming" our nation.
1
They don't? Of course they do. Why else would they be shaped by Republicans so oddly to pick up a few democrats and offset them with tons of republicans. What they affect (not effect) are statewide legislature races, and Congressional (House of Representatives) races. Gerrymandering is why, statewide, Republicans vote totals were less than Democrats, but they won a majority of seats in the House in many states in the last election.
Explain to me please, how the Kochs want the country to follow the Constitution. I haven't heard that one.
Explain to me please, how the Kochs want the country to follow the Constitution. I haven't heard that one.
1
Economic policy unmoved by feedback from real world data is sustained by a quasi-religious moral commitment to how the world ought to work. This is the characteristic of "Seriousness" which defines it, rather than any hypocritical use to which it may be put. Against such an ultimate perspective, lesser theories and facts fare badly--maybe not inevitably, but relentlessly enough to require acknowledgment.
2
For most human beings, feelings trump reason. The only hope I see for getting through to people is to find alternate feelings that conflict with the ones that are causing the most harm, and appeal to those contradictory feelings.
Once I figure out precisely how to get that to work, I'll let you know......
Once I figure out precisely how to get that to work, I'll let you know......
4
Some examples of seriously bad ideas - deregulation, privatisation, free trade, a floating or capricious currency, perpetual growth and globalisation.
No matter how much contrary evidence comes in, no matter how often and how badly predictions of the benefits of the economic theory is proved to be wrong, it is somehow accepted as economic orthodoxy and we carry on regardless.
No matter how much contrary evidence comes in, no matter how often and how badly predictions of the benefits of the economic theory is proved to be wrong, it is somehow accepted as economic orthodoxy and we carry on regardless.
4
"...seriously bad ideas - deregulation, privatisation, free trade, a floating or capricious currency, perpetual growth and globalisation."
Except for the floating currency, clearly true. But there's no real alternative to a floating currency.
Except for the floating currency, clearly true. But there's no real alternative to a floating currency.
1
Left unwritten is the fact that the integrity of bankers tends to be closely linked to the distance between their depositors and their borrowers. The further apart they are, they easier both are to scam. Banking is traditionally a local business where depositors can see where their money is loaned, and bad loans get worked out without loss to depositors.
The games central banks play with interest rates delocalized banking by making future interest rates unpredictable, and a casino of derivatives larger than the global product was built upon it.
We are still a long way from separating the variables of fiscal and monetary policy in the manner need to stabilize the system.
The games central banks play with interest rates delocalized banking by making future interest rates unpredictable, and a casino of derivatives larger than the global product was built upon it.
We are still a long way from separating the variables of fiscal and monetary policy in the manner need to stabilize the system.
3
Isn't this the same argument President Jackson made when he dissolved the central bank in the 1830's? The economy collapsed!
No, federal banks play a key role, as shown during Paul Volker's tenure, in controlling inflation. It is left to us to demand legislation that controls the large banks. Stability is achieved by forcing out cash stuck in shadow banks, hidden by the rich, into the financial system and using these resources wisely to improve technology, infrastructure, education, take on risky new ventures, etc. Stability, in short is lots of money circulating: you need central banks to regulate circulation.
No, federal banks play a key role, as shown during Paul Volker's tenure, in controlling inflation. It is left to us to demand legislation that controls the large banks. Stability is achieved by forcing out cash stuck in shadow banks, hidden by the rich, into the financial system and using these resources wisely to improve technology, infrastructure, education, take on risky new ventures, etc. Stability, in short is lots of money circulating: you need central banks to regulate circulation.
Last summer, my wife and I rented a car in Southampton and drove southwest to Penzance. On the map it looked like it might take a few hours. If the British rail makes Amtrak look modern, British roads make our highways look like Nascar. Not only they drive on the wrong side of the road, but there are virtually no roads that are recognizable as highways, no shoulders, and many roads are so narrow in parts that two cars can't pass at the same time! Repairing and modernizing England's roads would bring full employment for years
1
This excellent article continues analysis of the great economic conundrum of our time - How can there be so much public support for such bad economic policy? To restate the problem in political terms - Why do so many citizens in England and the US continue to adhere to political solutions so demonstrably opposed to their optimal economic interests? Let me submit that the answer is grounded Keynes' classic hypothesis - the Paradox of Thrift. In my opinion, it's only through the application of this concept that we can understand the stubborn wave of contemporary meta self delusion and harm. The problem's intransigence is severely aggravated by the myth that relative degrees of wealth correspond to moral and social superiority over the less fortunate of the world. Such ego-stroking also used be more strongly driven by birthright, ethnicity, and race. Obviously, these are still important, but feeling superior to others in an age of such great wealth is primarily achieved by the possession thereof. Insightful psychology might argue that this problem stems from a subconscious fear of death. Whatever its cause, it plays directly into the hands of those who benefit most from this situation, the ultra rich, whose minions employ modern media propaganda to cement their agenda in the minds of so many. A time-honored technique (e.g., how did the slave-owning planters of the American South dupe the non-slaveholding poor whites into fighting the Civil War?), of continued effectiveness.
8
What do the Oxford dons say about all this? Do they comprehend their government is delusional? If so do they attempt to communicate this to the public? Does the press ever reach out to them for their insight?
2
I have many friends and former colleagues in London. This is my message to them. Quote: I am sorry that you guys made a wrong choice based on deception by the Tories' meme circulated by economic journalists. Sorry to say but you guys are destined to experience longer difficult time like our mutual friends in Japan. British core inflation has been declining since September 2014 at 1.5% to current 0.8%. Your continued austerity may lead you to similar deflation that our Japanese friends experience. Remember, the Japanese tried hard to overcome deflation since 1998 and we both commiserated with the Japanese friends whenever we met in Tokyo, London or New York.
Now, we all see the sign of potential deflation even in China, the country of eternal high growth. China managed to stop recently the worsening economic deterioration but ,as you know, they won't be able to overcome piling housing inventories nationwide except in the big cities. Their trouble has started already from regions, not big cities.
We may also encounter possible deflation at some point of future because of our own productivity problem and slowly declining growth of working age population. Our key for the bad luck will be same as your Osborne policy called 'austerity' that our Republicans love to use.
Now, we all see the sign of potential deflation even in China, the country of eternal high growth. China managed to stop recently the worsening economic deterioration but ,as you know, they won't be able to overcome piling housing inventories nationwide except in the big cities. Their trouble has started already from regions, not big cities.
We may also encounter possible deflation at some point of future because of our own productivity problem and slowly declining growth of working age population. Our key for the bad luck will be same as your Osborne policy called 'austerity' that our Republicans love to use.
4
Lately I've been reminded of the movie Dr. Zivago. When he returns to his palatial home in Moscow to find a hundred people living there while he and his family get one room. He is told, you had all this wealth and we had nothing, now you have the same. Rich oligarchs are crowding out the rest in cities like NYC and London but they have no sense of history. A more equitable economic system will give them so much, but they want it all and have government puppets doing the dirty work to make that happen. In the end, history will repeat itself and they will end up with nothing.
8
How are "rich oligarchs...crowding out the rest in cities like NYC and London"? Are they buying up all of the one and two bedroom affordable apartments, or are they buying multi-million dollar penthouses? Only those rich oligarchs or others like them can afford the property they are buying. They are not depriving "the rest of us" of anything that would ever be within our reach. In fact, they are creating thousands of jobs for the rest of us, to build and maintain all of the new properties being constructed to accommodate them. Just think of all of the factory workers and artisans building and installing their up-scale appliances, furniture, carpeting, artwork, elevators, heating, security and lighting systems, and on and on. Not to mentions the doormen, chauffeurs, bodyguards, maids, cooks, repairmen, garage keepers and other minions that earn their living because rich people are voluntarily transferring a portion of their wealth to the rest of us through their high living. Wealth that none of us would otherwise pass through our hands even if these evil rich persons never had a penny. Hooray for the oligarchs bringing their money to us.
The lies of the big guys to justify their grabbing the whole pie, feeds off of the financial crisis like fungus feeds off of disease.
3
Great ideas were of bad attitudes that resulted into the creation of theories; systems; formulas and so on...
We cant blame bad ideas for the current situation but rather appreciate their presence to evaluate our leaders and institutions.
We cant blame bad ideas for the current situation but rather appreciate their presence to evaluate our leaders and institutions.
Perhaps "some readers are thinking that I’m giving the likes of Mr. Osborne too much credit for sincerity," but I'm not. I'm thinking I've read this column twenty times before. You need some new material.
No. We need it twenty more times. Slow people and slow learners need very special needs and more care. You have to take your time with them.
I'll bet you don't complain to the liars who keep telling you that deficits and debt are the problem, or that interest rates have to rise, or that social programs for the needy have to be slashed, or that ...
Now why is that?
I'll bet you don't complain to the liars who keep telling you that deficits and debt are the problem, or that interest rates have to rise, or that social programs for the needy have to be slashed, or that ...
Now why is that?
1
They are not really "ideas." They are excuses.
"It must also absolve corporate interests and the wealthy from responsibility."
That's the key.
"It must also absolve corporate interests and the wealthy from responsibility."
That's the key.
23
There are never again going to be enough 'well-paying jobs' to go around. We can't stand to look at this and to begin to design a global society for the next hundred years that adapts to this fact.
It's like concussion in NFL football -- we really really don't want to think about it. But when Terry Bradshaw and Mike Ditka (both 100% NFL football guys' guys) say publicly that *they* would not let *their* sons play NFL football, we know the long slow end has begun.
Of course we should make as many 'good jobs' as possible, but we also need to figure out how to design a 'common human floor' that treasures each human being as a sister/brother, a fellow earthling on a blue dot in very vast space. As the astronaut said, "When I looked back at our planet Earth from space, what struck me is that there aren't any lines on it." We need to internalize *that* as the centuries and generations roll on.
It's like concussion in NFL football -- we really really don't want to think about it. But when Terry Bradshaw and Mike Ditka (both 100% NFL football guys' guys) say publicly that *they* would not let *their* sons play NFL football, we know the long slow end has begun.
Of course we should make as many 'good jobs' as possible, but we also need to figure out how to design a 'common human floor' that treasures each human being as a sister/brother, a fellow earthling on a blue dot in very vast space. As the astronaut said, "When I looked back at our planet Earth from space, what struck me is that there aren't any lines on it." We need to internalize *that* as the centuries and generations roll on.
22
Ownership of the means of production has to be broadly distributed to sustain demand for the output of robots. This is a problem for people who concentrate wealth for power.
1
Professor Reich was the US Secretary of Labor when NAFTA, the first FTA with a third world nation, was unilaterally signed into law by President Clinton and that removed those import tariffs on products from Mexico, so all of the higher paying US STEM jobs possible were "Sucked off to Mexico" just like Ross Perot forecasted!
The US Jobs flipping hamburgers, cleaning toilets, and selling insurance are still left in the USA because there is not much of any way to relocate those jobs to third world nations.
The US government has created all of these "Free Trade Agreements" and similar trade treaties such as President Clinton’s NAFTA and his PNTR for Communist China (Google Chinagate), that economically require all US workers to compete for jobs by offering to work for less money (including US worker benefits) than Foreign workers are available to do those same jobs, including college and trade school educated STEM workers!
This is a problem for US working class citizens.
Doesn’t everybody know that all this free trade agreement legislation created in the last twenty years by the last three recent US Presidents and Congress was the main financial cause for union and non-union US located jobs for the blue-collar and the white collar working citizens of the USA to relocate to foreign nations?
Why then did our elected presidents and congressmen create all of these "free trade legislation" laws that economically required US businesses to relocate as many US jobs as possible to foreign nations if US workers will not work for the same wages that are available in third world nations as allowed and economically required by the Free Trade Agreements and the Most Favored Nation trade statuses?
Were our elected presidents and congressmen ignorant, stupid, dishonest, evil, or some combination of these factors?
How/why do you think these free trade agreements were created?
The US Jobs flipping hamburgers, cleaning toilets, and selling insurance are still left in the USA because there is not much of any way to relocate those jobs to third world nations.
The US government has created all of these "Free Trade Agreements" and similar trade treaties such as President Clinton’s NAFTA and his PNTR for Communist China (Google Chinagate), that economically require all US workers to compete for jobs by offering to work for less money (including US worker benefits) than Foreign workers are available to do those same jobs, including college and trade school educated STEM workers!
This is a problem for US working class citizens.
Doesn’t everybody know that all this free trade agreement legislation created in the last twenty years by the last three recent US Presidents and Congress was the main financial cause for union and non-union US located jobs for the blue-collar and the white collar working citizens of the USA to relocate to foreign nations?
Why then did our elected presidents and congressmen create all of these "free trade legislation" laws that economically required US businesses to relocate as many US jobs as possible to foreign nations if US workers will not work for the same wages that are available in third world nations as allowed and economically required by the Free Trade Agreements and the Most Favored Nation trade statuses?
Were our elected presidents and congressmen ignorant, stupid, dishonest, evil, or some combination of these factors?
How/why do you think these free trade agreements were created?
1
Really? Krugman is an expert on the economics of England?
2
Economic theories are not specific to countries. What changes are the actual economic situation of a country and that is known on the basis of economic data. So Krugman and others can comment on what is done or not done in a specific country. Otherwise, the economic assessment by the United State of the different countries of the world would not be possible.
9
Yeah. And of Great Britain, not to mention the UK. As it turns out, capitalism works (and doesn't work) the same way in every country. That's because people are pretty much the same all over-- they all want "more". And when they get "more", they still want "more". Countries' politics varies, but Krugman seems to have the Tories' and Labour's number.
3
Yours is a lame comment. Economics is a science - a social science to be sure - but still one that uses model building, hypotheses, logic and mathematics. A physicist would not need training in "British" physics to work in Britain, because there is no "British" physics. Nor is there "British" economics. Now there is British politics, which affects the economy (and the physics I suppose, or at least the financing of the physics) but even the Brits don't understand their politics.
The example cited by Prof. Krugman concerning England's inability to recognize the true causes of their economic problems is, unfortunately, being mirrored here in the States as well.
I've noticed a deeply disturbing trend here where the Republicans have managed to fool much of the voting public into believing that only they know how to solve our problems when, in truth, just about all of our economic problems can clearly be attributed to them and for the exact same reasons outlined by Prof. Krugman in his editorial i.e.financial deregulation and austerity measures.
Upon analysis, I believe this effort on the part of Republicans to rewrite history (through their distorted ideological lens) is a conscious and deliberate attempt to forcibly change the face and scope of our democracy by whatever means possible. We've already witnessed some of the damage already through some of the recent Supreme Court's decisions e.g. Citizens United and the gutting of the Voting Rights Act.
If our media cannot remain independent and merely echoes the lies and distortions of these wretched Republicans, we are all in for a very rough ride indeed. We need to educate all of our citizens in meaningful ways so that they can't be so easily fooled.
And it goes without saying that we MUST get people to recognize the importance of voting in ALL elections (and not just presidential elections). If they had, we wouldn't be saddled with a Republican controlled House and Senate as we currently are.
I've noticed a deeply disturbing trend here where the Republicans have managed to fool much of the voting public into believing that only they know how to solve our problems when, in truth, just about all of our economic problems can clearly be attributed to them and for the exact same reasons outlined by Prof. Krugman in his editorial i.e.financial deregulation and austerity measures.
Upon analysis, I believe this effort on the part of Republicans to rewrite history (through their distorted ideological lens) is a conscious and deliberate attempt to forcibly change the face and scope of our democracy by whatever means possible. We've already witnessed some of the damage already through some of the recent Supreme Court's decisions e.g. Citizens United and the gutting of the Voting Rights Act.
If our media cannot remain independent and merely echoes the lies and distortions of these wretched Republicans, we are all in for a very rough ride indeed. We need to educate all of our citizens in meaningful ways so that they can't be so easily fooled.
And it goes without saying that we MUST get people to recognize the importance of voting in ALL elections (and not just presidential elections). If they had, we wouldn't be saddled with a Republican controlled House and Senate as we currently are.
7
People are stubborn even when the evidence proves that they are wrong. People vote for parties that they believe will deliver more prosperity when in fact evidence suggests otherwise. Right wing governments identify themselves as pro growth and prosperity and people really do buy into that propaganda despite the same governments crashing the economy. It is an inherent prejudice that we have and probably the reason right wing parties get any votes at all, the greed impetus. Left wing parties will not progress unless they can fight this belief.
9
Europe's central banks lack the Fed's dual mandate to foster full employment AND keep keep inflation in check. In Europe central banks' only mandate is to keep inflation in check. This invariably tilts European government policy in economic crises towards austerity. The political motive behind this tilted arrangement, as always, is to guard accumulated wealth from any possible erosion arising from deficit spending, which is always presumed by those who have accumulated wealth to lead immediately and inexorably to out of control inflation and loss of accumulated wealth. Adopting a dual mandate for the Bank of England and other central banks in Europe would greatly help rebalance this harmful tilt toward austerity.
That said, even in the UK conservative party there is a general consensus that tax rises are always considered a part of the mix for balancing national budgets, which is certainly no longer the case in the modern US Republican party.
That said, even in the UK conservative party there is a general consensus that tax rises are always considered a part of the mix for balancing national budgets, which is certainly no longer the case in the modern US Republican party.
3
"But Mr. Osborne sounds very serious, and, if history is any guide, the Labour Party won’t make any effective counterarguments."
Sounds like the Democrats here in the US. When are they going to start parroting a narrative that promotes their beliefs and superior solutions to our nation's problems. Repeated often enough we could beat the Republicans at their own game. Where's the problem? Is it because the Democrats have sold out to moneyed interests as well?
Sounds like the Democrats here in the US. When are they going to start parroting a narrative that promotes their beliefs and superior solutions to our nation's problems. Repeated often enough we could beat the Republicans at their own game. Where's the problem? Is it because the Democrats have sold out to moneyed interests as well?
6
Please, Dr. Krugman, don't visit Kansas or Wisconsin anytime soon. Your head will explode.
5
Celia, thanks for the laugh! I love your comment and "your head will explode." So, true!
1
In Britain like in the U.S. the sluggish recovery has been good for a small fringe of the population while the big majority struggles to make ends meet. Despite the sufferings of a large majority of ordinary people we keep electing politicians who genuinely don't care about the wellbeing of their co-citizens in the Congress or the House of Commons. It's sad to say but we have the politicians that we deserve...
1
Sorry, Mr. Krugman, but I think the British passenger trains are far superior to ours. We rent a house outside of Windsor every year and go into London and up north by train and they are timely, clean and comfortable and also don't make half the noise ours do. So I must beg to differ on this one.
8
Also two of my English cousins took the train from Penn Station to Rochester. They were stuck in the middle of nowhere for 90 minutes. Couple of days later they took it from Rochester to Buffalo - stuck in the middle of nowhere for 2 hours. I think we have some serious infrastructure work to do in this country - or we can just disintegrate into a 10th world country. It's up to all of us..
1
American passenger trains are so awful that even British trains are better. Still, the British trains are far below world standards, and the British complain about that all the time.
1
From my personal experience the Brits complain about everything but frankly I don't see any difference between their trains and those on the continent. Maybe it depends in what part of the country you are riding on them.
Most people who think and read ,know exactly why the economic crisis happened ,as partially explained early in your article. You failed to make mention that financial institutions running wild was caused by the repeal of the Glass/ Steagall act passd years ago to avoid such economic predicaments..
Repealed by democraticPresident William Jefferson Clinton....please report the full facts and story when writing your column Mr Krugman.
Repealed by democraticPresident William Jefferson Clinton....please report the full facts and story when writing your column Mr Krugman.
3
The bill was written by Phil Gram, republican of Texas, who went on to a very lucrative job at UBS. Clinton signed it at the urging of Bob Rubin at the end of his second term. While allowing banks to gamble and leverage more, it didn't solely cause the recession. The mortgage industry, massive tax cuts for the wealthy during a time of war, deregulating other markets and ignoring the derivatives market all helped.
3
C'mon. Clinton didn't repeal Glass-Steagall - Congress did. He just signed the omnibus budget agreement put together by the Republican Congress into which they stuffed the poison pill of the repeal.
Sandy Weill had one year to bring his acquisition of Citibank to a corporation that included Shearson-Smith Barney and Travelers Insurance into compliance with Glass-Steagall. Note that, instead of making arrangements to bring the organization into compliance, he spent that entire year lobbying for the repeal. He just made it. These are the kind of people that got the repeal. (I worked at two of those companies during his tenure.)
It's interesting to note that it took only nine years for the financial industry, freed from the constraints that had protected us for about 70 years, to destroy the economy.
Speaking as a guy who worked in those industries from 1975 to 2002, these people CANNOT be trusted. They MUST be regulated.
Sandy Weill had one year to bring his acquisition of Citibank to a corporation that included Shearson-Smith Barney and Travelers Insurance into compliance with Glass-Steagall. Note that, instead of making arrangements to bring the organization into compliance, he spent that entire year lobbying for the repeal. He just made it. These are the kind of people that got the repeal. (I worked at two of those companies during his tenure.)
It's interesting to note that it took only nine years for the financial industry, freed from the constraints that had protected us for about 70 years, to destroy the economy.
Speaking as a guy who worked in those industries from 1975 to 2002, these people CANNOT be trusted. They MUST be regulated.
5
Clinton signed the bill he got from a Republican Congress, produced by Republican banking committees using drafts provided by Republican "think tanks." Remember that too. He was compromising with them, the same mistake Obama makes.
I agree he ought to have vetoed it and faced down the Republicans before the damage was done, but that does not absolve Republicans from their philosophy nor from what it brought us to under Bush.
I agree he ought to have vetoed it and faced down the Republicans before the damage was done, but that does not absolve Republicans from their philosophy nor from what it brought us to under Bush.
1
The sad part is that a failed economy hurts all including those who propagate the wrong policies.
No you can not make more money by depriving the poor of decent life. An expanding economy raises all boats including those of he hyper wealthy.
No you can not make more money by depriving the poor of decent life. An expanding economy raises all boats including those of he hyper wealthy.
1
The only reason things aren't as bad here is the NY Times. To me it always appears that other major reputable news organizations read the Times online early in the a.m. to determine their daily coverage - thus it has an outsized positive impact on our nation's world view. On the disinformation/propaganda side Murdoch owns many media outlets in Britain and Fox news here. That should explain handily why disinformation is rampant in Britain and growing here. If the destroyers ever get control of the Times, it's lights out for the future of the human race. The Times is the last major bulwark against mass insanity.
6
You're going to just leave us with that.....then - what is the whole story..
or what's your take on the story?
or what's your take on the story?
One definition of insanity is to do the same thing over and over again and expect a different outcome. Freud might argue that those who do such things suffer from repressed sexual desire. Religionist would hold up the Calvinistic view that man is inherently evil; therefore, it is the fault of the lower economic classes because they are obviously more evil or they wouldn't be poor. This comic turn of mind can underscore the notions which advance the positions of wealth and power of the right wing adherents. One ought to ask the moral question which is always completely avoided by the conservatives. How will their economic plans help the ordinary human beings over which they have control? Their usual answer is that the economy will right itself if the ordinary people suffer and pay the price to make the rich more prosperous. They disguise this sentiment under the cloak of national or international interest. Take the initial invasion into Iraq. We were told about WMD when, in fact, it was the OIL all along. Here in America they try to lead us to believe that it is a bad idea for ordinary people to have health insurance. They have repeatedly, over the years, argued against Social Security again and again. The simple idea is: If it helps people, it's bad because people are bad or they would get it for themselves. It's really a quite simple political philosophy. The rich are good. The poor are bad and those in-between can be hood-winked into supporting the rich.
4
The comments I've read blame Conservatives for spreading the misinformation and lies. How about blaming us Liberals for ineffectively promoting the correct version of political cause and effect. Yes, the Right has Fox News and Koch Brothers. But we have have MSNBC and Warren Buffet.
The real problem, in my opinion, is that politicians on the Right are obedient, compliant, and will repeat a party line even if it doesn't make sense. We Liberals think for ourselves. This creates a diversity that weakens our messaging.
The real problem, in my opinion, is that politicians on the Right are obedient, compliant, and will repeat a party line even if it doesn't make sense. We Liberals think for ourselves. This creates a diversity that weakens our messaging.
4
Warren Buffet would question the wisdom of continuously running huge government deficits.
1
If you think "we liberals" are independent-minded, I beg you to go read the early comments on the homepage story about Trans-Pacific Partnership. And there's just as much diversity in the intra-party warfare taking place within the GOP as there is inside the Democratic Party. But, indeed, I think it's almost indisputable that the GOP has the easier message to sell. Who could possibly be opposed to balancing the budget and personal responsibility? Except that the issues are much more complicated; but that matters not an iota. The reduction to the seemingly obvious and purportedly common-sensical is vastly easier on the Republican side. I shan't dispute that.
1
"absolve corporate interests and the wealthy from responsibility"
Since we in America have the best Congress money can buy, this is a MUST.
Since we in America have the best Congress money can buy, this is a MUST.
1
Your discussion of 'Bad Ideas' sounds very much like a definition of 'Wishful-Thinking'. And, pathetically, it has leaked out of the realm of economics into politics, overwhealming Very Gullible People, worldwide.
3
"Passenger trains here make rail service in the United States look good,"
Is Krugman serious? While certainly not amongst the best rail services in Europe, that in Britain is way ahead of that in the US in terms of frequency, speed, reach, quality of the rolling stock etc. although it is expensive. He needs to take Metro North (which has to be one of the most ridden systems in the country) out of NYC.
Is Krugman serious? While certainly not amongst the best rail services in Europe, that in Britain is way ahead of that in the US in terms of frequency, speed, reach, quality of the rolling stock etc. although it is expensive. He needs to take Metro North (which has to be one of the most ridden systems in the country) out of NYC.
2
I suspect Dr Krugman's experience of the UK rail network is limited to a standing room only rush hour commuter from London to Oxford.
1
Beware of true believers! How do you know when you are a true believer, when the prescription to what ails you is the same, no matter your disease. What you have in Britain is a religion, a moral truth. What you don't have is someone saying that we have a model that is a imperfect representation of the "thing" (economy) and within this context, here is the prescription, but it will change, because the economy will change and we will have to modify our models.
48
What do the UK & US need?
Well paying jobs.
If people are working, producing, and spending, we get a virtuous circle where the money they spend provides more decent jobs for other people. What do we need to provide these well paying jobs?
Well, gee, we need money, money in the private sector, money to pay for these jobs,
We must keep the change in the balance sheet of the private sector positive. More money must come into it than goes out. Where does money flow from and to?
There are two places. First, the federal government. When it spend, it adds money to the private sector. When it taxes, it takes money out. The deficit measures how much it puts in net. When we have a surplus, we take money out net. THE FEDERAL DEFICIT IS INCOME FOR PEOPLE, BUSINESSES, AND STATE AND LOCAL GOVERNMENTS.
The other place is our trade balance. When it is positive, money is put in the private sector; when it is negative, money is taken out.
The net effect of these two sectors must be positive. If we have a large trade balance, we only need a small deficit or can even support a surplus like Australia.
Today we have a large negative trade balance. We need a large deficit.
This is a simplification. There are matters I left out like if we ever have full employment or if we have shortages, we must cut back on spending or raise taxes to avoid inflation. Also federal spending must get the money to those who need it and will spend it, not those who do not need it and will speculate with it.
Well paying jobs.
If people are working, producing, and spending, we get a virtuous circle where the money they spend provides more decent jobs for other people. What do we need to provide these well paying jobs?
Well, gee, we need money, money in the private sector, money to pay for these jobs,
We must keep the change in the balance sheet of the private sector positive. More money must come into it than goes out. Where does money flow from and to?
There are two places. First, the federal government. When it spend, it adds money to the private sector. When it taxes, it takes money out. The deficit measures how much it puts in net. When we have a surplus, we take money out net. THE FEDERAL DEFICIT IS INCOME FOR PEOPLE, BUSINESSES, AND STATE AND LOCAL GOVERNMENTS.
The other place is our trade balance. When it is positive, money is put in the private sector; when it is negative, money is taken out.
The net effect of these two sectors must be positive. If we have a large trade balance, we only need a small deficit or can even support a surplus like Australia.
Today we have a large negative trade balance. We need a large deficit.
This is a simplification. There are matters I left out like if we ever have full employment or if we have shortages, we must cut back on spending or raise taxes to avoid inflation. Also federal spending must get the money to those who need it and will spend it, not those who do not need it and will speculate with it.
4
We don't live in the Age of Reason or even the Information Age anymore. This is the Age of Information Management. So it's common to find people believing idiot theories.
5
If you work for a company long enough or live in a country long enough you see all the same ideas coming up over and over again. The last company I working for I was there for about 20 years. Every few years the same ideas would come up. We would try them. Most were just ideas on how to push more cost off on customers. Once customer got wise we would have to move on to another rehashed idea to again fool the customers, of course it was wrapped in a pretty package. So it goes for government.
It use to be you had to wait for people to die to bring up the same old same old bad ideas again but not today. Today you have one of the greatest propaganda mills the world has ever seen. We no longer rely on Grandpa's tales we listen to TV and believe what we are told. Grandpa is just an old guy who probably has forgotten and is just making up stories. We believe that made up well coiffed sincere looking person on TV over Grandpa and our own memories.
This is why people believe ridiculous things like if you give the rich more money you will become better off financially. And how does that work? I always thought giving someone else more money made them richer and by general mathematical principles you poorer but by some magical thinking people actually fell for this. Some bunk about them investing in America or some other such nonsense as if more money in your hands couldn't or wouldn't be invested in America. I have news for you. You are America.
And Brits, ditto. You are Britain.
It use to be you had to wait for people to die to bring up the same old same old bad ideas again but not today. Today you have one of the greatest propaganda mills the world has ever seen. We no longer rely on Grandpa's tales we listen to TV and believe what we are told. Grandpa is just an old guy who probably has forgotten and is just making up stories. We believe that made up well coiffed sincere looking person on TV over Grandpa and our own memories.
This is why people believe ridiculous things like if you give the rich more money you will become better off financially. And how does that work? I always thought giving someone else more money made them richer and by general mathematical principles you poorer but by some magical thinking people actually fell for this. Some bunk about them investing in America or some other such nonsense as if more money in your hands couldn't or wouldn't be invested in America. I have news for you. You are America.
And Brits, ditto. You are Britain.
6
The Good Professor has been on the Persistence of Bad Ideas kick for a long time now, but today's column is right on the money. What is it about Britain and the US? Does it go back to the love match of Reagan and Thatcher? Do we really want to return to a Dickensian world?
First of all, Krugman has it right that most of what we are fed on a daily basis is sheer bunk, e.g., it's not that there aren't any jobs, it's that there's a skills gap -workers must up their game. The Republicans are masters at blaming the victims.
Then there are the Republican cries of "class warfare:" yes, there is, and the rich are winning. How about "redistribution?" There's that too, and it's all being redistributed upwards. Welfare cheats? They're all in corporate boardrooms.
Finally, there's the insistence that someone has to suffer, and you can bet it's not going to be the plutocrats. To add insult to injury, a speech on "moral hazard" is delivered along with the austerity cuts.
First of all, Krugman has it right that most of what we are fed on a daily basis is sheer bunk, e.g., it's not that there aren't any jobs, it's that there's a skills gap -workers must up their game. The Republicans are masters at blaming the victims.
Then there are the Republican cries of "class warfare:" yes, there is, and the rich are winning. How about "redistribution?" There's that too, and it's all being redistributed upwards. Welfare cheats? They're all in corporate boardrooms.
Finally, there's the insistence that someone has to suffer, and you can bet it's not going to be the plutocrats. To add insult to injury, a speech on "moral hazard" is delivered along with the austerity cuts.
7
If high speed passenger trains are such a wonderful idea then let private companies invest their own money in such projects. If these ventures are unprofitable then they are seriously bad ideas and taxpayer should not be forced to subsidize seriously bad ideas.
By the way Paul, did you ever consider the possibility that interest rates are low precisely because Mr. Osborne and others like him are not pursuing the tax and spend policies that you advocate?
By the way Paul, did you ever consider the possibility that interest rates are low precisely because Mr. Osborne and others like him are not pursuing the tax and spend policies that you advocate?
"If high speed passenger trains are such a wonderful idea then let private companies invest their own money in such projects."
You could have said that about the Eisenhower highway system, or the TVA, or rural electrification, or much else since the Erie Canal overcame the same arguments.
You could have said that about the Eisenhower highway system, or the TVA, or rural electrification, or much else since the Erie Canal overcame the same arguments.
2
Eric,
"then they are seriously bad ideas and taxpayer should not be forced to subsidize seriously bad ideas"
So I assume you don't support payouts to Boeing, Lockheed, Raytheon, Blackwater, Halliburton, or any other defense contractors, correct? Why continue to subsidize them if what we pay them for (i.e. the F-35) always run over budget and barely work.
What about oil companies? I assume that you think oil extraction is a seriously bad idea since it needs 10 billion a year in subsidies.
Big farms also get a pay out in the 10 billion a year range.
And then there's Wall St. They got bailed out to the tune of trillions. Surely, at the least, we should get rid of all their tax breaks, like the fact that capital gains are taxes 20% lower than real work?
And your favorite donors, the Kochs, were subsidized by Joseph Stalin and his communist blood money when their daddy made his riches building refineries for him. Surely you won't support any candidate who takes their subsidized Stalin cash, correct?
"then they are seriously bad ideas and taxpayer should not be forced to subsidize seriously bad ideas"
So I assume you don't support payouts to Boeing, Lockheed, Raytheon, Blackwater, Halliburton, or any other defense contractors, correct? Why continue to subsidize them if what we pay them for (i.e. the F-35) always run over budget and barely work.
What about oil companies? I assume that you think oil extraction is a seriously bad idea since it needs 10 billion a year in subsidies.
Big farms also get a pay out in the 10 billion a year range.
And then there's Wall St. They got bailed out to the tune of trillions. Surely, at the least, we should get rid of all their tax breaks, like the fact that capital gains are taxes 20% lower than real work?
And your favorite donors, the Kochs, were subsidized by Joseph Stalin and his communist blood money when their daddy made his riches building refineries for him. Surely you won't support any candidate who takes their subsidized Stalin cash, correct?
2
Eric, then why are high speed pasgr trains operating in other countries? Why is the transport and infrastructure kept better funded in 1st world nations but not US. Good transport develops the economy, bad transport the opposite. Under Gop Ike, our system of expressways was not a private profit deal.
Making every service a profit center is the path downward. The American middle class became the world's most secure decades ago, precisely due to govt action programs and spending. But this ended up profiting business greatly, even as they paid much higher taxes into the system. Now it's the opposite downward low tax spiral.
How do you think the middle class got educated? By high tuition, profit making universities?
Making every service a profit center is the path downward. The American middle class became the world's most secure decades ago, precisely due to govt action programs and spending. But this ended up profiting business greatly, even as they paid much higher taxes into the system. Now it's the opposite downward low tax spiral.
How do you think the middle class got educated? By high tuition, profit making universities?
2
The prevalence of seriously bad ideas is less surprising if you consider that large chunks of the UK media are owned by right wing billionaires. Rupert Murdoch owns the tabloid 'The Sun' and the quality newspaper 'The Times' which features the right wing Lord Rees-Mogg as one of its columnists. The very popular tabloid 'The Daily Mail' is even more right wing and is owned by Viscount Rothermere, who also has a large stake in the ITV television network.
Large chunks of the British media are therefore dedicated to pro-elite propaganda glued together with pictures of the Royal Family, media celebrities and topless models.
Large chunks of the British media are therefore dedicated to pro-elite propaganda glued together with pictures of the Royal Family, media celebrities and topless models.
6
Right wing billionaires don't own the press for the direct profits, because they don't make much money. Most are losing. So why are these smart billionaires buying up and holding all that media? Indirect profits of controlling the media.
1
I thought that the US electorate had a monopoly on ignorance and the Brits were the smart guys. All of the problems that exist on our planet is directly the result of politicians convincing the uneducated and uninformed masses to vote for them by bombarding the airwaves 24/7 with an agenda that actually works against the best interests of the masses. The USA and the rest of the industrialized world will eventually learn that different political systems cannot continue to prosper without a strong "campaign finance" policy which will level the playing field and result in a greater degree of fairness for the less fortunate among us. If not, our world will continue to evolve into a more dangerous society.
1
It's easy to be cynical about wingnut economics. Yes, it's transparently self-serving and often plainly goofy, but there's a remarkable (in the worst sense) naivete behind even the most self-evidently punitive spending cuts that isn't enough noted. The animating motive behind ALL of it is an imperative to return to a golden era of prosperity and comity that never existed (except in the fantasies of that handful of eastern European Jews who created Hollywood and gave the wingnuts the fodder for their false nostalgia in Andy Hardy movies and Shirley Temple musicals). The modern global economy reminds them every day that the white-picket-fence world that never existed--that they so vividly recall--exists nowhere. Rather than admit that sad fact and move to solve our most pressing problems, they enter into a state of mega-denial and double-think; Orwell's spinning corpse could power a dynamo. Climate change is a hoax; poor people don't want jobs; lower taxes on the wealthy means higher tax revenue; more guns means less crime; even--pace Mr. Orwell--more war means more peace; the list of palpably wrong things wingnuts fervently believe to be true seems to grow longer every day. Stalin could have only wished for such spectacular credulity. And all of it...ALL OF IT... can be traced back to a brand of wistful, wishful-thinking that the most stoned-out hippie would reject as too simple-minded.
3
Bookmanjb Munich -- I was with you on "a golden era of prosperity and comity that never existed" until you tried to blame that all on "that handful of eastern European Jews." Don't Germans ever learn?
1
As an American Jew living in Germany, some of whose family died in concentration camps, I direct you to an extremely informative book by another Jew (I believe), Neil Gabler, "An Empire of Their Own: How the Jews Invented Hollywood (1989)" After you read it, I hope your penchant for conclusion-jumping is somewhat attenuated.
Conservative politicians, here or in Britain, are more concerned with the bottom line than with the welfare of the people they govern. They can act with a certain degree of impunity because many of the voters are too dumb or uninformed to understand where their best interests lie. We have as much a voter problem as a politician problem.
1
I entirely agree, and will add that conservative politicians are essentially the paid employees of corporate power, and that corporate power is addicted to quarterly profits to keep investors invested thus, they have a disincentive to look far ahead.
1
This has been one of our major business problems dealing with the Japanese, Koreans, Chinese, etc. They culturally take a much longer view of profits and future gain. It works. We just won't do it. That is one of the basic lessons used by Warren Buffett, taking a much longer view than the rest of American business.
1
This reminds me of the Ptolemaic universe.
Philosophers started with two uncontrovertible truths: The earth is the center of the universe and the circle, as the perfect figure, must explain all planetary motion.
Since the actual universe didn't conform to this, they had to develop more and more elaborate schemes of cycles and epicycles in an attempt to explain the actual motion that was observed in the planets.
Philosophers started with two uncontrovertible truths: The earth is the center of the universe and the circle, as the perfect figure, must explain all planetary motion.
Since the actual universe didn't conform to this, they had to develop more and more elaborate schemes of cycles and epicycles in an attempt to explain the actual motion that was observed in the planets.
2
Is it at all possible that Britain's news media - like very well trained geese - are giving voice only to the ideology of the biggest media owner, Rupert Murdoch?
3
When will the Tea Party finally reject the British ideas like the real Tea Party did back in the day?
1
The hard times eventually get better, 'proving' that the self-inflicted pain was effective. In a democracy the voters may not be quite capable of punishing themselves. Instead they heroically sacrifice their children. Way to go, Brits!
PK's argument is right, almost by default. Social programs are a natural target of the greedy, whether in the UK or the USA. There is a punitive "serves-you-right" attitude that ignores long-term consequences. This is worth repeating, although many minds are shut tight. Like mussels or clams, only one thing will open them to a new tide, and then it's too late.
The Brit media did sell the notion that the Labour dog would be wagged by the Scottish tail. Indisputable. Also a fact, large swathes of influential Brit media, TV and newspapers, are owned by Murdoch. Same owner as Fox, same tactics.
But Scottish voters didn't vote as they did because of that propaganda. They voted nationalistically, and rejected London-centered parties. The old Liberals, Lib-Dems now, retain only one seat in Scotland. There too, Labour lost one of its major bases and for the same reasons. Furthermore UKIP denied Labour votes in northern England. The Tories won because they held their base while all else was shifting around them.
The Brit media did sell the notion that the Labour dog would be wagged by the Scottish tail. Indisputable. Also a fact, large swathes of influential Brit media, TV and newspapers, are owned by Murdoch. Same owner as Fox, same tactics.
But Scottish voters didn't vote as they did because of that propaganda. They voted nationalistically, and rejected London-centered parties. The old Liberals, Lib-Dems now, retain only one seat in Scotland. There too, Labour lost one of its major bases and for the same reasons. Furthermore UKIP denied Labour votes in northern England. The Tories won because they held their base while all else was shifting around them.
Reagan-Thatcherism persists in the U.S. and Britain. It was Maggie Thatcher who said, "There is no such thing as society." Translation: democratic Liberal/Labour support for everyday working people and the poor and vulnerable is out; every effort made by the conservative regime to reverse course from the Depression-WW II era & dismantle government expenditures for society and its people in favor of government generosity & welfare for business and the rich
Conservatives do not need to be accurate or correct in their economic, social, & political analyses and arguments. They only need to persuade a sufficient share the citizenry they have THE answers to society's problems, so "trust us"; "we know what is best"
How did they do it? By taking control of the culture--essentially both side of the Atlantic have been Murdoched by creating a masterful, manipulative media that sells conservatism 24/7. All they needed to do was assess the political psychology of the electorate, and selectively feature bits of information and propaganda that resonate with cultural values--for better and worse.
Example:
Goal: Get rid of support for the poor and vulnerable. Make cultural message resonate with self-sufficiency, survival of the fittest, "stiff upper lip," and "mustn't grumble" by casting those in need as losers, Takers, and moochers. Blame the victims. And so it went...
Why did it work? As Krugman said, no effective counterarguments from wimpy Democrats and Labour. Why NOT?
Conservatives do not need to be accurate or correct in their economic, social, & political analyses and arguments. They only need to persuade a sufficient share the citizenry they have THE answers to society's problems, so "trust us"; "we know what is best"
How did they do it? By taking control of the culture--essentially both side of the Atlantic have been Murdoched by creating a masterful, manipulative media that sells conservatism 24/7. All they needed to do was assess the political psychology of the electorate, and selectively feature bits of information and propaganda that resonate with cultural values--for better and worse.
Example:
Goal: Get rid of support for the poor and vulnerable. Make cultural message resonate with self-sufficiency, survival of the fittest, "stiff upper lip," and "mustn't grumble" by casting those in need as losers, Takers, and moochers. Blame the victims. And so it went...
Why did it work? As Krugman said, no effective counterarguments from wimpy Democrats and Labour. Why NOT?
3
You're beating a dead horse, Dr. K. These people aren't going to change, as you, yourself, acknowledge. They are "true believers," in Eric Hoffer's sense. For them, these are core, philosophical beliefs, not economic ones.
For conservative politicians on both sides of the pond, they're also part of a political strategy that has worked very well for them. They have no incentive to change.
Further, you can't, all by yourself, fight the massive, well-oiled, conservative propaganda machine. If you want to change the public discourse, if you want to influence all those swayed by such propaganda, there's no other choice but to reframe the terms of debate.
Hillary Clinton did just that recently, when she called for universal, automatic voter registration. It is an idea that has already caught on in several states, and it has put conservatives on the defensive.
A comparable idea in the economic realm, is public investment. Talk about the benefits of investment – in infrastructure, education, research, renewable energy, and so on – how it can make this country competitive again, how it can get the economy off the dime and moving again, and how it will pay for itself with increased tax revenues.
For conservative politicians on both sides of the pond, they're also part of a political strategy that has worked very well for them. They have no incentive to change.
Further, you can't, all by yourself, fight the massive, well-oiled, conservative propaganda machine. If you want to change the public discourse, if you want to influence all those swayed by such propaganda, there's no other choice but to reframe the terms of debate.
Hillary Clinton did just that recently, when she called for universal, automatic voter registration. It is an idea that has already caught on in several states, and it has put conservatives on the defensive.
A comparable idea in the economic realm, is public investment. Talk about the benefits of investment – in infrastructure, education, research, renewable energy, and so on – how it can make this country competitive again, how it can get the economy off the dime and moving again, and how it will pay for itself with increased tax revenues.
3
How can one justify injustice and excuse the inexcusable when the “facts” either do not exist or are lies? The rich and powerful historically have relied on faith and prejudice, different sides of the same psychology, in that neither requires facts to support belief. Trouble and misfortune flows down to the poor, the non-white, the weak the unlucky and in this country with Republicans, women.
Thus women are paid less for the same work because women get married and have babies and are weak and inferior to men. This is an excuse for prejudice against women. Blacks are lazy and may not show up, so hiring whites only is justified,
These bad ideas of which there are many in England and here invite voters to join in and exercise their prejudices against one another, so that people are caused to distrust those whose interests are exactly the same as their own. Working people in Wisconsin who belong to a union elect a government that destroys collective bargaining for public employees although it is clear that all unions are targeted their own included.
Here is the oldest bad idea. The wealthy who pay a lot of taxes and create the jobs are entitled to govern because they are smarter and superior and – entitled. In a life as a trial lawyer I learned that disproving a lie supported by a number of liars is very difficult and the party who tells the greatest number of convincing lies usually wins.
Thus women are paid less for the same work because women get married and have babies and are weak and inferior to men. This is an excuse for prejudice against women. Blacks are lazy and may not show up, so hiring whites only is justified,
These bad ideas of which there are many in England and here invite voters to join in and exercise their prejudices against one another, so that people are caused to distrust those whose interests are exactly the same as their own. Working people in Wisconsin who belong to a union elect a government that destroys collective bargaining for public employees although it is clear that all unions are targeted their own included.
Here is the oldest bad idea. The wealthy who pay a lot of taxes and create the jobs are entitled to govern because they are smarter and superior and – entitled. In a life as a trial lawyer I learned that disproving a lie supported by a number of liars is very difficult and the party who tells the greatest number of convincing lies usually wins.
3
We know went went wrong. Financial instituions were not regulated. Then we learned Bankers never go to jail. Then we learned G7 economies were turned over to Central Bankers to manage. Then my generation learned, interest on our savings for retirement were taken away from us. As Krugman writes, we wait for all the rationalizations of a return to normal, which never will happen, as there is no normal. Economist are of no help, as their profession of chasing yeterday's charts and graphs doesn't work anymore.
4
This British Conservative blueprint for slashing the social safety net, blaming unemployed workers for their own demise while cutting Corporate tax rates to the bone & attracting foreign investment on the backs of the working poor English citizens is despicable. It is reminiscent of our Republican party who are big on fruitful ideas from the bible, yet sadly deficient when it comes to governing their own country.
It reminds me a tad of Brigham Young's attitudes while building the Kingdom of God on Earth in the Southwest. While believing in polygamy, his policies & beliefs always seemed to strengthen White Mormons at the expense of people of color. In 1863, Young stated "Shall I tell you the law of God in regard to the African race? If the white man who belongs to the chosen seed mixes his blood with the seed of Cain, the penalty, under the law of God, is death on the spot."
While referring to himself as the Moses of America, Brigham Young claimed that indigenous people were the Laminites that Jesus preached to during his resurrection on Earth (seriously!) Although their special place was just lip service, as the LDS Church took all of their best land w/o payment, excluded them from Mormon settlements, sought to convert them to Christianity & advocated the death penalty for any Indians caught stealing or trespassing on Mormon land. Brigham Young persuaded Washington DC to extinguish Indian land titles in Utah & Nevada, while relocating them to Reservations on barren lands.
It reminds me a tad of Brigham Young's attitudes while building the Kingdom of God on Earth in the Southwest. While believing in polygamy, his policies & beliefs always seemed to strengthen White Mormons at the expense of people of color. In 1863, Young stated "Shall I tell you the law of God in regard to the African race? If the white man who belongs to the chosen seed mixes his blood with the seed of Cain, the penalty, under the law of God, is death on the spot."
While referring to himself as the Moses of America, Brigham Young claimed that indigenous people were the Laminites that Jesus preached to during his resurrection on Earth (seriously!) Although their special place was just lip service, as the LDS Church took all of their best land w/o payment, excluded them from Mormon settlements, sought to convert them to Christianity & advocated the death penalty for any Indians caught stealing or trespassing on Mormon land. Brigham Young persuaded Washington DC to extinguish Indian land titles in Utah & Nevada, while relocating them to Reservations on barren lands.
6
You are not the first to notice a similarity between the preaching of the Tory government and the impact organised religion has had on society since the Middle Ages. Both led by the rich, using lies and prejudice to force us into certain unnatural behaviours; whether that's abstaining from sex (religion) to working ever longer hours away from our friends and family (Tories), to believing in the inferiority of women (religion) or the ingratitude and inferiority of the poor (Tories). Both led by strong dogma with no rational or truthful basis other than the aim of bringing about the confirmity of the masses so that the elite can extract from them to enrich themselves.
5
While it is true that the Conservatives successful tarred Labour with the profligate smear, it looks fairly clear that a decisive factor in their victory was creating the fear among the electorate that a minority Labour Government would be at the mercy of the Scottish National Party anarchists.
Given the fact that the SNP won the large number of 56 seats in the House of Commons, this fear turned out to be well founded.
Given the fact that the SNP won the large number of 56 seats in the House of Commons, this fear turned out to be well founded.
2
We're living in a precision mash-up of Animal Farm, 1984, and Brave New World. When I read those great works in school I thought what a strange, unrealistic, downright nightmarish scenario they depicted. Little did I know that those brilliant writers would prove prescient, and in my own lifetime. When fiction becomes truth, and truth so much fiction, watch out. Toss in a little Ayn Rand for good measure and the fix is in. It's no wonder the extremely wealthy are exploring space travel. They know full well that they are trashing this place, they just don't care.
10
Facts become inconvenient when they run counter to one's own position.
1
No, Paul, You are wrong again.
Big fat overbearing bloated government is the problem not the solution to our problems. The Department of Education has helped create a student debt time bomb. HUD and FANNI MAE helped create a subprime mortgage crisis. Etc. Etc. Etc. Furthermore, government should be pushed down to the state and local levels which cannot just print money to pay expenses.
Big fat overbearing bloated government is the problem not the solution to our problems. The Department of Education has helped create a student debt time bomb. HUD and FANNI MAE helped create a subprime mortgage crisis. Etc. Etc. Etc. Furthermore, government should be pushed down to the state and local levels which cannot just print money to pay expenses.
2
We must fix government, not do away with. Proposals to reduce its size and reach are the same arguments made by the Republicans in the first part of the 19th century.
1
The conservatives are like the ad men in Mad Men who dreamed up ad campaigns to sell everything from cigarettes to whatever. Remember the episode when the lead ad director comes up with the line for Lucky Strike cigarettes, "It's Toasted." "It's Toasted to taste even better . . . So light up a Lucky, the better tasting cigarette." So, substitute any idea conservatives have with cigarette advertising. Maybe all of the ad execs are working for the GOP. See this for cigarette advertising:
http://www.chickenhead.com/truth/lucky2.html
http://www.chickenhead.com/truth/lucky2.html
2
The Koch brothers intend to spend millions on the candidate of their choice. There are other billionaires who will likely spend on that candidate as well. Do you think they will be spending their money promoting government spending? I think the message in our country in 2016 will mirror the message in Britain's recent election and we, too, will be mulling over MANY seriously bad ideas.
1
The reason why the bad ideas don't die is the same reason they came about in the first place - serve the interests of big money.
If you stop pretending we live in a representative democracy but instead in a full blown plutocracy that exists only to serve big money, it all starts to make perfect sense.
If you stop pretending we live in a representative democracy but instead in a full blown plutocracy that exists only to serve big money, it all starts to make perfect sense.
13
Thank you, Dr. Krugman, for identifying the Seriously Bad Ideas/Have The
Little People Pay The Price syndrome.
Little People Pay The Price syndrome.
5
When politics becomes economics,it is a total disaster.History since 1929 'The Great Depression' testifies it.It is not only confined to Britain or Europe.This scenario is all over,developing or developed countries ever since the World has ben gripped with 'Conservatism',free market economy or globalisation.Their direct impact have been 'billionaire class' complete command over political power.
Of course,the demise of the Soviet Union has helped to cement 'billionaires class' hold of political power globally.
Consequently,inadequately regulated financial institutions and perpetuation of wrongheaded austerity agenda ( though to a lesser extent in US;thanks to Obama and Fed Res ) are dominant.Since the news media are controlled by corporations the 'bad' ideas are easily propogated as 'good' ideas and people tempts to be convinced.
Recent Conservative election triumph in Britain is one such glaring instance where news media advanced that excessive government spending under Labour caused the financial crisis.
The EU have made the Greek crisis worse since 2010 by imposing senseless austerity inflicting worst suffering on individuals.Greek responded against it and brought Syriza ( left party) to power by people mandate.The Greek crisis continues with impasse of further cut the already reduced pension benefits to retirees.
A silver lining seems appearing in Bernie Sanders bid questioning 'billionaire class' influence in the US Presidential race.
If Sanders even partially succeeds?
Of course,the demise of the Soviet Union has helped to cement 'billionaires class' hold of political power globally.
Consequently,inadequately regulated financial institutions and perpetuation of wrongheaded austerity agenda ( though to a lesser extent in US;thanks to Obama and Fed Res ) are dominant.Since the news media are controlled by corporations the 'bad' ideas are easily propogated as 'good' ideas and people tempts to be convinced.
Recent Conservative election triumph in Britain is one such glaring instance where news media advanced that excessive government spending under Labour caused the financial crisis.
The EU have made the Greek crisis worse since 2010 by imposing senseless austerity inflicting worst suffering on individuals.Greek responded against it and brought Syriza ( left party) to power by people mandate.The Greek crisis continues with impasse of further cut the already reduced pension benefits to retirees.
A silver lining seems appearing in Bernie Sanders bid questioning 'billionaire class' influence in the US Presidential race.
If Sanders even partially succeeds?
11
Anything that "rules", like seriously bad ideas or seriously stupid people is wrong.
1
So the Conservatives won the election in an unexpected landslide because the voter was duped by the British media? Seriously Paul, that is the best you can do?
4
Actually UK Conservatives won 51% of the seats with 37% of the votes, thanks to the winner take all system. The old Labour vote was split between Labour and the more left SNP, but 63% of Britons rejected the Conservatives and are not happy.
For England PK advocates infrastructure spending and robust social programs financed by government borrowing. This would certainly have an immediate beneficial effect on the level of economic activity, and if it does produce a lasting improvement, GDP will increase, tax revenues will go up, the deficit will disappear and debt levels will reduce. But what will happen if this action does not produce a lasting improvement in the economy? What happens if there is a downturn? Will the government have the reserve to respond to another unexpected financial crisis, or a military requirement, or a need for another stimulus package? Will it lead to a need to reduce social programs and infrastructure programs below their current levels?
In other words, there is risk in this, for people at all economic levels, and it is a risk that not everyone is willing to take, and if it is done it has to be done well and with prudence.
In other words, there is risk in this, for people at all economic levels, and it is a risk that not everyone is willing to take, and if it is done it has to be done well and with prudence.
12
The UK government can print money. It will run out money the day after the English Football League runs out of points. The only limit on the UK (& the US) printing of money is inflation.
3
The risk you are talking about is inflation, not national bankruptcy. Let me explain why: The UK issues its own sovereign fiat currency. If the UK needs to repay its borrowers (or chooses to skip borrowing entirely), it can just create money out of thin air. This eliminates the risk of bankruptcy, but creates the risk of too much money competing for too few goods and services, which causes prices to be bid up. Inflation.
But now think about the problem we face today; there are productive resources sitting around idle, because no one wants to buy them. How is inflation supposed to happen under these conditions? It can't and it won't happen. That is why it is essentially FREE for governments to 'borrow' during economic downturns. The product of this public employment of idle resources could be additional leisure for citizens, more education, and renewed infrastructure. All, essentially, FREE.
And then, during boom years, the government is supposed to pull back on spending and collect taxes to pay down the debt. Not because debt is bad, but because doing so takes money out of the economy, stops the gov't from bidding up prices, and forces capital to seek its most productive employment in the private sector.
What I've described is basic macroeconomics, and it's extremely frustrating for people like PK to deal with a political system that acts like this hasn't been well understood for almost a century. Inflation paranoia = pure waste.
But now think about the problem we face today; there are productive resources sitting around idle, because no one wants to buy them. How is inflation supposed to happen under these conditions? It can't and it won't happen. That is why it is essentially FREE for governments to 'borrow' during economic downturns. The product of this public employment of idle resources could be additional leisure for citizens, more education, and renewed infrastructure. All, essentially, FREE.
And then, during boom years, the government is supposed to pull back on spending and collect taxes to pay down the debt. Not because debt is bad, but because doing so takes money out of the economy, stops the gov't from bidding up prices, and forces capital to seek its most productive employment in the private sector.
What I've described is basic macroeconomics, and it's extremely frustrating for people like PK to deal with a political system that acts like this hasn't been well understood for almost a century. Inflation paranoia = pure waste.
1
Sam, I agree with most of what you say, but not about the paragraph about boom years. Just look at the record.
The US federal government has balanced the budget, eliminated deficits for more than three years in just six periods since 1776, bringing in enough revenue to cover all of its spending during 1817-21, 1823-36, 1852-57, 1867-73, 1880-93, and 1920-30 (all boom years). The debt was paid down 29%. 100%, 59%, 27%, 57%, and 36% respectively. A depression began in 1819, 1837, 1857, 1873, 1893 and 1929. Using the usual def of depression, this accounts for ALL of our depression.
Are you sure you want to pay down the debt?
I think what you are missing is that as the economy grows, it always needs new money. One can conceive of such a situation as you envisage, but it never seems to happen--at least since WWI. All periods of excessive inflation were caused by shortages, even Weimar.
The US federal government has balanced the budget, eliminated deficits for more than three years in just six periods since 1776, bringing in enough revenue to cover all of its spending during 1817-21, 1823-36, 1852-57, 1867-73, 1880-93, and 1920-30 (all boom years). The debt was paid down 29%. 100%, 59%, 27%, 57%, and 36% respectively. A depression began in 1819, 1837, 1857, 1873, 1893 and 1929. Using the usual def of depression, this accounts for ALL of our depression.
Are you sure you want to pay down the debt?
I think what you are missing is that as the economy grows, it always needs new money. One can conceive of such a situation as you envisage, but it never seems to happen--at least since WWI. All periods of excessive inflation were caused by shortages, even Weimar.
2
Paul's repetition shows he's locked in a losing narrative, despite have math, history, theory, and experience at his side. In the broader world, he overlooks power, preferring to discuss policy and number targets.
We get that these are important and guide growth away from wealth; we know a wide swath of public voices oppose Paul's ideas for reasons other than errors--including readers who swart away at elements of his logic and reason. We get that.
I agree with his numbers; link FRED graphs to news sites and jobs are returning but pathways are closing; promotions, despite fast foods, no longer exist. Power is closing off the paths.
The Right is writing new history. Its old alliances are reformed. Its decisions are money and people-driven, not by ideology or its illusions. The Right also has a social agenda. They are using income and public services--wealth and wage inequity--to shift standards for schools and civil liberties.
Peak around the lies about inflation, debt, services and their balance sheets. Visible is the trammeling of women and voting rights, safety nets.
Power seeking by any means is what we are witnessing, long and short term. Policy is being set up to be used--and is being used!--as a tool of power not social progress.
We get that these are important and guide growth away from wealth; we know a wide swath of public voices oppose Paul's ideas for reasons other than errors--including readers who swart away at elements of his logic and reason. We get that.
I agree with his numbers; link FRED graphs to news sites and jobs are returning but pathways are closing; promotions, despite fast foods, no longer exist. Power is closing off the paths.
The Right is writing new history. Its old alliances are reformed. Its decisions are money and people-driven, not by ideology or its illusions. The Right also has a social agenda. They are using income and public services--wealth and wage inequity--to shift standards for schools and civil liberties.
Peak around the lies about inflation, debt, services and their balance sheets. Visible is the trammeling of women and voting rights, safety nets.
Power seeking by any means is what we are witnessing, long and short term. Policy is being set up to be used--and is being used!--as a tool of power not social progress.
5
Mr Krugman is so dead on point until he comes to his final conclusion "that bad ideas rule the world." This is a modern monetary economy, and the freedom from social bonds created by the social technology money, has brought not the promised freedom implicit in monetization, but corruption so significant that bad ideas can easily be purchased from Economists ON THE MAKE by any political persuasion which wishes to pay them richly for rancid notions. When a sycophant of Mammon is found out among the ranks of the Economist fold, I would imagine that his hope is to ring fence the property he resides on because he wouldn't ring fence risk when it was his obligation to do so, or even better move to an island to escape the wrath of the fellow citizens whom his bilge has betrayed.
Money has become everything, and ironically that was never its purpose! It was supposed to facilitate good ideas which had been tested and retested inductively and checked deductively for the benefit of great ideas in the Saga of Man.
We currently live in a bizarro world of derivatives and the rehypothecation of paper because like Ferdinand and Isabella who mistook gold for value, we have been misled to believe that in the paper alchemy of financiers, who electronically create wealth from paper, the power of Western Economies will be released. Will that happen? No! We live in a Mania every bit the equivalent of the Tulip Mania largely because Economists have failed us, and not ideas.
Money has become everything, and ironically that was never its purpose! It was supposed to facilitate good ideas which had been tested and retested inductively and checked deductively for the benefit of great ideas in the Saga of Man.
We currently live in a bizarro world of derivatives and the rehypothecation of paper because like Ferdinand and Isabella who mistook gold for value, we have been misled to believe that in the paper alchemy of financiers, who electronically create wealth from paper, the power of Western Economies will be released. Will that happen? No! We live in a Mania every bit the equivalent of the Tulip Mania largely because Economists have failed us, and not ideas.
1
You're coming at this from the wrong angle. Predictions of runaway inflation are made for the benefit of wealthy benefactors, not macroeconomic modeling. If the government prioritizes low inflation over high employment, the beneficiaries are those holding financial securities who are decidedly more wealthy than a working class Joe.
3
The reason seriously bad ideas won't go away is because they aren't actually intended to solve the problems they are allegedly aimed at. What they really do is perpetuate power in the hands of those who use them for that purpose. What we are seeing here is classic authoritarian governance at work. Economics can't fully unravel it, but the psychology of authoritarian leaders and followers explains much.
For leaders, the high social dominance personalities described in the ground breaking work of Professor Bob Altimeter, it's all about maintaining their authority. As an electoral strategy it seems to have been very effective - they won after all.
They get power and give their followers what they want: strong leaders who can 'protect' them, scapegoats for their problems, and a simple narrative to explain a complex and frightening world. The leaders don't actually have to solve problems as long as their followers believe what they're being told - and they only believe what their leaders tell them. It's a bubble universe, and facts need not apply.
The failure of the press to burst this bubble is not hard to explain - follow the money. Remember the recent scandals about Rupert Murdoch's press empire, and how many politicians of all parties were in bed with it? Look at the right wing media machine in the U.S. and the role they play in catapulting the propaganda.
The reason bad ideas won't die is because they're very useful - for those who would rule us.
For leaders, the high social dominance personalities described in the ground breaking work of Professor Bob Altimeter, it's all about maintaining their authority. As an electoral strategy it seems to have been very effective - they won after all.
They get power and give their followers what they want: strong leaders who can 'protect' them, scapegoats for their problems, and a simple narrative to explain a complex and frightening world. The leaders don't actually have to solve problems as long as their followers believe what they're being told - and they only believe what their leaders tell them. It's a bubble universe, and facts need not apply.
The failure of the press to burst this bubble is not hard to explain - follow the money. Remember the recent scandals about Rupert Murdoch's press empire, and how many politicians of all parties were in bed with it? Look at the right wing media machine in the U.S. and the role they play in catapulting the propaganda.
The reason bad ideas won't die is because they're very useful - for those who would rule us.
5
Oops, make that Professor Bob Altemeyer, whose work on authoritarians should be a must read for anyone concerned about politics.
http://home.cc.umanitoba.ca/~altemey/
His work greatly influenced John Dean's "Conservatives Without Conscience".
http://home.cc.umanitoba.ca/~altemey/
His work greatly influenced John Dean's "Conservatives Without Conscience".
1
Yes, Altemeyer on Authoritarians is a must read. I would recommend also Reid Meloy and Robert Hare on psychopaths. There are powerful behavioral parallels between psychopaths and authoritarians. Taken together they explain zombie ideas and abusive plutocracies.
Keep in mind too that, insanely enough, corporations, humanity's most powerful economic institutions, are largely run according to psychopathic values. Psychopathic values are the very definition of failure, but they channel wealth to the few in power, so like the zombie ideas they run on, they keep coming back.
Keep in mind too that, insanely enough, corporations, humanity's most powerful economic institutions, are largely run according to psychopathic values. Psychopathic values are the very definition of failure, but they channel wealth to the few in power, so like the zombie ideas they run on, they keep coming back.
In the US we have a simple problem, trickle down economics is a failure and getting worse. The problem is that conservatives cling to their outdated idea and refuse to change in the face of facts and evidence. Somehow, in our conservative red states, the rallying cry of jobs, jobs, jobs was missing from the mid term campaigns and electioneering and grows fainter by the year, simply because the jobs, jobs, jobs have not materialized after the tax cuts.
8
Krugman has it completely wrong by stating that it was a lack of regulation ( government) allowed the financial industry to cause the economic disaster. More likely it was unintended consequences of government policy that caused the economic collapse and has continued to impart the recovery. Do banks, left to their own decision process, ever loan money to people or companies if they believe it will not be repaid? Anybody trying to get a loan can answer this with a resounding "NO". Can a new family today buy a house, a car and live on a single middle class income? Again a resounding "NO". The point being that government policy caused the economic crash and continued interference has prevented the recovery. Inflation has wrecked the ability of a family to exist as it did in the 60s, 70s and 80s. Obamacare, touted by Krugman, is a disaster and he refuses to admit its failure. It's costs are 20% below projections and this sounds great, until you realize that there are 30% less enrollees than projected. The state exchanges are closing and the insurance cost rises are budget busting. Then there is the little detail that poorer folks cannot afford the deductibles so they might have insurance, but don't have medical care. Of course Krugman knows it is a disaster, but since he really wanted single payer he decided to back this plan, have it fall apart and then declare we must have a totally socialized system. Krugman just won't admit he is wrong.
1
And sorry to say - but one of the worst Ideas of seriously Bad Ideas might have been this:
'The real divide between currently successful economies, like the U.S., and currently troubled ones, like Germany, is not political but philosophical; it's not Karl Marx vs. Adam Smith, it's Immanuel Kant's categorical imperative vs. William James' pragmatism. What the Germans really want is a clear set of principles: rules that specify the nature of truth, the basis of morality, when shops will be open, and what a Deutsche mark is worth. Americans, by contrast, are philosophically and personally sloppy: They go with whatever seems more or less to work. If people want to go shopping at 11 P.M., that's okay; if a dollar is sometimes worth 80 yen, sometimes 150, that's also okay.
Now, the American way doesn't always work better. Even today, Detroit can't or won't make luxury cars to German standards; Amtrak can't or won't provide the precision scheduling that Germans take for granted. America remains remarkably bad at exporting; the sheer quality of some German products, the virtuosity of German engineering, have allowed the country to remain a powerful exporter despite having the world's highest labor costs. And Germany did a better job of resisting the inflationary pressures of the '70s and '80s than we did.
But the world has changed in a way that seems to favor flexibility over discipline. With technology and markets in flux, not everything worth doing is worth doing well.
'The real divide between currently successful economies, like the U.S., and currently troubled ones, like Germany, is not political but philosophical; it's not Karl Marx vs. Adam Smith, it's Immanuel Kant's categorical imperative vs. William James' pragmatism. What the Germans really want is a clear set of principles: rules that specify the nature of truth, the basis of morality, when shops will be open, and what a Deutsche mark is worth. Americans, by contrast, are philosophically and personally sloppy: They go with whatever seems more or less to work. If people want to go shopping at 11 P.M., that's okay; if a dollar is sometimes worth 80 yen, sometimes 150, that's also okay.
Now, the American way doesn't always work better. Even today, Detroit can't or won't make luxury cars to German standards; Amtrak can't or won't provide the precision scheduling that Germans take for granted. America remains remarkably bad at exporting; the sheer quality of some German products, the virtuosity of German engineering, have allowed the country to remain a powerful exporter despite having the world's highest labor costs. And Germany did a better job of resisting the inflationary pressures of the '70s and '80s than we did.
But the world has changed in a way that seems to favor flexibility over discipline. With technology and markets in flux, not everything worth doing is worth doing well.
4
- and ironiously the above might be the most well written and most clever propaganda piece for Germans Economical System - which is 'totally' based on: 'Everything worth doing is worth doing well'.
And that's a shame as the Economical System of the US or better Italy from an 'emotional' standpoint is far superior.
But as we are living in a post-postmodern world of 'Total Finance' - the worst Idea of all bad Idea is to let 'Total Finance' rule without 'a clear set of principles: rules that specify the nature of truth, the basis of morality,'
And that's a shame as the Economical System of the US or better Italy from an 'emotional' standpoint is far superior.
But as we are living in a post-postmodern world of 'Total Finance' - the worst Idea of all bad Idea is to let 'Total Finance' rule without 'a clear set of principles: rules that specify the nature of truth, the basis of morality,'
1
Mr. Osborne, and many others, might do well to read: Leakage: The Bleeding of the American Economy by Treval C. Powers. As summarized in this article by George Brockway (http://wp.me/p2r2YP-iQ) Powers' study of over 100 years of the Statistical Abstract of the United States, shows:
* "Virtually every transient feature of economic behavior is a consequence of decisions and actions of persons in control of public economic policy."
* "Irregularities of performance are related to maldistribution of income."
* "Because they believe that the progress of the GNP over a period of several years reveals the growth capacity of the nation, economists generally underestimate the actual capacity."
* "Monetary restraint had no remedial effect on inflation; on the contrary, it always raised the price level."
* "Growth never required a relative increase of investment."
* "There is no connection between employment and monetary sta"
Deficit spending without appropriate taxation is "a way of transferring income from the general population to the wealthiest minority of it."
Osborne and the rest of the Supply Side acolytes are 180 degrees from evidence and reason.
* "Virtually every transient feature of economic behavior is a consequence of decisions and actions of persons in control of public economic policy."
* "Irregularities of performance are related to maldistribution of income."
* "Because they believe that the progress of the GNP over a period of several years reveals the growth capacity of the nation, economists generally underestimate the actual capacity."
* "Monetary restraint had no remedial effect on inflation; on the contrary, it always raised the price level."
* "Growth never required a relative increase of investment."
* "There is no connection between employment and monetary sta"
Deficit spending without appropriate taxation is "a way of transferring income from the general population to the wealthiest minority of it."
Osborne and the rest of the Supply Side acolytes are 180 degrees from evidence and reason.
6
Paul, the 'success' of really bad ideas only emphasizes the importance of political messaging.
Conservatives are good at one thing, and one thing only - message discipline. They stick to it thick and thin, though fair and foul weather. And their consistency ultimately pays off, as witnessed by the staying power of zombie ideas.
In contrast, contemporary liberals, especially those in the DLC-Obama-Blair Labor mold, appear more concerned with "winning" than message consistency and discipline. They trot out ideas, poll test them for public resonance, and if they don't immediately catch fire, drop them like a hot potato, and move on to something else.
The secret to ingraining both good and bad habits in human beings comes down to a single word: repetition. Conservatives understand this, and retain their message discipline over multiple elections, even decades - especially here in America, where no matter the problem, the Republican solution is always to cut taxes, further decimate the safety net, and restrict a woman's access to abortion.
Liberals must learn this lesson. Polling reflects nothing more than a blip in time. You can lose a battle in the war of political messaging and still triumph in the larger war - even if your idea is ultimately nuttier than a fruitcake and completely off base.
The only remedy for seriously bad ideas is the forceful advocacy for seriously good ideas - over and over, over multiple elections cycles, until they finally win out.
Conservatives are good at one thing, and one thing only - message discipline. They stick to it thick and thin, though fair and foul weather. And their consistency ultimately pays off, as witnessed by the staying power of zombie ideas.
In contrast, contemporary liberals, especially those in the DLC-Obama-Blair Labor mold, appear more concerned with "winning" than message consistency and discipline. They trot out ideas, poll test them for public resonance, and if they don't immediately catch fire, drop them like a hot potato, and move on to something else.
The secret to ingraining both good and bad habits in human beings comes down to a single word: repetition. Conservatives understand this, and retain their message discipline over multiple elections, even decades - especially here in America, where no matter the problem, the Republican solution is always to cut taxes, further decimate the safety net, and restrict a woman's access to abortion.
Liberals must learn this lesson. Polling reflects nothing more than a blip in time. You can lose a battle in the war of political messaging and still triumph in the larger war - even if your idea is ultimately nuttier than a fruitcake and completely off base.
The only remedy for seriously bad ideas is the forceful advocacy for seriously good ideas - over and over, over multiple elections cycles, until they finally win out.
15
Do polls reflect the norms that are set by Gop continual messaging in the media? So that liberal ideas that would benefit the majority seem too left wing, so the media doesn't even discuss it?
Then the Dems use those polls to set up how they will react and what they will propose. Always with an eye on political donors of the big money. In our system without public financing and no limits on big money, how could it be otherwise? Having only 2 parties makes it so convenient.
That's how the country moved rightward, with Dems, who are supposed to defend working people, having Wall St in their cabinets, And pushing Republican type major policies like financial deregulation and a health care system that leaves millions out while subsidizing medical industry profits.
Then this is called great progress by Krugman, when he should be fighting
for specific financial regulations of decades ago, and for a 1st rate h/c system with costs negotiated by govt with corporations like most other 1st world countries have had for some time.
Then the Dems use those polls to set up how they will react and what they will propose. Always with an eye on political donors of the big money. In our system without public financing and no limits on big money, how could it be otherwise? Having only 2 parties makes it so convenient.
That's how the country moved rightward, with Dems, who are supposed to defend working people, having Wall St in their cabinets, And pushing Republican type major policies like financial deregulation and a health care system that leaves millions out while subsidizing medical industry profits.
Then this is called great progress by Krugman, when he should be fighting
for specific financial regulations of decades ago, and for a 1st rate h/c system with costs negotiated by govt with corporations like most other 1st world countries have had for some time.
As usual, the answer to every problem, in Krugman's mind, is more government spending, more regulation, and a stop to focusing on the huge debt and deficit. Reading one of his articles will suffice to understand every other article he writes, which at least saves time.
2
He calls for more temporary government spending when private sector spending lags; when demand is low and times are bad. A lack of enforced regulation was a factor in the recession by allowing the large financial institutions to speculate dangerously.
1
Apparently he hasn't repeated himself quite often enough. He's made it clear that the market for US government debt will tell us when it's important to prioritize deficits versus other issues. I suggest you check the returns on ten year T-notes for an indication of the market's concern for US debt right now.
1
Your comment represents an unfair and inaccurate interpretation of Nobel prize winner Paul Krugman's ideas
Cheers
Cheers
1
The French Revolution was the major turning point in historically recent history. It still affects us today. The idea that the peasants should have say in government! Horrible (the French Spelling).
Ze peasants air etting too much Cake! Zay want more and more!
Waterloo kept the European aristocrats in power 100 years. It kept the English working class in slums and factories. Look at Engels discourse on the English working class.
The idea that factory workers should be able to organize and ask for a 60 hour work week and sunday morning off! What will they ask for next?
The republicans say "don't incite class warfare". Well the rich are winning.
Inequality per the gini is a measure of how society divides the social and economic pie. Imagine a big pizza. The 1 percent, the .1 percetn and the .01 percent want more slices of the pie.
They now own congress. Get elected and then do "The Hastert". Minus the little boys. Quadruple you salary and you are still a "poor" lobbyist.
Let's beat up on minorities and cut voting rights to distract the republican base. There is always heaven!
Ze peasants air etting too much Cake! Zay want more and more!
Waterloo kept the European aristocrats in power 100 years. It kept the English working class in slums and factories. Look at Engels discourse on the English working class.
The idea that factory workers should be able to organize and ask for a 60 hour work week and sunday morning off! What will they ask for next?
The republicans say "don't incite class warfare". Well the rich are winning.
Inequality per the gini is a measure of how society divides the social and economic pie. Imagine a big pizza. The 1 percent, the .1 percetn and the .01 percent want more slices of the pie.
They now own congress. Get elected and then do "The Hastert". Minus the little boys. Quadruple you salary and you are still a "poor" lobbyist.
Let's beat up on minorities and cut voting rights to distract the republican base. There is always heaven!
41
The Professor's OpEd brings to mind a passage I read the other day in a very entertaining and well written book. ("The Dog" by Joseph O'Neill. )
"I think it’s the phenomenon of these commenters— who must be taken to represent the masses, a body from which nobody is excluded— in combination with my new intercontinental perspective, that has left me with a most unfortunate impression that my fatherland— inescapably, the United States of America— is, or has become, a strange, gigantically foolish place that sooner or later will be undone by the calamitous mental life of its population, whose bizarre domination by misconceptions is all too well incorporated by its representatives in Washington, D.C."
"I think it’s the phenomenon of these commenters— who must be taken to represent the masses, a body from which nobody is excluded— in combination with my new intercontinental perspective, that has left me with a most unfortunate impression that my fatherland— inescapably, the United States of America— is, or has become, a strange, gigantically foolish place that sooner or later will be undone by the calamitous mental life of its population, whose bizarre domination by misconceptions is all too well incorporated by its representatives in Washington, D.C."
16
Let's face it: seriously bad ideas come from seriously bad people.
You're not going to solve the problem until you get rid of the seriously bad people, it's that simple.
You're not going to solve the problem until you get rid of the seriously bad people, it's that simple.
12
Two things come to mind on reading Professor K.
1. Abe was wrong. It is mathematically true that you can't fool all the people all the time. But that is kind of irrelevant. Real world problems need solutions in the here and now, and you can fool enough of the people enough of the time to move on to the next hit and run.
2. In the 1860's the physicist James Maxwell contributed insights into
the theory of electricity and magnetism that we today regard as seminal. His ideas met great resistance in many quarters for many years and then suddenly seemed to be widely accepted. The story is told (who knows if it is true) that somebody asked Maxwell how he had managed to change his critics' minds. "I didn't," he replied. "They all died."
Economics is a much more difficult subject than physics, so it is far easier to hang onto one's opinions. And politics is not an academic subject at all. Professor K has set himself a Herculean task. I am deeply unsure if he will succeed, even though I would dearly like him to.
1. Abe was wrong. It is mathematically true that you can't fool all the people all the time. But that is kind of irrelevant. Real world problems need solutions in the here and now, and you can fool enough of the people enough of the time to move on to the next hit and run.
2. In the 1860's the physicist James Maxwell contributed insights into
the theory of electricity and magnetism that we today regard as seminal. His ideas met great resistance in many quarters for many years and then suddenly seemed to be widely accepted. The story is told (who knows if it is true) that somebody asked Maxwell how he had managed to change his critics' minds. "I didn't," he replied. "They all died."
Economics is a much more difficult subject than physics, so it is far easier to hang onto one's opinions. And politics is not an academic subject at all. Professor K has set himself a Herculean task. I am deeply unsure if he will succeed, even though I would dearly like him to.
21
Britain's Conservatives and America's Republicans are industries of seriously bad ideas; these bad ideas flow from their shared view of the role of government; that other than sending armies to war, government has no role; that government is the problem and therefore reduce the size of government until it can no longer bother the wealthy in their pursuit of more wealth and is totally ineffectual in promoting the welfare of the general public. That being said, the single most seriously bad idea is that the general public cares about its own welfare...that idea is proven wrong by the repeated self inflicted harm in which the general public elects to office Conservatives and Republicans to beat them up...and beat them down.
8
The question here is whether bad ideas are a function of ignorance or hatred, or perhaps both. As human beings it is our responsibility to alleviate suffering where we can!
4
What examples would you use to distinguish between seriously bad ideas and serious bad ideas? Referring to an idea as seriously bad suggests that it is nonsensical or dangerous but leaves aside its likelihood of being realized. Seriously bad ideas are fun to make fun of. Serious bad ideas on the other hand are, to me, bad ideas that are a real threat - they are both bad and serious, i.e., likely to be foisted upon us. For me, "corporations are people" is, was a serious bad idea, while plans to inject particulates into the Earth's atmosphere to increase the albedo and reduce global temperature rise is a seriously bad idea (currently). Of course seriously bad ideas can become serious bad ideas - e.g., need to reduce government spending when interest rates, inflation, and productivity are at all time lows.
3
Very clever posting and I agree fully
"Seriously bad ideas" do not rule our world. The people who profit from those ideas rule our world. This is the error that Mr. Krugman makes time after time, year after year: he continues to believe, in the face of all evidence to the contrary, that our political/media culture debates ideas & policies based on reason & evidence & shared goals. No. Politicians pursue policies that benefit the individuals & corporations for whom they work. The media helps the politicians sell rationalizations for those policies. Some of us are starting to wonder if we don't give Mr. Krugman too much credit. Maybe his job is to sell the illusion of a "debate" rather than advance the positions he defends?
5
Could Britain's stumbles be the result of the Murdoch press blaring its wrongheadedness into the British ether?
Irresponsible journalism is not only about phone hacking - it is far more serious than that. One wonders what to do about these dreadful people.
Irresponsible journalism is not only about phone hacking - it is far more serious than that. One wonders what to do about these dreadful people.
9
Please. Prof Krugman has been called out by the NYT Public Editor for refusing to admit errors. His complaints about others who do likewise are hypocritical.
2
I put this at the feet of the media as much as VSP's. I don't know about Britain because all of the news from there I've experienced is the BBC but here, most people are NEVER exposed to anything but Fox and at most major network news or the propaganda created by politicians themselves. I work in an office of over 300 people. None of them will have read this article but me and I'm suspect because I did. I literally have no one here to talk with about this column today. This commentary is my only outlet. It IS that bad. At Starbucks they don't have the Times, only the Wall Street Journal. This morning cable delivers only Fox channels with strong enough current that mysteriously isn't for the PBS channels. Even the local NPR radio broadcast is compromised, dominated by news that more than anything else is agitprop generated by the chamber of commerce and its affiliates.
Never mind that yesterday it came out that our state was 6th from the bottom in growth at .04% because manufacturing pays so low here more technology based and expensive manufacturing won't come, but never mind because our governor came out and said our manufacturing base remains strong. He said it so it must be true. Whew! we can all go back to our awful paying jobs relieved.
That is the state of the news for most people.
Never mind that yesterday it came out that our state was 6th from the bottom in growth at .04% because manufacturing pays so low here more technology based and expensive manufacturing won't come, but never mind because our governor came out and said our manufacturing base remains strong. He said it so it must be true. Whew! we can all go back to our awful paying jobs relieved.
That is the state of the news for most people.
401
What state do you live in?
Good for you speaking up. Wishing you courage
What is "our state"? Be sure to include a fact or two in your otherwise heartrending lament.
I have to take exception to your remarks about passenger rail service in Britain. I travel to Britain regularly and much prefer their rail serviced to Amtrak, which I use several time a year. Britain's frequent and widespread service, convenient schedules and clean, comfortable equipment and stations are quite a contrast from my experiences with Amtrak and commuter rail services here.
And please don't get me started about London Underground vs. the deplorable conditions on New York subways.
And please don't get me started about London Underground vs. the deplorable conditions on New York subways.
3
Labour lost because the Scots have a more progressive, smarter population and elected the SNP to 56 of their 59 seats which, in the past might have gone to Labour. The Scots threw Labour under the formerly government-run train. I was in Scotland the week of our (and Britain's) illegal invasion of Iraq in 2003. Every window had a peace sign. The Scottish independence vote (80% of the Scots actually voted! when has that happened here?) was defeated last year but it will come around again. And if the Brits vote against staying in the EU..it will happen faster than anyone thinks. The Scots are far more progressive than the English. We have a candidate here in the US who is not bought and, like Nicola Sturgeon, he embraces ideas that would help the 99% and not the greedy 1% who own the US. That would be Bernie Sanders. After a few debates (if Americans tune in and listen) we might have some progressive government that represents the interests of working Americans here. Labour lost because the Scots didn't vote for them.
7
Well, that can't be true, because the Tories won an absolute majority in parliament. So even if Labour received all of the SNP seats (and all of the Lib Dem, UKIP, and regional party seats), they still would have lost.
The Conservatives won 51% of the seats with 37% of the votes. Unexpected? Maybe. Landslide? Not so much.
Britain leads the world in tax havens that allows the rich and profit rich multinational corporations to shift the burden of funding government to the little people. What's good for Britain is bad for Greece and all other countries trying to administer an effective and fair tax system. Britain is the poster child for Beggar Thy Neighbor.
12
Seriously Bad Ideas are the heart and soul of the Republican Party, the cousins of British conservatives and con-artists who march to the propaganda drumbeat of Rupert Murdoch and his house of lies, rapacious greed and ethical perversity.
Eliminate the estate tax (i.e. give millionaires and billionaires a significant raise)
Eliminate or freeze the minimum wage (i.e. give the 1% a permanent raise)
Cut food stamps for poor people and increase farm subsidies to corporate 1% farms (i.e. take food from the mouths of babies and give the 1% a raise)
Cut Social Security and Medicare and pass the savings onto military/war welfare contractors
Deregulate air, water and the Earth (i.e. Grand Old Pollution)
Deny science (i.e. science and propaganda don't get along)
Teach abstinence as a form of birth control (...and cars don't need any brakes either)
Austerity is expansionary (...so I guess prosperity is contractionary).
Restrict voting --- it's the American way !
Send young Americans to die and lose limbs in the Middle East because of the mental instability of all its leaders...and lower taxes on the rich while we're at it and charge it to the middle class....because Republicans are exceptional psychopaths.
Punish the poor, step on their throats, give them big, bold easy-to-read headlines, slogans, clichés and tasty, sugar-filled, flag-waving bromides...and let the rich strip-mine the masses into economic oblivion.
Intellectual bankruptcy is the right-wing's winning formula.
Eliminate the estate tax (i.e. give millionaires and billionaires a significant raise)
Eliminate or freeze the minimum wage (i.e. give the 1% a permanent raise)
Cut food stamps for poor people and increase farm subsidies to corporate 1% farms (i.e. take food from the mouths of babies and give the 1% a raise)
Cut Social Security and Medicare and pass the savings onto military/war welfare contractors
Deregulate air, water and the Earth (i.e. Grand Old Pollution)
Deny science (i.e. science and propaganda don't get along)
Teach abstinence as a form of birth control (...and cars don't need any brakes either)
Austerity is expansionary (...so I guess prosperity is contractionary).
Restrict voting --- it's the American way !
Send young Americans to die and lose limbs in the Middle East because of the mental instability of all its leaders...and lower taxes on the rich while we're at it and charge it to the middle class....because Republicans are exceptional psychopaths.
Punish the poor, step on their throats, give them big, bold easy-to-read headlines, slogans, clichés and tasty, sugar-filled, flag-waving bromides...and let the rich strip-mine the masses into economic oblivion.
Intellectual bankruptcy is the right-wing's winning formula.
596
We love our soldiers so much that we continue to send them to die in foreign wars!
7
Its not just Republicans. Obama, after his illegal War in Libya, and "covert" aid to terrorists in Syria, is now sending "advisers" to Iraq. Thus the Endless Wars for the profits of the Merchants of Death and the Oil companies continue to waste $1 Trillion per year. Obama is twisting every arm in sight to bulldozer the Trans Pacific Pact, basically giving away our democracy to Corporate rule, which will lead to more job loss. But worse allows Corporations to sue before Corporate Boards if governments, whether local, state or federal, enact Environmental rules, support renewable energy or anything which impacts Corporate profits.
Krugman should be flagellating Obama for the TPP...
As far as skills go, presumably the current IT workers supporting Disney World are perfectly skilled to run its computers, ticketing and rides systems.
But Disney World is firing all the American IT workers anyway to bring in cheaper foreign labor via the H1B visa scam.
Supposedly H1B visas are to meet a shortage of qualified technical people.
But Disney World HAS plenty of qualified people running their systems for years. They are just cutting costs for plutocrats profits.
Boycott Disney!
Krugman should be flagellating Obama for the TPP...
As far as skills go, presumably the current IT workers supporting Disney World are perfectly skilled to run its computers, ticketing and rides systems.
But Disney World is firing all the American IT workers anyway to bring in cheaper foreign labor via the H1B visa scam.
Supposedly H1B visas are to meet a shortage of qualified technical people.
But Disney World HAS plenty of qualified people running their systems for years. They are just cutting costs for plutocrats profits.
Boycott Disney!
2
Well said......clap clap. One of your best screeds. We need people like you to have enough fire to expose the lies.
1
What austerity does do ‘successfully’ is to redistribute wealth to creditors (i.e. to banks and financiers) and forces the state and its taxpayers to pay for financial follies of private banks.
Austerity is about first saving and then enriching banks, period. Its intention is to force deflation of wages, prices, and public spending, reduce public deficits, which is suppose to inspire "business confidence" and generate economic growth.
The only problem is, it doesn't work.
Austerity does reduce wages and public spending, however, it increases deficits, destroys business confidence, and stagnates the economy.
Austerity makes the wrong people pay for the crisis. Public services are cut to bail out banks, banks caused the financial collapse. This is a bait and switch.
It fails economically by lowering growth, it fails politically (as Krugman points out) because public debt is cyclical, and will reduce with real growth. It fails morally by forcing those that did not cause the crisis pay for the crisis.
The good news is austerity lies shattered. It never works. The bad news, politicians and financiers don't care. Banks want the bail and to push the costs on society.
Austerity is about first saving and then enriching banks, period. Its intention is to force deflation of wages, prices, and public spending, reduce public deficits, which is suppose to inspire "business confidence" and generate economic growth.
The only problem is, it doesn't work.
Austerity does reduce wages and public spending, however, it increases deficits, destroys business confidence, and stagnates the economy.
Austerity makes the wrong people pay for the crisis. Public services are cut to bail out banks, banks caused the financial collapse. This is a bait and switch.
It fails economically by lowering growth, it fails politically (as Krugman points out) because public debt is cyclical, and will reduce with real growth. It fails morally by forcing those that did not cause the crisis pay for the crisis.
The good news is austerity lies shattered. It never works. The bad news, politicians and financiers don't care. Banks want the bail and to push the costs on society.
27
The failure of failure is a success? That deregulation and tax breaks for the "job creators" caused the great recession is no excuse for not continuing tax breaks for the failed "job creators" or deregulating. The problems we have are the fault of moral character flaws and college graduates who can't find a job. Sex is also a probable cause for our poor economic performance. Inequality would go away if only workers were better prepared for the new economy, we are told.
Bad ideas are their own reward. If only we try them just a little longer they might work?
Bad ideas are their own reward. If only we try them just a little longer they might work?
4
"Britain’s news media told voters, again and again, that excessive government spending under Labour caused the financial crisis." A similar situation exists in the United States. Here, as in the U.K., the news media has been captured by corporate interests, which are aligned with the wealthy elites. So, it becomes almost impossible for economic truths to come out.
Still, optimists can rest assured that future historians will see this bias of the news media for what it was: a way to help the rich get richer at the expense of everyone else.
The turning point came when conservatives in the 1980s started cutting the taxes of the rich. That process never ended, and it creates budget deficits which lead conservatives and their hacks to call for cuts to government spending. How convenient.
Still, optimists can rest assured that future historians will see this bias of the news media for what it was: a way to help the rich get richer at the expense of everyone else.
The turning point came when conservatives in the 1980s started cutting the taxes of the rich. That process never ended, and it creates budget deficits which lead conservatives and their hacks to call for cuts to government spending. How convenient.
23
I often read people criticizing those who are religious, or have faith, as believing in fairy tales. What's described in the column doesn't sound to me all that different from believing fairy tales, only the tales here are secular, political, and couched in intellectual terms. I myself don't believe that faith has to be about believing in a fairy tale. So I separate out a need to believe in fairy tales from anything intrinsic to religion or to politics -- I see it as just a need, perhaps a psychological one. My own focus is more on how individual damaged human beings perpetuate damage, often through their use of maladaptive self-protective coping devices. I don't see how anything gets improved without a stronger foundation at that level.
6
"No matter how much contrary evidence comes in, no matter how often and how badly predictions based on those ideas are proved wrong, the bad ideas just keep coming back." (PK)
Dr. Paul Krugman meet J.J Rousseau: “Let us begin by setting aside the facts, for they do not affect the matter at hand.”
If facts actually mattered, the people Dr. K references would have been pushed to the wayside long ago. The fact that they have not been only proves J.J.'s point.
Dr. Paul Krugman meet J.J Rousseau: “Let us begin by setting aside the facts, for they do not affect the matter at hand.”
If facts actually mattered, the people Dr. K references would have been pushed to the wayside long ago. The fact that they have not been only proves J.J.'s point.
11
Seriously bad ideas survive because they are not and have never been ideas. They are fig leafs for policies that fleece the little guy and further enrich the billionaire class.
12
Rupert Murdoch's propaganda machine has twisted British public opinion and disrupted British neurotransmissions as badly in Britain as he's done in the United States.
His News UK subsidiary and 'news'papers The Sun, The Times and the Sunday Times have been doing to Britain what News Corp's FOX has done to America's brain - stunted it, retarded it and filled it with nonsensical libertarian hogwash, racism, cover girls, and fear-mongering in order to lower as many humans to their basest instincts of hate, spite, fear and utter confusion over reality.
When one looks at the purported theories of pretend libertarians and conservatives in America and Britain, all there is a curtain of conservatism and libertarianism hiding the vicious and rapacious greed.
Murdoch has successfully conned the world with a media shell game that helps defraud the public with by defeating facts with falsities as a master con-artist and deregulator of business and worker rights -all for the destruction of the common good with private fortune.
The news itself is a public good and its wholesale purchase by master propagandists like Rupert Murdoch and his Fake News empire is a hijacking of a public good.
What America and Britain need is a reinstatement of a Fairness Doctrine which would reinject a bias for fact over propaganda and a quintupling of public investment in PBS and the BBC to counter professional liars, criminals and psychopaths like Rupert Murdoch and his industrial house of lies and liars.
His News UK subsidiary and 'news'papers The Sun, The Times and the Sunday Times have been doing to Britain what News Corp's FOX has done to America's brain - stunted it, retarded it and filled it with nonsensical libertarian hogwash, racism, cover girls, and fear-mongering in order to lower as many humans to their basest instincts of hate, spite, fear and utter confusion over reality.
When one looks at the purported theories of pretend libertarians and conservatives in America and Britain, all there is a curtain of conservatism and libertarianism hiding the vicious and rapacious greed.
Murdoch has successfully conned the world with a media shell game that helps defraud the public with by defeating facts with falsities as a master con-artist and deregulator of business and worker rights -all for the destruction of the common good with private fortune.
The news itself is a public good and its wholesale purchase by master propagandists like Rupert Murdoch and his Fake News empire is a hijacking of a public good.
What America and Britain need is a reinstatement of a Fairness Doctrine which would reinject a bias for fact over propaganda and a quintupling of public investment in PBS and the BBC to counter professional liars, criminals and psychopaths like Rupert Murdoch and his industrial house of lies and liars.
303
I'm pretty sure that Republicans got rid of the Fairness Doctrine quite intentionally and with a plan for the news media to become exactly what it is today.
7
But when Congressional Republicans accused PBS of liberal propagandizing at government expense (facts having a liberal bias) and threatened their funding, PBS marched rightward and became "Fair and balanced." PBS is no counterbalance to Fox News.
Seriously bad ideas probably don't rule the world but they certainly rule Paul Krugman's columns. Of these, the first is that one can endlessly repeat the same tired and hallucinatory sermons on evil wealth and corporate interests and malevolent conservatism. The second is that half truths suffice. The prime example being that "the true story of economic disaster... is that it was caused by an inadequately regulated financial industry run wild". In fact, governments in the developed world encouraged and often pushed recklessness in finance to meet their political needs.. The prime example is the roles of Fannie Mae and Freddie Mac, egged on by Congress, in creating huge numbers of risky mortgage loans made to applicants incapable of paying them back. Happening at a time when the U.S. economy was particularly dominant, China undeveloped and Russia in distress, the reverberations of U.S. federal financial policies in Europe drove the ;worldwide" effects.
2
Anyone who believes that Fannie and Freddie were primary factors in causing the Great Recession were not part of the financial industry and/of the mortgage lending/securitization industry. Did they get caught up in the maelstrom? Yes. Should their execs have demonstrated better risk management? Absolutely. But they were nothing compared to what was going in in the "private" lending markets. The Countrywide's and others wrecked the housing industry---with the help of Wall Street securitization machine, and employees (across the industry) with weak ethical compasses. And Mozzilo should be in jail instead of living high on the hog from his once nearly $500 million in annual comp.
17
That Fannie Mae and Freddie Mac myth has long been exploded. Yes, their activities were awful maybe criminal. But they played little part in the financial meltdown. Not because they were virtuous but because having been caught out in previous misconduct, they couldn't participate in the mortgage fiasco until close to its finish. And that's how zombies continue to thrive because the people who believe in them know that shedding a little light on the matter will kill them.
4
Dr. Krugman, this is becoming a favorite theme of yours, and for good reason. You report on Britain, about whose economy I remain ignorant. Yet the philosophical underpinnings are unchanged: it's really pretty amazing when philosophies and ideologies long proved wrong have become not only gospel, but the starting point for political agendas.
Of course I'm thinking of "Trickle "Down" and the rest. Just last night, I listened to one pundit expound on the power and beauty of "free markets" as if deregulation would cure all ills. But free markets unrefined and unchecked can decimate a middle and lower class who get no ounce of spoils from the unfettered profits of those who run free markets.
As you continually point out, wrong-headed (or simply bad) policies promoted over and over, will only produce weary results. Man cannot change the laws of gravity or economics: a ball rolled up a hill will surely roll down as sure as day follows night.
Of course I'm thinking of "Trickle "Down" and the rest. Just last night, I listened to one pundit expound on the power and beauty of "free markets" as if deregulation would cure all ills. But free markets unrefined and unchecked can decimate a middle and lower class who get no ounce of spoils from the unfettered profits of those who run free markets.
As you continually point out, wrong-headed (or simply bad) policies promoted over and over, will only produce weary results. Man cannot change the laws of gravity or economics: a ball rolled up a hill will surely roll down as sure as day follows night.
17
John Maynard Keynes lived in an era when tariffs were the main revenue for governments. And therein lies your flawed theory. Tax rates have a direct effect on behavior, whether it's trying to avoid them or investing. Tariffs do not. The world has changed systemically in commerce, but our tax code is the same. And even though we have increased government outlays dramatically, the U.S. economy is in the tank. Government spending simply does not create jobs. Krugman will argue that the stimulus saved jobs that would have otherwise been lost. Pure speculation. More "what ifs". 93 million Americans not in the workforce, 2% GNP growth, millions of part time jobs, no more overtime. Those are some ugly numbers. If given a choice between toil and leisure, the latter usually wins out. Adam Smith was correct Professor. economics is the study of human behavior.
1
Government spending most definitely creates jobs when the spending is devoted to paying the salaries of government employees. When local counties decrease funding for school systems and class sizes have to be increased, fewer teachers are employed and some lose their jobs. Because of the multiplier effect, those unemployed teachers without incomes to spend have an effect on the wider economy. I am so tired of hearing that "government spending doesn't create jobs." I'm pretty sure that the budgets of most government agencies mostly go to pay employees. Government consists mostly of people carrying out the mandates of laws.
2
"Government spending simply does not create jobs." Gee, I was a government employee for 41 years, but according to you I really didn't have a job since government spending doesn't create jobs. Oh, by the way, what about all those infrastructure jobs (roads, bridges, etc.) from federal and state spending. According to you, those aren't jobs either!
2
All true; however, the problem, here in Illinois, is that our government is using our tax dollars to feed the hungry pension machine, an unrealistic, unreformed compensation plan, ill-suited to the 21st century. After years of mismanaged pension funds and with absolutely no constitutional authority to reform the system, we are stuck in a quagmire. One with bad roads, overcrowded classrooms, less and less services for the taxpayers, but ever higher property and income taxes.
"...And it won't make one bit of difference if I answer right or wrong.
When you're rich, they think you really know!"
... from "If I were a Rich Man" in the Fiddler on the Roof.
The rich people act serious, talk serious, and their prescriptions are that the poor people must endure more pain, and that will cure them of their ills. A bit like ignorant physicians prescribing leaches to such the bad blood out of you.
One problem.
The collapse of all great civilizations has been preceded by concenttrations of wealth and the wealthy people not wanting to pay their taxes: Ancient Egypt's New Kingdom; Western Roman Empire, Byzantium, Medieval Japan, Hapsburgh Spain, Bourbon France, Romanov Russia, Coolidge/Hoover America (leading to the Great Depression, the rise of Hitler, WWII, an the Holocost), and the current mess.
They all had rich wise men that said concentration of wealth is good, taxes are bad, poor people need to suffer before they get better.
"If I were a rich man,
...
All day long I'd biddy biddy bum.
If I were a wealthy man.
I wouldn't have to work hard.
ya ba dibba dibba dibba dibba dibba dibba dum.
If I were a biddy biddy rich,
Yidle-diddle-didle-didle man."
When you're rich, they think you really know!"
... from "If I were a Rich Man" in the Fiddler on the Roof.
The rich people act serious, talk serious, and their prescriptions are that the poor people must endure more pain, and that will cure them of their ills. A bit like ignorant physicians prescribing leaches to such the bad blood out of you.
One problem.
The collapse of all great civilizations has been preceded by concenttrations of wealth and the wealthy people not wanting to pay their taxes: Ancient Egypt's New Kingdom; Western Roman Empire, Byzantium, Medieval Japan, Hapsburgh Spain, Bourbon France, Romanov Russia, Coolidge/Hoover America (leading to the Great Depression, the rise of Hitler, WWII, an the Holocost), and the current mess.
They all had rich wise men that said concentration of wealth is good, taxes are bad, poor people need to suffer before they get better.
"If I were a rich man,
...
All day long I'd biddy biddy bum.
If I were a wealthy man.
I wouldn't have to work hard.
ya ba dibba dibba dibba dibba dibba dibba dum.
If I were a biddy biddy rich,
Yidle-diddle-didle-didle man."
68
I know you have to produce a column but arguing with conservatives or about their policies is futile. They say and do what they say and do because of their ideology. Their ideology is to maximize personal profit. How it happens is not relevant. Reasons stated are not relevant. What they say is a rationalization to convince others of the appearance of logic that says "this is for your own good." What they mean is that "this is for my good." In the US, the financial crisis was intended, and the result of putting in place regulators who job was to make sure no one regulated, e.g., the SEC. Anyone watching the policies of the US since Reagan and listening to that was promoted, i.e., greed, knows what was going to happen and why. Even if you read nothing but home loan ads where one could buy a house for nothing down and future payments knew that would never work but rather come crashing down on the uncautioned desires of young and careless families. When Clinton took the advice of Sen. Graham and killed Glass-Steagal, the signs could not have been more obvious. But then, beating dead horses never seems to go out of style. Thanks anyway.
48
The extremely successful, 70 year old VA home loan problem is entirely based on buyers (veterans) being able to buy homes with nothing down. So unfortunately that part of your theory is wrong.
The buyers who put nothing down were caught by two economic situations much larger than themselves (and apparently hard to predict, since nobody including the professor accurately predicted them) -- a sudden collapse of prices AND a sudden collapse in the job market. If the home you just bought goes from $300K to $125K and on top of that, you are laid off and cannot make the payments (on either amount) -- you will walk away rather than accept financial ruination. And that's what happened for several years. Of course there is more to it, if but if you are speaking about the housing/foreclosure part -- that's it. (The reason it worked for veterans is that the housing market was exceptionally stable, and the economy generally good for jobs.)
The buyers who put nothing down were caught by two economic situations much larger than themselves (and apparently hard to predict, since nobody including the professor accurately predicted them) -- a sudden collapse of prices AND a sudden collapse in the job market. If the home you just bought goes from $300K to $125K and on top of that, you are laid off and cannot make the payments (on either amount) -- you will walk away rather than accept financial ruination. And that's what happened for several years. Of course there is more to it, if but if you are speaking about the housing/foreclosure part -- that's it. (The reason it worked for veterans is that the housing market was exceptionally stable, and the economy generally good for jobs.)
It was Senator Phil Gramm. The Commodity Futures Modernization Act was also written by Phil Gramm, the architect of the 2008 collapse. It forbid regulation of derivatives, opened the Enron Loophole and allowed the establishment of "shadow exchanges. You might be amused by the manner in which that bill was passed at the very end of the 2000 lame duck session.
"The Republican leadership of the House incorporated "The Commodity Futures Modernization Act of 2000(H.R. 5660)" by reference, as Section 1(a)(7), in a long and complex conference report to the 11,000 page long "2000 omnibus budget bill"'
So nobody saw the bill until after the conference report on the omnibus budget bill where it was buried in a footnote. It was never debated in the House or the Senate, never sent to any committee, and it was not attached to the bill until AFTER the conference in the dead of night.
"The Republican leadership of the House incorporated "The Commodity Futures Modernization Act of 2000(H.R. 5660)" by reference, as Section 1(a)(7), in a long and complex conference report to the 11,000 page long "2000 omnibus budget bill"'
So nobody saw the bill until after the conference report on the omnibus budget bill where it was buried in a footnote. It was never debated in the House or the Senate, never sent to any committee, and it was not attached to the bill until AFTER the conference in the dead of night.
Explaining the productivity slump is pretty straightforward. For decades, there was a virtuous cycle of increasing worker productivity leading to increasing corporate profits resulting in increasing worker compensation, which spurred the worker to increase productivity. It would seem the 'little people' have noticed that increased corporate profits only increases the compensation of the upper tiers, not the 'little people'.
As for the skills gap, again, pretty straightforward. Big business is defining the labor pool requirements. As a recent story illustrated, if the business decides that you need an MBA to qualify for an entry level clerical position, they have employee deficit because of a skills gap. So, whose fault is this?
As for the skills gap, again, pretty straightforward. Big business is defining the labor pool requirements. As a recent story illustrated, if the business decides that you need an MBA to qualify for an entry level clerical position, they have employee deficit because of a skills gap. So, whose fault is this?
8
It is commendable that PK is calling out the "VSP's" for bad economics and bad policy.
And he is right to call attention to our economic problems of productivity accelerating at a lower rate, persistently high unemployment, and the growing number of workers earning wages which are below the cost of living.
However, PK is really doing a disservice by referring to our economic problems as being caused by a financial crisis.
This really mischaracterizes the situation, directing attention away from the real chronic problem, which (although masked by cyclical events, such as the housing bubble) are at the root of our economic problems.
The real cause, is a chronic lack of demand in the US (and world) economy, building up over decades. This is both a cause, and a result, of inequality - as consumer / workers need to work more hours and spend less, the labor pool grows, jobs become scarce, and wages drop.
Chronic low demand also enabled the massive housing bubble. Had demand been high and labor tight at the start of the bubble, the resulting labor shortage would have soon caused inflation and higher interest rates, nipping the housing bubble in the bud.
PK does a great disservice (and gives banks too much credit, blame, and reverence) by referring to the popping of the biggest demand bubble in history, as a "financial crisis".
And he is right to call attention to our economic problems of productivity accelerating at a lower rate, persistently high unemployment, and the growing number of workers earning wages which are below the cost of living.
However, PK is really doing a disservice by referring to our economic problems as being caused by a financial crisis.
This really mischaracterizes the situation, directing attention away from the real chronic problem, which (although masked by cyclical events, such as the housing bubble) are at the root of our economic problems.
The real cause, is a chronic lack of demand in the US (and world) economy, building up over decades. This is both a cause, and a result, of inequality - as consumer / workers need to work more hours and spend less, the labor pool grows, jobs become scarce, and wages drop.
Chronic low demand also enabled the massive housing bubble. Had demand been high and labor tight at the start of the bubble, the resulting labor shortage would have soon caused inflation and higher interest rates, nipping the housing bubble in the bud.
PK does a great disservice (and gives banks too much credit, blame, and reverence) by referring to the popping of the biggest demand bubble in history, as a "financial crisis".
3
The problem is a world with 7 billion people, most of whom would happily work for 30 cents a day and take your job. A lot of them (China) already have done os.
With high technology, there is no longer any need for as many workers as we used to require -- we can provide all the goods and services that society can consume with many fewer workers.
This is not a US problem alone. Liberal European nations, Scandinavia -- they all struggle with lack of jobs.
So far, I have not heard one credible idea on the left OR the right (or anywhere else) as to how to create more jobs. Not one. And everything we have tried has crashed & burned. It's time to go back to the drawing table, and that means serious work -- not blaming others because they don't agree with you, Dr. Krugman.
With high technology, there is no longer any need for as many workers as we used to require -- we can provide all the goods and services that society can consume with many fewer workers.
This is not a US problem alone. Liberal European nations, Scandinavia -- they all struggle with lack of jobs.
So far, I have not heard one credible idea on the left OR the right (or anywhere else) as to how to create more jobs. Not one. And everything we have tried has crashed & burned. It's time to go back to the drawing table, and that means serious work -- not blaming others because they don't agree with you, Dr. Krugman.
The way to create demand is to create money and get it to the people who need it and will spend it. Only the federal government can do that without also creating private debt.
Sometimes I think Paul Krugman likes to have fun at his readers' expense. There is no evidence Very Serious People are going to be swayed by evidence....period. It is not that the rest do not offer them enough data, or do not speak or write clearly enough, or have not developed the proper networks. The Very Serious People know very well that climate change is real, that the Laffer Curve is a joke, and the Crash of 2008 had its roots in the financial sector. But knowing these things is not important because their economic preferences are served by denying climate change, embracing the Laffer Curve, and blaming the Crash on others. At best evidence is inconvenient and superfluous, at worst a threat to a carefully-constructed and consciously-bogus.
The core problem is the haves convinced themselves during the Reagan era they could renounce the social contract and democratic principles with no ill effects, that a combination of money,technology, and manipulation will permit them to amplify their choices while constraining ours. To date they have provén to be correct. The worker skills gap is a pretense to bring in cheap foreign labor, the people who promote it know it, yet do so because it is profitable. Believing money and privilege will protect them and their heirs from disaster, why risk awkward policy shifts? These are not ¨bad ideas¨ held accidently or mistakenly, these are deliberate choices by a segment of society without a sense of social responsibility.
The core problem is the haves convinced themselves during the Reagan era they could renounce the social contract and democratic principles with no ill effects, that a combination of money,technology, and manipulation will permit them to amplify their choices while constraining ours. To date they have provén to be correct. The worker skills gap is a pretense to bring in cheap foreign labor, the people who promote it know it, yet do so because it is profitable. Believing money and privilege will protect them and their heirs from disaster, why risk awkward policy shifts? These are not ¨bad ideas¨ held accidently or mistakenly, these are deliberate choices by a segment of society without a sense of social responsibility.
126
We need a revolution, people, a revolution.
3
USA999:
Well said.
Well said.
usa999, I wish I could recommend this comment 100 times. This is spot on.
2
How is it that the world cannot survive without debt? Mr. Krugman insists that borrowing is okay, because costs are low. But why must we borrow? It was not that long ago that debt was something that was avoided, now it is expected. Indeed, we are now expected to borrow instead of saving, which leads one to wonder where the money we borrow is coming from, if there are no savings to lend out.
The financial world seems to me to be on its head, while at the same time forcing the rest of the world to dance to its crazy tune. The United States has exported everything possible, even financial terrorism. We tell everyone to invest in their retirement, then we let the robber barons steal that investment. The Federal Reserve purchased several trillion dollars worth of U.S. bonds, effectively increasing the money supply by that amount. Isn't that what inflation is all about?
Money has lost its relevance to many people, as it no longer represents anything, and money can be created without performing work or adding value. Real wealth is being destroyed through neglect and abuse, so that bridges are falling down, roads are disintegrating, and the power grid is collapsing. We are all trying very hard to maintain the illusion that we are not all broke.
The financial world seems to me to be on its head, while at the same time forcing the rest of the world to dance to its crazy tune. The United States has exported everything possible, even financial terrorism. We tell everyone to invest in their retirement, then we let the robber barons steal that investment. The Federal Reserve purchased several trillion dollars worth of U.S. bonds, effectively increasing the money supply by that amount. Isn't that what inflation is all about?
Money has lost its relevance to many people, as it no longer represents anything, and money can be created without performing work or adding value. Real wealth is being destroyed through neglect and abuse, so that bridges are falling down, roads are disintegrating, and the power grid is collapsing. We are all trying very hard to maintain the illusion that we are not all broke.
7
Borrowing is leverage. It can amplify growth. Money means everthing to those 1% that are intent are keeping it for themselves despite the pending social revolution it precedes.
Scott, you should distinguish between private and public debt. The deficit measures the net flow of money from the federal gov to people. businesses, and state & local gov. A surplus measures the flow in the opposite direction--away from us back to the federal gov.
If not enough money is flowing to us, we turn to banks to get money which creates private debt which may build up to be unsupportable.
If not enough money is flowing to us, we turn to banks to get money which creates private debt which may build up to be unsupportable.
The finacial crisis created the perfect storm for bad ideas to flourish and conservatives, enabled by the crises driven and corporate sponsored media took full advantage. As the economic dominoes fell throughout the world, blame was immediately placed, not on the financial crooks and liars that initiated the catastrophe but on the middle class and poor that were victimized by it. For the past eight years, they've created a new world order for developed nations, where staggering inequality has become an acceptable consequence of the one overriding principle - to finally create a global plutocracy that rules the world as it enriches itself to the demise of everybody else. This is the plan and those running this show know exactly what they're doing.
6
And they are succeeding very nicely.
Well, the Very Serious People who espouse the bad ideas in order to steal from the rest of us. Aren't they also the Very Rich People whose main goal in life is to raise our taxes and reduce theirs?
And didn't they inherit most of their wealth? Six of the ten wealthiest Americans inherited it all, and twp of the others inherited most of it. Abour 76% of wealth in America was inherited.
Isn't it time to take the wealth away from the top 1% of inheritors? The Comedy Party favors limiting inheritance to $1 million. Thomas Jefferson did it when he was governor of Virginia, and we should do it too. At least we would get fewer seriously bad ideas.
To see other common sense ideas, go to YouTube and watch Comedy Party Platform (2 min 9 sec). Then invite me to speak to your group, and maybe send a buck to Bernie.
And didn't they inherit most of their wealth? Six of the ten wealthiest Americans inherited it all, and twp of the others inherited most of it. Abour 76% of wealth in America was inherited.
Isn't it time to take the wealth away from the top 1% of inheritors? The Comedy Party favors limiting inheritance to $1 million. Thomas Jefferson did it when he was governor of Virginia, and we should do it too. At least we would get fewer seriously bad ideas.
To see other common sense ideas, go to YouTube and watch Comedy Party Platform (2 min 9 sec). Then invite me to speak to your group, and maybe send a buck to Bernie.
3
The absolute worst of the "seriously bad ideas" is the Right's claim that de-regulating markets and empowering corporations will somehow lead to broad prosperity and ever-increasing living standards. The actual result, after thirty plus years, is the opposite- real wages have gone nowhere while income growth and wealth concentration are at levels not seen since the 1920's.
This social disaster is exactly what one would expect from a world where both government and the economy are run by and for corporations and those who own them. Contrary to their propaganda, most corporations are now paying zero federal income tax. The corporate share of the overall tax load is now 5%, compared to 25% in the pre-Reagan era. Apparently, that's not enough. Republicans are out there with proposals to eliminate them completely. To be financed, no doubt, by destroying any remaining social programs. Corporatized government in action.
This social disaster is exactly what one would expect from a world where both government and the economy are run by and for corporations and those who own them. Contrary to their propaganda, most corporations are now paying zero federal income tax. The corporate share of the overall tax load is now 5%, compared to 25% in the pre-Reagan era. Apparently, that's not enough. Republicans are out there with proposals to eliminate them completely. To be financed, no doubt, by destroying any remaining social programs. Corporatized government in action.
36
Right now I am dealing with an elderly parent experiencing some delusions. No amount of demonstrations to the contrary, facts, reason, or emotional appeal can sway her from her belief. She holds on to it as if her entire ego is dependent on maintaining the delusion and invents ever more nonsensical defenses of its reality - though with a surprisingly almost rational internal logic and persistent effort to blame others.
The experience has raised the question for me of how do you get through to a person who's whole world – their whole psychological being - depends on never letting anyone get through to them; when their inner goal is not to find the truth but to hide from the truth?
Its fair to say we all suffer in one degree or another from my parent's plight. We distort, rationalize, and even unknowingly and knowingly lie to defend our reality - or in this case, our ideas - whether for the benefit of our ego, financial security, or ideology.
Its been 30 years since giving tax cuts to the wealthy (the "laffer" curve) has been proven to be a laugh and yet still it lingers on as a cornerstone of rightwing policy. I don't expect any other wrongly held idea will be let go by them any time soon. The best you can hope to do is keep them out of office and make sure they don't have the power to act on their delusions.
Then again when you think how easily people seem to have forgotten the Iraq War and the Great Recession maybe its our own delusions we need to worry about.
The experience has raised the question for me of how do you get through to a person who's whole world – their whole psychological being - depends on never letting anyone get through to them; when their inner goal is not to find the truth but to hide from the truth?
Its fair to say we all suffer in one degree or another from my parent's plight. We distort, rationalize, and even unknowingly and knowingly lie to defend our reality - or in this case, our ideas - whether for the benefit of our ego, financial security, or ideology.
Its been 30 years since giving tax cuts to the wealthy (the "laffer" curve) has been proven to be a laugh and yet still it lingers on as a cornerstone of rightwing policy. I don't expect any other wrongly held idea will be let go by them any time soon. The best you can hope to do is keep them out of office and make sure they don't have the power to act on their delusions.
Then again when you think how easily people seem to have forgotten the Iraq War and the Great Recession maybe its our own delusions we need to worry about.
678
It seems to me that our greatest delusion -- the one that too many of us will cling to while we steadfastly hide from the truth -- is that we think we still have a democracy. We don't. We now have an oligarchy that is only thinly veiled by mouthpieces on any side of any political fence. All those mouthpieces are fed by the one percent. The "voice that cryeth in the wilderness" will only be heard once the destruction of order - the death of the Empire - eradicates the West's one percent in favor of the next one percent.
2
"He who pays the piper calls the tune" and he likes it all the way to the bank.
It's incredibly ironic that you are guilty of the very same thing you criticize.
Laffer was correct. Cutting taxes from the high percentage that existed at the time did raise revenue. Look up the tax receipts before and afterwards.
People don't realize Laffer was correct because Ronnie outspent the increased revenues.
Laffer was correct. Cutting taxes from the high percentage that existed at the time did raise revenue. Look up the tax receipts before and afterwards.
People don't realize Laffer was correct because Ronnie outspent the increased revenues.
"It must also absolve corporate interests and the wealthy from responsibility for what went wrong, and call for hard choices and sacrifice on the part of the little people"-Paul Krugman
I thought that the professor was going to write about the New Jersey governor, whose stock in trade is "hard choices" for everyone else but neither for himself nor for the wealthy.
I thought that the professor was going to write about the New Jersey governor, whose stock in trade is "hard choices" for everyone else but neither for himself nor for the wealthy.
9
37% of British voters chose the Conservatives, which gave them a plurality in a majority of the voting districts, which gave them a solid majority in Parliament. As in the US, the party that wins a plurality usually wins the election, even though the majority voted against them. Sadly, Prof Arrow proved that there is no way to 'fix' voting: any time there are more than two alternatives, there is no fair way to choose one of them that works every time.
On Monday, Prof Krugman used the word derp from South Park, a word that, when I looked it up, was the name of a character: no definition was given (although Prof Krugman provided one).
The problem of false statements becoming accepted as 'knowledge' was named several years ago with a much classier term than derp: epistemic closure, which, like derp, refers to patently false statements so deeply embedded as 'knowledge' that no contrary facts or evidence can possibly overwhelm them.
On Monday, Prof Krugman used the word derp from South Park, a word that, when I looked it up, was the name of a character: no definition was given (although Prof Krugman provided one).
The problem of false statements becoming accepted as 'knowledge' was named several years ago with a much classier term than derp: epistemic closure, which, like derp, refers to patently false statements so deeply embedded as 'knowledge' that no contrary facts or evidence can possibly overwhelm them.
157
And I was hoping Dr. Krugman would use the words gormy twit, given his present locale.
I don't think that is quite what Arrow proved. He proved that there is no system involving three or more candidates that can yield a complete and transitive ranking. There will always be a situation that will result in the less popular candidate winning. Nonetheless it is known now that simply ranking the candidates generically yields the fairest outcome. Of course we never use that procedure out of misguided traditionalism.
Actually, here is a definition of Derp, first used in a South Park movie in 1998, before the introduction of a Derp character on South Park:
http://knowyourmeme.com/memes/derp
http://knowyourmeme.com/memes/derp
1
I was hoping you'd write this, and it was the first thing I looked for in the NYT this morning. Osborne's strategy just makes me think of the last line of the 'Bridge on the River Kwai', "Madness, madness, madness".
12
Conservative con job prevails
Much blatherskite blithely entails,
Media assisting
Bunco persisting
With Ma Hubbard's cupboard bare, fails.
Much blatherskite blithely entails,
Media assisting
Bunco persisting
With Ma Hubbard's cupboard bare, fails.
8
and about the 'seriously bad idea sharing a currency without a common budget' -(aka the Euro) - you might need more of a holistic view or perhaps more of a long term thinking to understand our post-post modern world.
Without 'sharing a currency without a common budget' - European countries which have ... lets call it - more of an orthodox approach to economics NEVER would have had to reform. And I'm not talking about 'austerity' her - I'm talking about the reform of Oligarchig structures and Inequality and the corruption by the Rich.
After many -(sometimes hundred of years) - these type of Olgarchig structures are now questionend and they WILL get reformed by Europes united efforts.
And we all owe it to the fact that a common currency leaves NO other chance.
Without 'sharing a currency without a common budget' - European countries which have ... lets call it - more of an orthodox approach to economics NEVER would have had to reform. And I'm not talking about 'austerity' her - I'm talking about the reform of Oligarchig structures and Inequality and the corruption by the Rich.
After many -(sometimes hundred of years) - these type of Olgarchig structures are now questionend and they WILL get reformed by Europes united efforts.
And we all owe it to the fact that a common currency leaves NO other chance.
2
Maybe no other "chance"/[choice? – in a "rational world"?], but I recommend reading some books on the missteps that led up to WWI ("The Great War") and there are many examples of great countries misjudging to their deep dismay – all it takes is a continuation of the arrogance recently shown by the "Troika" negotiating with Greece to put in place a path to Eurozone economic ruin.
Good luck and may reason (along Professor Krugman's proposals) prevail.
Good luck and may reason (along Professor Krugman's proposals) prevail.
So far oligarchic structures rule. We'll see if the euro saves us all from this, and if Europe can re-introduce a system good for all. We need a shining beacon somewhere in the world.
Great takedown of the Very Serious People Crowd and especially the mountebank George Osborne. It doesn't take much to kill the truth but propaganda dies a hard death. I listen for as long as I can to a financial service "news show". The heads and there guests constantly harp on these themes of austerity, bad education, skills mismatch, free trade and on. In almost every case you could take the script, record it, put it in the voice processor and it would come out and be a shill like Osborne. Enough. Several years ago Dr. K. recommended a book in his column on this subject, so for the new readers I am returning the favor.
Zombie Economics: How Dead Ideas Still Walk among Us by John Quiggin.
Zombie Economics: How Dead Ideas Still Walk among Us by John Quiggin.
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The only Very Serious Person I know about is....Dr. Paul Krugman.
Dear Mr. Krugman,
I can understand your excoriations of the GOP/TP/KOCH AFFILIATE's enchantment with "trickle down" which, in this country, generally means the rich toss a coin; heads they win, tails, everyone else loses. So far, the wealthy have done quite well promoting this "game" with 1/2 of our Congress made of millionaires and the rest trying to be.
But to extend the same arguments to England and then write a column about it?
I do think you're giving "the likes of Mr. Osborne too much credit" as, I'm sure, most readers of your column are really more concerned about the state of affairs in this country.
Europe may have "rebounded" since WW2 but only because of 2 actions by the United States: a. Lend Lease, which helped England and Europe survive WW2 and b. The Marshall Plan, which helped rebuild the entire thing.
Otherwise, on an economic front, Europe is a "competitor" with the United States and if England is on the threshold of collapse (economically), isn't that, sort of, good news?
My view of "capitalism" is that, ultimately, it fathers many "losers" and only one "winner"; just whom do you want as that "winner"?
I can understand your excoriations of the GOP/TP/KOCH AFFILIATE's enchantment with "trickle down" which, in this country, generally means the rich toss a coin; heads they win, tails, everyone else loses. So far, the wealthy have done quite well promoting this "game" with 1/2 of our Congress made of millionaires and the rest trying to be.
But to extend the same arguments to England and then write a column about it?
I do think you're giving "the likes of Mr. Osborne too much credit" as, I'm sure, most readers of your column are really more concerned about the state of affairs in this country.
Europe may have "rebounded" since WW2 but only because of 2 actions by the United States: a. Lend Lease, which helped England and Europe survive WW2 and b. The Marshall Plan, which helped rebuild the entire thing.
Otherwise, on an economic front, Europe is a "competitor" with the United States and if England is on the threshold of collapse (economically), isn't that, sort of, good news?
My view of "capitalism" is that, ultimately, it fathers many "losers" and only one "winner"; just whom do you want as that "winner"?
2
Totally unfettered capitalism does "father many 'losers' and only one 'winner,' " but,fortunately, so far there has been no unfettered capitalism since feudal times.
In today's "globalized" world, when Europe does badly the U.S. also suffers. A strong case can be made that the current growth weakness in Europe has cost somewhere between 0.5 and 1% less GDP growth in the U.S. which has also been reflected back to Europe in some of the recent improvement there.
The non-necessity of a single "winner" is at the heart of the arguments for improved trade, which is at the heart of regulated capitalism.
In today's "globalized" world, when Europe does badly the U.S. also suffers. A strong case can be made that the current growth weakness in Europe has cost somewhere between 0.5 and 1% less GDP growth in the U.S. which has also been reflected back to Europe in some of the recent improvement there.
The non-necessity of a single "winner" is at the heart of the arguments for improved trade, which is at the heart of regulated capitalism.
Dear DonB,
Today's world is the "globalized" world? So I assume the United States participation in both World Wars doesn't count as a form of "globalization"?
As far as "capitalism" is concerned, there is only room for one at the top of that pyramid and until someone can convince me that the world is truly "globalized" and not "regional" or "country" oriented, then I will stand by my first statement.
Today's world is the "globalized" world? So I assume the United States participation in both World Wars doesn't count as a form of "globalization"?
As far as "capitalism" is concerned, there is only room for one at the top of that pyramid and until someone can convince me that the world is truly "globalized" and not "regional" or "country" oriented, then I will stand by my first statement.
"...just whom do you want as that "winner"?"
Mankind?
Mankind?
John Maynard Keynes' Very Bad Ideas have lasted for more than 80 years. I keep hoping they will be beaten back into the dust, but Paul Krugman is living proof that Very Bad Ideas can still survive the years of evidence that they are wrong.
Keynes' basic idea is that consumption drives the economy. He was wrong. Production - the action of creating something that didn't exist before - is the motor of an economy. The US Government with its trade policy (Smoot-Hawley) destroyed the US economy in 1929 and triggered the Great Depression. Why? Because when foreigners cannot sell their products here, Americans cannot sell our products there. Trade was destroyed. Roosevelt - whose Brainless Trust believed in Keynes' ideas of government spending because "tomorrow, we're all dead anyway" - established Colossal Government, to spend its way out of the Depression. Paul Krugman would have cheered them on.
Government spending takes wealth from those who have it and gives it to those who don't. This is a zero-sum game: the wealth taken does not create jobs, it moves them.
Government Does Not Create. Individuals create. Give them freedom, and they create more. Give Paul Krugman freedom, and individuals create less.
Keynes' basic idea is that consumption drives the economy. He was wrong. Production - the action of creating something that didn't exist before - is the motor of an economy. The US Government with its trade policy (Smoot-Hawley) destroyed the US economy in 1929 and triggered the Great Depression. Why? Because when foreigners cannot sell their products here, Americans cannot sell our products there. Trade was destroyed. Roosevelt - whose Brainless Trust believed in Keynes' ideas of government spending because "tomorrow, we're all dead anyway" - established Colossal Government, to spend its way out of the Depression. Paul Krugman would have cheered them on.
Government spending takes wealth from those who have it and gives it to those who don't. This is a zero-sum game: the wealth taken does not create jobs, it moves them.
Government Does Not Create. Individuals create. Give them freedom, and they create more. Give Paul Krugman freedom, and individuals create less.
6
Really?
Individuals organized the effort that won the world wars? Individuals organized the legal system that created the greatest market place in the world? Individuals organized the interstate highway system? The air traffic control system? The system of universal education? Social security?
Individual freedom liberates human energy and creativity but organization creates the environment in which productivity is channeled for societal good
Individuals organized the effort that won the world wars? Individuals organized the legal system that created the greatest market place in the world? Individuals organized the interstate highway system? The air traffic control system? The system of universal education? Social security?
Individual freedom liberates human energy and creativity but organization creates the environment in which productivity is channeled for societal good
11
"Production - the action of creating something that didn't exist before - is the motor of an economy." is devoid of evidence.
"Government spending takes wealth from those who have it and gives it to those who don't. This is a zero-sum game: the wealth taken does not create jobs, it moves them." is a notion that is oblivious of history. Government spending created vast job growth, and the wealthy prospered too.
Government, our collective expression of will, makes it possible for individuals to innovate. Creation, making something from nothing, is a fairy tale. 14 years of tax cuts for "job creators" has demonstrated the complete and utter failure of the "job creator" myth. Producing something brand new, like a painting, does not drive economies. Producing a product that lacks demand has no value to economies. Henry Ford understood this when he paid his workers enough to be able to afford to buy a Ford. Ayn Rand produced a number of fictional narratives that mesmerized some readers into adulthood. Hayek's ideas should have died with Hoover. Keynes? He was correct and being correct historically is what preserves demand side economic.
"Government spending takes wealth from those who have it and gives it to those who don't. This is a zero-sum game: the wealth taken does not create jobs, it moves them." is a notion that is oblivious of history. Government spending created vast job growth, and the wealthy prospered too.
Government, our collective expression of will, makes it possible for individuals to innovate. Creation, making something from nothing, is a fairy tale. 14 years of tax cuts for "job creators" has demonstrated the complete and utter failure of the "job creator" myth. Producing something brand new, like a painting, does not drive economies. Producing a product that lacks demand has no value to economies. Henry Ford understood this when he paid his workers enough to be able to afford to buy a Ford. Ayn Rand produced a number of fictional narratives that mesmerized some readers into adulthood. Hayek's ideas should have died with Hoover. Keynes? He was correct and being correct historically is what preserves demand side economic.
8
More bad ideas, Karlos. I'm an engineer with a physics background and I can tell you, you just can't ignore one part of a system. Production drives an economy only when there is enough money on the consumption side to buy the production. Ignoring either supply or demand in an economic system is like ignoring gravity when building a skyscraper.
As for this concept of that only people create things and government doesn't you might want to read the first sentence of the Preamble to the constitution or the last line of the Gettysburg Address. Problem is right now the government only represents 1% of the people and is dominated by billions of dollars being spent on Bad Ideas. namely that you can ignore consumption in an economy that is more than 70% consumer driven.
As for this concept of that only people create things and government doesn't you might want to read the first sentence of the Preamble to the constitution or the last line of the Gettysburg Address. Problem is right now the government only represents 1% of the people and is dominated by billions of dollars being spent on Bad Ideas. namely that you can ignore consumption in an economy that is more than 70% consumer driven.
6
Last week the Times posted the story, below. It concerns layoffs at Disney. Americans had to train their H -1B visa replacements. I have been complaining about this for more than a decade. 2001 - 2002 the number of visa's issued for HI - Tech workers went from 65000 to 19500 for both years. I witnessed the brightest, most educated and up to date engineers being walked out one door, their replacements walked in another.
No level of skill can beat out CEO greed when the government supports them. Meritocracy degrades! Kleptocracy rises!
http://www.nytimes.com/times-insider/2015/06/05/disney-layoffs-and-immig...
No level of skill can beat out CEO greed when the government supports them. Meritocracy degrades! Kleptocracy rises!
http://www.nytimes.com/times-insider/2015/06/05/disney-layoffs-and-immig...
31
And the beat goes on
Conservatives seem to take heart in the old Matthew Arnold adage "Women and children, the better ye beat them the better they be."
Conservatives seem to take heart in the old Matthew Arnold adage "Women and children, the better ye beat them the better they be."
12
Osborne is also using this as an exuse for asset-stripping the family silver. He just announced he is selling off the Royal Bank of Scotland, which was bailed out by the taxpayer, at a loss. He sold off the post office at bargain basement rates to his city chums.
Osborne is also selling off the remaining council housing. In London, 70% of new build properties are sold directly to overseas investors as a means of parking their wealth offshore (source: Savills PLC). That means 2-3 new homes must be built for Russian, Chinese, and M.E. investors for any local to even have a chance at home ownership. UK property developers have set up direct sales offices in Hong Kong and the Middle East, so locals never get a look in. For the needy, the rental market in London is desperate, and will only get worse when the remaining council homes are sold off, no doubt to be developed into yet more luxury accomodation for Russian oligarchs.
Osborne is also selling off the remaining council housing. In London, 70% of new build properties are sold directly to overseas investors as a means of parking their wealth offshore (source: Savills PLC). That means 2-3 new homes must be built for Russian, Chinese, and M.E. investors for any local to even have a chance at home ownership. UK property developers have set up direct sales offices in Hong Kong and the Middle East, so locals never get a look in. For the needy, the rental market in London is desperate, and will only get worse when the remaining council homes are sold off, no doubt to be developed into yet more luxury accomodation for Russian oligarchs.
219
Thatcher and Reagan redux: rob the public of investments made by earlier generations for the benefit of all, sell it off to cronies, use the one-time cash flow as tax breaks, then blame the poor for the deficits that result from the loss of long term revenue. I have to admit (reluctantly), the past 30 years has shown this to be political genius.
5
Renters in Council homes have been assessed a "Bedroom Tax" on any excess rooms the council says they have of £25 per month. The tax is assessed yet there are few one bedroom houses or flats available for those who would move. Where council homes are unavailable as in Liverpool people are renting falling down uninspected houses many which of which were boarded up and paying for it with benefit money. With a high unemployment level and inadequate income from work or government benefits people are at their wits end to find housing fit to live in.
NYC housing isn't that great either. The average rent for an apt here is over $3000 a month. Now, you figure out who is able to pay that and why we are becoming a stratified city with the rich (or the very poor) in Manhattan and everyone else moving to the outer boroughs, and even there the rents are kind of nuts.
There's quite a distance between "bad ideas" and campaign rhetoric. The distance is evident in how the winners actually govern.
Where Cameron & Co. pushed emotional buttons just as their recently vanquished opponents did, it remains that Cameron actually governs like a Rockefeller Republican. He's forced to, because the British electorate, regardless of its enthusiasm for blaming someone, would hang not in effigy any politician who sought to seriously attack its social safety protections, such as the National Health Service.
Gordon Brown had very little to do with causing the global financial crisis. Liberal over-spending on kumbaya doesn't cause financial debacles: it merely distracts a people mightily from building a self-sustaining nation, and that in the end affects growth, standards of living and the ability to protect a value framework globally in the teeth of competing and alien frameworks.
Financial debacles are largely caused by inadequate sensible regulation aimed at curbing the more nakedly opportunistic and greedy impulses of man that, when left alone, cause people to risk excessively to make an extra quid. Excessive risk always catches up to us.
But The Professor's disdain for general fiscal prudence in Britain shatters his traditional Keynesian claim that massive deficit stimulus is necessary when times are tough but must be reined when times are good. Clearly, to him massive deficit spending in the interests of kumbaya is ALWAYS necessary.
Where Cameron & Co. pushed emotional buttons just as their recently vanquished opponents did, it remains that Cameron actually governs like a Rockefeller Republican. He's forced to, because the British electorate, regardless of its enthusiasm for blaming someone, would hang not in effigy any politician who sought to seriously attack its social safety protections, such as the National Health Service.
Gordon Brown had very little to do with causing the global financial crisis. Liberal over-spending on kumbaya doesn't cause financial debacles: it merely distracts a people mightily from building a self-sustaining nation, and that in the end affects growth, standards of living and the ability to protect a value framework globally in the teeth of competing and alien frameworks.
Financial debacles are largely caused by inadequate sensible regulation aimed at curbing the more nakedly opportunistic and greedy impulses of man that, when left alone, cause people to risk excessively to make an extra quid. Excessive risk always catches up to us.
But The Professor's disdain for general fiscal prudence in Britain shatters his traditional Keynesian claim that massive deficit stimulus is necessary when times are tough but must be reined when times are good. Clearly, to him massive deficit spending in the interests of kumbaya is ALWAYS necessary.
1
Final paragraph says it all. Krugman is only Keynesian when times are tough. Keynes did not favor deficit spending in boom times.
1
There are times, and they seem to be increasing, when I feel compelled to agree with one of the best contributors to the NYT, even though Richard is clearly on the opposite side of many issues as that far too rare species - a moderate Republican.
Our labour party and the Democratic party over there don't seem to have either the courage to make Dr Krugman's basic argument or the ability to reassure that spending will be curtailed as economic prospects improve.
Many Britons and Americans crave good, moderate government which provides the right circumstances for all to make the most of their opportunities - if only it could be articulated by the sensible left.
Our labour party and the Democratic party over there don't seem to have either the courage to make Dr Krugman's basic argument or the ability to reassure that spending will be curtailed as economic prospects improve.
Many Britons and Americans crave good, moderate government which provides the right circumstances for all to make the most of their opportunities - if only it could be articulated by the sensible left.
1
There are two simple facts that Richard cannot seem to grasp. One is:
The federal government can print money.
The U.S. can never go bankrupt unless we want to. It will run out of money the day after the NFL runs out of points. Now we cannot print arbitrarily large sums ad infinitum. When the economy has achieved its full potential or we have shortages, printing too much money will cause severe inflation. That is certainly not the case today.
The other fact is:
ONLY the federal government can print money.
No one else has a printing press. The population increases. The dollar loses value. The economy grows. As all this happens, the private sector needs more and more money. Only the federal government can provide the new money. The federal deficit measures the net flow of money from the federal gov to people, and businesses. The preferred way to do this is for the government to finance via gross deficits worthwhile projects such as infrastructure repair, education, research, etc. If we do this wisely, we will reap long term benefits and get money in the hands of the people who need it and will spend it, and out of the hands of the people who do not need it and will speculate with it.
What has happened if this fact is ignored? All 6 times we have eliminated deficits long enough to substantially pay down the debt, we have suffered a depression.
The definition of insanity is doing the same thing over and over while expecting different results.
The federal government can print money.
The U.S. can never go bankrupt unless we want to. It will run out of money the day after the NFL runs out of points. Now we cannot print arbitrarily large sums ad infinitum. When the economy has achieved its full potential or we have shortages, printing too much money will cause severe inflation. That is certainly not the case today.
The other fact is:
ONLY the federal government can print money.
No one else has a printing press. The population increases. The dollar loses value. The economy grows. As all this happens, the private sector needs more and more money. Only the federal government can provide the new money. The federal deficit measures the net flow of money from the federal gov to people, and businesses. The preferred way to do this is for the government to finance via gross deficits worthwhile projects such as infrastructure repair, education, research, etc. If we do this wisely, we will reap long term benefits and get money in the hands of the people who need it and will spend it, and out of the hands of the people who do not need it and will speculate with it.
What has happened if this fact is ignored? All 6 times we have eliminated deficits long enough to substantially pay down the debt, we have suffered a depression.
The definition of insanity is doing the same thing over and over while expecting different results.
2
At one time, people who considered such matters were convinced that the world was a flat disk and that over the edges "there dragons be."
In psychologist Robert Cialdini's discussion of the six principles of persuasion, he mentions commitment and consistency. People can, it appears, be easily coerced to commit themselves to a task or cause. His exemplars are California homeowners, unwitting participants in a psychological test, who were each asked to place a massive "Drive Safely" sign on their lawns. Some residents (Group A) had been approached weeks before by a researcher who asked that they display a tiny public safety sign while others (Group B) had not. In Group A, half agreed to virtually obscure their houses with a huge eyesore; nearly none of Group B agreed to the request. Cialdini points out that by making the commitment to the small sign, those in Group A amended their images of themselves to include "community spirited."
Similarly, the British populace has been asked by the Conservative Party to sacrifice in service of a greater good (or so the story goes). Having begun down that path, convincing themselves that even if the country is in desperate shape they're doing this for their children and grandchildren, the voters are likely to become more rather than less committed as things continue to deteriorate.
To misquote Upton Sinclair: "It is difficult to get a man to understand something, when his self-esteem depends on his not understanding it."
In psychologist Robert Cialdini's discussion of the six principles of persuasion, he mentions commitment and consistency. People can, it appears, be easily coerced to commit themselves to a task or cause. His exemplars are California homeowners, unwitting participants in a psychological test, who were each asked to place a massive "Drive Safely" sign on their lawns. Some residents (Group A) had been approached weeks before by a researcher who asked that they display a tiny public safety sign while others (Group B) had not. In Group A, half agreed to virtually obscure their houses with a huge eyesore; nearly none of Group B agreed to the request. Cialdini points out that by making the commitment to the small sign, those in Group A amended their images of themselves to include "community spirited."
Similarly, the British populace has been asked by the Conservative Party to sacrifice in service of a greater good (or so the story goes). Having begun down that path, convincing themselves that even if the country is in desperate shape they're doing this for their children and grandchildren, the voters are likely to become more rather than less committed as things continue to deteriorate.
To misquote Upton Sinclair: "It is difficult to get a man to understand something, when his self-esteem depends on his not understanding it."
237
Jack Mahoney wrote:
"To misquote Upton Sinclair: 'It is difficult to get a man to understand something, when his self-esteem depends on his not understanding it.'"
Indeed, this principle explains why so many in this country continue to vote against their own self-interest: increasingly, the ideology that supports their self-esteem is all they have left.
As Malinowski so cogently stated decades ago, "Situations defined as real are real in their consequences."
"To misquote Upton Sinclair: 'It is difficult to get a man to understand something, when his self-esteem depends on his not understanding it.'"
Indeed, this principle explains why so many in this country continue to vote against their own self-interest: increasingly, the ideology that supports their self-esteem is all they have left.
As Malinowski so cogently stated decades ago, "Situations defined as real are real in their consequences."
1
What is to be done?
While the global .01% pursue their immediate personal financial and political returns, the rest of us and our heirs are going to have to live in the dystopian rubble their policies are creating.
Agitate, organize and educate the rest of the electorate; Some of them are beginning to understand just how stark a future they have planned for the rest of us, as I sit here sweltering in my Manufactured Home with inadequate (broken) air conditioning.
While the global .01% pursue their immediate personal financial and political returns, the rest of us and our heirs are going to have to live in the dystopian rubble their policies are creating.
Agitate, organize and educate the rest of the electorate; Some of them are beginning to understand just how stark a future they have planned for the rest of us, as I sit here sweltering in my Manufactured Home with inadequate (broken) air conditioning.
9
Romney told us that his debate with Obama. Remember when he talked about reviewing his portfolio? Obama's response was that he didn't have what Romney meant by a portfolio. Few of us do.
Romney is smart enough to know that, but he doesn't care. Those without portfolios are non-persons, little people. They are not in his clubs and can't invest in his business, so they don't exist to him.
Romney is smart enough to know that, but he doesn't care. Those without portfolios are non-persons, little people. They are not in his clubs and can't invest in his business, so they don't exist to him.
An important point worth making is worthy of repetition. Professor Krugman is spot on in observing again that "serious" ideas always seems to absolve the powerful of the consequences of their decisions.
Let's make an effort in the US to counter the other "serious" and equally incredible narratives about the origin of the US-led financial crisis. First, we heard that it was the Community Reinvestment Act that caused banks to make subprime loans. When even some of the mainstream banking institutions choked on that whopper, the serious people shifted to accusing profligate poor people egged on by Fannie Mae as the heart of subprime mortgage lending.
Fortunately, in the short window of 2008-2010 we managed to make some important positive changes in our financial regulatory system. There has been shockingly little reporting on the success of this regulation. New credit card regulations have wrung out hundred of billions of dollars in bank fees without any substantial impact on credit access. The new Consumer Financial Protection Bureau has brought a series of amazing enforcement actions returning billions of dollars to consumers in just the first few years of its existence.
The success of this partial re-regulation of the financial system needs to trumpeted, defended and ultimately expanded.
Let's make an effort in the US to counter the other "serious" and equally incredible narratives about the origin of the US-led financial crisis. First, we heard that it was the Community Reinvestment Act that caused banks to make subprime loans. When even some of the mainstream banking institutions choked on that whopper, the serious people shifted to accusing profligate poor people egged on by Fannie Mae as the heart of subprime mortgage lending.
Fortunately, in the short window of 2008-2010 we managed to make some important positive changes in our financial regulatory system. There has been shockingly little reporting on the success of this regulation. New credit card regulations have wrung out hundred of billions of dollars in bank fees without any substantial impact on credit access. The new Consumer Financial Protection Bureau has brought a series of amazing enforcement actions returning billions of dollars to consumers in just the first few years of its existence.
The success of this partial re-regulation of the financial system needs to trumpeted, defended and ultimately expanded.
574
In our passion for justice and retribution we sometimes miss the small victories. Thanks for the reminder.
2
Democrats don't know how to trumpet. Worse still, they don't own the media.
1
Whenever we see conservatives in charge of government, we see a raise in poverty, a rise in the wealth of the 1% and decrease in investment in the infrastructure.
91
Bravo!
One edit might help: Change "Very Serious People" to "Very Sold Out People".
Upton Sinclair wrote: "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"
One edit might help: Change "Very Serious People" to "Very Sold Out People".
Upton Sinclair wrote: "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"
11
Mr. Krubman is often criticized for writing the same story over and over. But I say keep it up Paul! If you tell the truth often enough, people may start to believe it.
21
Since their deregulatory policies helped cause the whole mess in the first place, the VSPs aren't about to admit that "mistakes were made." It might cause them to lose track of all that lethally concentrated wealth and power that they keep sucking and sucking from the body politic.
Blair, Osborne, Cameron, Bush, Greenspan, and yes, Obama and the GOP, are carrying on the seriously evil tradition of Reagan and Thatcher, putting the needs of capital above the needs of the citizens of their allegedly democratic governments. This capital is transnational, thus making it both easy and possible for Obama operative Jim Messina to travel across the pond to re-elect another austerian to power. As made painfully clear by the ongoing Congressional food fight over "trade," greed now trumps national sovereignty.
A servile mass media, owned by the same "folks" who own the politicians, makes the metastatic spread of bad ideas possible. (A case in point is Rupert Murdoch's global empire.) Instead of educating the citizens, they turn struggling people against one another. Divide and conquer works every time. Modern-day racism and xenophobia didn't just spring up on their own. They got help from Fox News.
Instead of getting out and talking to the people whose lives they've helped ruin, leaders function as a paranoid sales crew. The only things they have to offer us are fear and endless wars. They call it "progress."
It doesn't have to be this way. We either fight back, or we perish.
Blair, Osborne, Cameron, Bush, Greenspan, and yes, Obama and the GOP, are carrying on the seriously evil tradition of Reagan and Thatcher, putting the needs of capital above the needs of the citizens of their allegedly democratic governments. This capital is transnational, thus making it both easy and possible for Obama operative Jim Messina to travel across the pond to re-elect another austerian to power. As made painfully clear by the ongoing Congressional food fight over "trade," greed now trumps national sovereignty.
A servile mass media, owned by the same "folks" who own the politicians, makes the metastatic spread of bad ideas possible. (A case in point is Rupert Murdoch's global empire.) Instead of educating the citizens, they turn struggling people against one another. Divide and conquer works every time. Modern-day racism and xenophobia didn't just spring up on their own. They got help from Fox News.
Instead of getting out and talking to the people whose lives they've helped ruin, leaders function as a paranoid sales crew. The only things they have to offer us are fear and endless wars. They call it "progress."
It doesn't have to be this way. We either fight back, or we perish.
130
your letters are lightning bolts. thanks.
3
Deregulation is another nice euphemism they use that means deliberate weakening govt, substituting corporate dominance on lawmaking. Where are good ideas for reinstating specific regulations to restore more equitable power? Spend money on what, reinstate rules and laws to do what?
Start with protecting ordinary consumer banking from wild west investment speculation, requiring taxpayer bailouts. And protect US workers from being displaced by foreign workers on h1b visas. And reinstate realistic wealth tax rates to operate a modern nation.
The US media was a sitting duck for a Murdoch takeover. Laws against monopolies had been conveniently repealed, public media was badly underfunded, and infotainment ruled TV news. I read a comment that said Murdoch’s attempt to buy up media in Germany was stopped. Other countries fund their public media well, since their lawmakers respect it. Here they drive it into the arms of corporations for funding, so it can’t be a counterweight to the vast commercial media complex. An obvious contrast between a good and bad idea.
Public media well funded is a very good idea, not well accepted by our politics. So Al Hunt on PBS could ask Bernie Sanders, “aren’t there any good billionaires?”
Start with protecting ordinary consumer banking from wild west investment speculation, requiring taxpayer bailouts. And protect US workers from being displaced by foreign workers on h1b visas. And reinstate realistic wealth tax rates to operate a modern nation.
The US media was a sitting duck for a Murdoch takeover. Laws against monopolies had been conveniently repealed, public media was badly underfunded, and infotainment ruled TV news. I read a comment that said Murdoch’s attempt to buy up media in Germany was stopped. Other countries fund their public media well, since their lawmakers respect it. Here they drive it into the arms of corporations for funding, so it can’t be a counterweight to the vast commercial media complex. An obvious contrast between a good and bad idea.
Public media well funded is a very good idea, not well accepted by our politics. So Al Hunt on PBS could ask Bernie Sanders, “aren’t there any good billionaires?”
4
See the way the press handles the candidacy of real progressives like Bernie Sanders; that quaint and somewhat crazy old uncle who is politely listened to at dinner parties, and tolerated in the press as a passing fad.
My dream team, Sanders and Warren [VP or Sec Treas] running the country, and Clinton,
Clinton, Obama, and Obama replacing Thomas, Scalia, Alito, and Roberts on the Supreme Court. At least, I hope, that quartet would help overturn Citizens, confirm our inherent rights as people over corporations and religions, and help run the monied interests out of politics nationwide.
My dream team, Sanders and Warren [VP or Sec Treas] running the country, and Clinton,
Clinton, Obama, and Obama replacing Thomas, Scalia, Alito, and Roberts on the Supreme Court. At least, I hope, that quartet would help overturn Citizens, confirm our inherent rights as people over corporations and religions, and help run the monied interests out of politics nationwide.
2
Wash, rinse, repeat. How many versions of the same article can you write Dr. Krugman? We get it. High taxes are good and austerity is bad. You are right, and those who now run the most financially stable major economies in the world are all wrong. How about some new material.
5
The USA, "most stable economy" 2008 doesn't ring a bell? 2001? All other countries in the world are paying for the reckless subprime crisis that originated in the USA. Ever since the laws put in place by President Roosevelt were repealed, the USA economy has been moving from financial crisis to financial crises.
Now, let's just wait for the next one: the student loans subprime crisis. And that's the biggest one we know about....
Now, let's just wait for the next one: the student loans subprime crisis. And that's the biggest one we know about....
14
"Stability" built on the backs of the middle and lower classes. With our ability to support the top 1%-5% steadily being eroded by the massive transfer of wealth upwards, the day may come when those at the top finally realize they've built on sand of their own short-sighted making. I'm not holding my breath.
7
Actually, I was referring more to Germany and England.
1
My belief is that TANSTAAFL is the root of the problem, not to be confused with infrastructure investments. When government spends tax money to increase future tax money, that's just smart.
The dumb part actually goes back to radio. The idea was that we, the suckers, were going to get free radio broadcasts. Of course TANSTAAFL still applies, and the payments came from advertisers, and the same model was evolved and improved for TV and now the Internet.
The real cost is that advertisers want their customers stupid. Smart customers don't respond to advertising in the most convenient way. If the customers are too smart, then they will cluster around the best products with the best values, and the advertising won't matter. What a tragedy!
It took them a while, but now we have government of the stupid lie, and the voters have been trained by stupid advertising to shop and vote as instructed. Works quite well for extremely bad values of "well", at least most of the time--until the country collapses, of course.
The dumb part actually goes back to radio. The idea was that we, the suckers, were going to get free radio broadcasts. Of course TANSTAAFL still applies, and the payments came from advertisers, and the same model was evolved and improved for TV and now the Internet.
The real cost is that advertisers want their customers stupid. Smart customers don't respond to advertising in the most convenient way. If the customers are too smart, then they will cluster around the best products with the best values, and the advertising won't matter. What a tragedy!
It took them a while, but now we have government of the stupid lie, and the voters have been trained by stupid advertising to shop and vote as instructed. Works quite well for extremely bad values of "well", at least most of the time--until the country collapses, of course.
6
From The Hunting of the Snark (Lewis Carroll):
"Just the place for a Snark!" the Bellman cried,
As he landed his crew with care;
Supporting each man on the top of the tide
By a finger entwined in his hair.
"Just the place for a Snark! I have said it twice:
That alone should encourage the crew.
Just the place for a Snark! I have said it thrice:
What I tell you three times is true."
"Just the place for a Snark!" the Bellman cried,
As he landed his crew with care;
Supporting each man on the top of the tide
By a finger entwined in his hair.
"Just the place for a Snark! I have said it twice:
That alone should encourage the crew.
Just the place for a Snark! I have said it thrice:
What I tell you three times is true."
7
"Instead, the story must involve things like a skills gap — it’s not lack of jobs; we have the wrong workers for this high-technology globalized era, etc., etc. — even if there’s no evidence at all that such a gap is impeding recovery."
But such a gap does, in fact, exist. The gap is enormous, too. For the first time in the history of the BLS’ “Job Openings and Labor Turnover Survey (JOLTS)” (started in December 2000), the number of unfilled private-sector job openings exceeded the number of private-sector hires in May.
According to Michael Gregory of BMO Capital Markets:
This speaks to the structural problems in the U.S. labor market such as skills mismatch (due to inadequate training and education), skills deterioration (owing to long-term joblessness) and impinged mobility (perhaps reflecting negative home equity values). Importantly, these things cannot be fixed by super-accommodative monetary policy, and there are limits to how much more further improvement in the labor market the Federal Reserve will want to see before pressing the liftoff button and starting the gradual policy normalization process.
But such a gap does, in fact, exist. The gap is enormous, too. For the first time in the history of the BLS’ “Job Openings and Labor Turnover Survey (JOLTS)” (started in December 2000), the number of unfilled private-sector job openings exceeded the number of private-sector hires in May.
According to Michael Gregory of BMO Capital Markets:
This speaks to the structural problems in the U.S. labor market such as skills mismatch (due to inadequate training and education), skills deterioration (owing to long-term joblessness) and impinged mobility (perhaps reflecting negative home equity values). Importantly, these things cannot be fixed by super-accommodative monetary policy, and there are limits to how much more further improvement in the labor market the Federal Reserve will want to see before pressing the liftoff button and starting the gradual policy normalization process.
2
Is there really a skills gap? I don't think so. What you have is employers who believe they can demand a very exact match at a salary that will not attract those who have such a special set of skills. It's all about the money. Perfect example is the recent story in the NY Times about Disney replacing its IT staff with cheap workers from India.
20
Sorry, you misread the sentence you quote. Krugman is not denying it exists, he's denying that it is impeding recovery. The evidence is in the link provided IN that sentence...one you didn't check out?
7
The fact that businesses have unfilled openings is not evidence of a structural problem in the labor market. This is supposed to show that there are too few workers with a given skill available for businesses at prices they're willing to pay. But "too few" in what sense? If all of the people with skill x who want jobs (and aren't frictionally unemployed) have jobs, then the labor market has cleared. That's a success. The fact that some businesses can't find workers with skill x for below-labor market equilibrium prices doesn't indicate that there's a shortage of such workers. I can't buy luxury goods at a price far below the market clearing price; it's hard to say that that shows there's a shortage of luxury goods in meaningful economic terms. It just means I'm too cheap, like the companies who want cheap workers with specialized skills (who, unlike me, are in a position complain to politicians about creating more STEM graduates to try to change supply curve of the labor market for certain skills).
Structural unemployment really describes unemployment among people with certain skills. If there are any unemployed buggy whip makers still alive who lost their job because of this automobile craze, they would be structurally unemployed. It's interesting why these people don't just accept lower wages in other areas--maybe they're waiting for their industry to rebound? But that's not the same thing as companies offering optimistically low salaries for in-demand skills.
Structural unemployment really describes unemployment among people with certain skills. If there are any unemployed buggy whip makers still alive who lost their job because of this automobile craze, they would be structurally unemployed. It's interesting why these people don't just accept lower wages in other areas--maybe they're waiting for their industry to rebound? But that's not the same thing as companies offering optimistically low salaries for in-demand skills.
6
'Nobody fully understands either why this slump has happened or how to reverse it,'
Everybody in Europe who knows a little bit about cars understands it.
Like: Once upon a time Britain had a car industry - and then it sold every single one of it's car 'jewels' - from the 'Rolls' to the 'Mini' - to Germany - and
Britain put all it's cards on a 'Financial Industry' which majorly collapsed in 2008.
And now Britain is even more than the US the proof that an economy which has to big of a Financial and Service Industry is not sustainable.
And oine might say - it is also a dangerous play for an economy to put nearly all of its' cards on the car industry -(as Germany) - but until now it has played out much better - as an economist once famously should have said - Everything worth producing - is worth producing well!
Everybody in Europe who knows a little bit about cars understands it.
Like: Once upon a time Britain had a car industry - and then it sold every single one of it's car 'jewels' - from the 'Rolls' to the 'Mini' - to Germany - and
Britain put all it's cards on a 'Financial Industry' which majorly collapsed in 2008.
And now Britain is even more than the US the proof that an economy which has to big of a Financial and Service Industry is not sustainable.
And oine might say - it is also a dangerous play for an economy to put nearly all of its' cards on the car industry -(as Germany) - but until now it has played out much better - as an economist once famously should have said - Everything worth producing - is worth producing well!
19
This ignores something that was commonly understood only a few years ago: Britain made lousy cars. They didn't sell. They were poorly engineered.
Germany tried to fix the problems, as when they bought Jaguar and put in BMW electronics. On the whole, Germany lost on those deals.
British industry failed BEFORE it was sold off. It was a social problem, structural. Their wealthy were so coddled that mere engineers and middle class were undercut. They failed in the execution of well conceived ideas. Germany failed to fix that when it bought the problems.
Britain took the money and used it to let their wealthy few play at being wealthy, while the rest of Britain sank.
Germany tried to fix the problems, as when they bought Jaguar and put in BMW electronics. On the whole, Germany lost on those deals.
British industry failed BEFORE it was sold off. It was a social problem, structural. Their wealthy were so coddled that mere engineers and middle class were undercut. They failed in the execution of well conceived ideas. Germany failed to fix that when it bought the problems.
Britain took the money and used it to let their wealthy few play at being wealthy, while the rest of Britain sank.
2
'This ignores something that was commonly understood only a few years ago: Britain made lousy cars.'
How true - but why is your conclusion to sell it off?
The German conclusion is to make 'better cars' and in the case of the Mini -(one of the most succesful models now of BMW it worked very well.
And by the way a factual correction - Ford took over Jaguar and NEVER BMW.
How true - but why is your conclusion to sell it off?
The German conclusion is to make 'better cars' and in the case of the Mini -(one of the most succesful models now of BMW it worked very well.
And by the way a factual correction - Ford took over Jaguar and NEVER BMW.
BMW bought Land Rover. Then Ford bought Land Rover from BMW and merged it with Jaguar which Ford bought elsewhere.
Ford tried to fix the horrid Lucas electrics of the Jaguar with BMW electrics as part of that same deal with BMW. That didn't work out well.
It was all a long time ago and ran together in my head.
The British problem with detail work in engineering is the point. They had some great concepts from their top people, but then the details broke down in the execution. That was a social problem. They didn't have enough engineers and they treated them badly.
I quite agree that the solution is to do better engineering and make a better product.
In practice, we see in the US outsourcing to compete on price alone for really poor quality products. I can't even buy a can opener that will work reliably, for the poor quality materials specified.
Ford tried to fix the horrid Lucas electrics of the Jaguar with BMW electrics as part of that same deal with BMW. That didn't work out well.
It was all a long time ago and ran together in my head.
The British problem with detail work in engineering is the point. They had some great concepts from their top people, but then the details broke down in the execution. That was a social problem. They didn't have enough engineers and they treated them badly.
I quite agree that the solution is to do better engineering and make a better product.
In practice, we see in the US outsourcing to compete on price alone for really poor quality products. I can't even buy a can opener that will work reliably, for the poor quality materials specified.
3
Hmm, why is it that the GOP keep turning surpluses into deficits under their administrations, yet that’s not a “bad” idea until a Democrat takes over and then their deficit hawks come out of the woodwork.
Through the 1980’s our deficits were manageable relative to GDP. After 1980s and two GOP presidents, our deficits exploded.
But according to these GOP deficit hawks, all deficits are “bad”, but did they give Clinton credit when he passed a surplus to them? No way! His surplus belonged to the people (I mean corporations/ wealthy elites) and they wanted that money back as soon as possible.
So in no time flat, Bush became the king of deficits with his 2 wars, 2 tax cuts during time of wars and Medicare Part D. Were Bush’s deficits a "bad" thing? Of course not because they were GOP deficits and the GOP can do no wrong, so they also blew up the economy with the worst recession since the Great Depression. But why stop there. These so called free market capitalists bailed out the Wall St. banks as well.
So the party that supposedly hates deficits bailed out the banks with $800B of our tax dollars without any strings attached while the American people got nothing in return. They also let the corrupt Ratings companies go scot-free, let the foxes guard our Treasury, and let the CEOs get their bonuses.
In hindsight, these were "bad" Ideas. As a result, today we have moral hazard, thanks to the “borrow and spend” GOP and the hypocrisy they promulgate…
http://goo.gl/FpurdD
Through the 1980’s our deficits were manageable relative to GDP. After 1980s and two GOP presidents, our deficits exploded.
But according to these GOP deficit hawks, all deficits are “bad”, but did they give Clinton credit when he passed a surplus to them? No way! His surplus belonged to the people (I mean corporations/ wealthy elites) and they wanted that money back as soon as possible.
So in no time flat, Bush became the king of deficits with his 2 wars, 2 tax cuts during time of wars and Medicare Part D. Were Bush’s deficits a "bad" thing? Of course not because they were GOP deficits and the GOP can do no wrong, so they also blew up the economy with the worst recession since the Great Depression. But why stop there. These so called free market capitalists bailed out the Wall St. banks as well.
So the party that supposedly hates deficits bailed out the banks with $800B of our tax dollars without any strings attached while the American people got nothing in return. They also let the corrupt Ratings companies go scot-free, let the foxes guard our Treasury, and let the CEOs get their bonuses.
In hindsight, these were "bad" Ideas. As a result, today we have moral hazard, thanks to the “borrow and spend” GOP and the hypocrisy they promulgate…
http://goo.gl/FpurdD
58
Spence assumes:
"Debt and the deficit are bad. Reducing them is good."
These are historically wrong..
Every time we had a balanced budget for more than 3 years, that period was immediately followed by a depression. This has happened 6 times. Deficits are necessary for prosperity.
Government deficits decrease private sector debt. All of the 11 recessions we had since 1952 have been preceded by an increase in private sector debt. See 3rd graph at http://www.slideshare.net/MitchGreen/mmt-basics-you-cannot-consider-the-...
In 1946 the debt was 121% of GDP--37% higher than we have today. We had deficits for 21 of the next 27 years; debt increased 75%. And we had prosperity. The GDP grew at an average of 3.8%; real household income surged 74%.
On the other hand look at what happened after WWI. We had balanced budget (surpluses) from 1920 - 1930. We reduced the debt by 38%, On October 29, 1929 the debt was only 16% of GDP. AND THEN WHAT HAPPENED?
As another commenter put it, "A growing economy needs a growing money supply or there will be deflation as X amount of dollars chases greater amounts of goods and services. A fiscal surplus destroys money, exacerbating the problem. Accordingly, regularly running surpluses is like bleeding a patient..."
"The definition of insanity is doing the same thing over and over and expecting different results" - source unknown
"Those who don't know history are destined to repeat it." - Edmund Burke or George Santayana
"Debt and the deficit are bad. Reducing them is good."
These are historically wrong..
Every time we had a balanced budget for more than 3 years, that period was immediately followed by a depression. This has happened 6 times. Deficits are necessary for prosperity.
Government deficits decrease private sector debt. All of the 11 recessions we had since 1952 have been preceded by an increase in private sector debt. See 3rd graph at http://www.slideshare.net/MitchGreen/mmt-basics-you-cannot-consider-the-...
In 1946 the debt was 121% of GDP--37% higher than we have today. We had deficits for 21 of the next 27 years; debt increased 75%. And we had prosperity. The GDP grew at an average of 3.8%; real household income surged 74%.
On the other hand look at what happened after WWI. We had balanced budget (surpluses) from 1920 - 1930. We reduced the debt by 38%, On October 29, 1929 the debt was only 16% of GDP. AND THEN WHAT HAPPENED?
As another commenter put it, "A growing economy needs a growing money supply or there will be deflation as X amount of dollars chases greater amounts of goods and services. A fiscal surplus destroys money, exacerbating the problem. Accordingly, regularly running surpluses is like bleeding a patient..."
"The definition of insanity is doing the same thing over and over and expecting different results" - source unknown
"Those who don't know history are destined to repeat it." - Edmund Burke or George Santayana
6
Len,
No matter how many times you try to link paying off the debt to recessions you are still wrong.
At best you have a weak correlation for the 19th century. Even if you had a correlation of 1 you would just be irrelevant as the America of 2015 is vastly different.
No matter how many times you try to link paying off the debt to recessions you are still wrong.
At best you have a weak correlation for the 19th century. Even if you had a correlation of 1 you would just be irrelevant as the America of 2015 is vastly different.
1
Er Eric, I know I shouldn't reply to Trolls, but the correlation is 1 and not just in the 19th century since the 1920's are not in the 19th century even if the numbers do start with 19.
"The definition of insanity is doing the same thing over and over and expecting different results" - source unknown
"Those who don't know history are destined to repeat it." - Edmund Burke or George Santayana
"The definition of insanity is doing the same thing over and over and expecting different results" - source unknown
"Those who don't know history are destined to repeat it." - Edmund Burke or George Santayana
3
My question for Paul Krugman : Aside from your articles, do you otherwise engage Very Serious People through political actions in role as professor and a journalist? (e.g., on campus debates with conservative colleagues, discussions with other journalists, etc.) This is not a rhetorical question - I really would like to know. Most of your articles are wonderfully informative and well argued, but I fear that they are read mostly by people who already agree with you.
13
The contrary evidence would come from other advanced nations with better equality and priorities. Assertions mean less than positive examples working in other places.
Re the US skills gap hokum ---cite the Disney tech workers doing their jobs just fine at 100,000/year, forced to train their imported foreign replacements paid 60,000/year. Going on for years with other co’s, thus a plunge in income for the dumped Americans, and excess profits for businesses. Thanks to a seriously bad idea by the US congress bowing to corporate donor pressure, to increase h1b visas taking our jobs. This goes directly back to campaign finance—America’s Worst Idea of all. Let’s talk about that.
The UK may have elected austere conservatives, but I’d like to read some effects of it on average income or poor Britons, vs effects on Americans. Generally Cameron’s conservatives are more moderate and sensible than our right wing Gop. Are they privatizing their health care, copying the US by putting corporate profits 1st? How far would they go? Do taxes pay for welfare for full time workers, like Walmart? Better, compare us to EU and Scandinavia.
Campaign austerity? The whole UK election took 3 months total, saving the billions we spend. Most other democracies are sensibly ‘austere’ with public funding, free media time, and strict limits on donations.
You might cite Canada & Australia, who didn’t suffer the 08 crash since they kept banking regulations that the US repealed. Sensible ideas.
Re the US skills gap hokum ---cite the Disney tech workers doing their jobs just fine at 100,000/year, forced to train their imported foreign replacements paid 60,000/year. Going on for years with other co’s, thus a plunge in income for the dumped Americans, and excess profits for businesses. Thanks to a seriously bad idea by the US congress bowing to corporate donor pressure, to increase h1b visas taking our jobs. This goes directly back to campaign finance—America’s Worst Idea of all. Let’s talk about that.
The UK may have elected austere conservatives, but I’d like to read some effects of it on average income or poor Britons, vs effects on Americans. Generally Cameron’s conservatives are more moderate and sensible than our right wing Gop. Are they privatizing their health care, copying the US by putting corporate profits 1st? How far would they go? Do taxes pay for welfare for full time workers, like Walmart? Better, compare us to EU and Scandinavia.
Campaign austerity? The whole UK election took 3 months total, saving the billions we spend. Most other democracies are sensibly ‘austere’ with public funding, free media time, and strict limits on donations.
You might cite Canada & Australia, who didn’t suffer the 08 crash since they kept banking regulations that the US repealed. Sensible ideas.
21
Paul Krugman: "... the ultimate example of a seriously bad idea is the determination, in the teeth of all the evidence, to declare government spending that helps the less fortunate a crucial cause of our economic problems. In the United States, I’m happy to say, this idea seems to be on the ropes, at least for now."
I hope it is, but I won't believe it until Conservatives are out of power in the House and Senate.
The new polls showing a swing to a more liberal leaning voting population are welcome, but they won't mean much in terms of policy until we see the same swing reflected in Congress - a close to insurmountable task given the undemocratic and Un-American nationwide Congressional gerrymandering imposed by Republican state legislatures.
I hope it is, but I won't believe it until Conservatives are out of power in the House and Senate.
The new polls showing a swing to a more liberal leaning voting population are welcome, but they won't mean much in terms of policy until we see the same swing reflected in Congress - a close to insurmountable task given the undemocratic and Un-American nationwide Congressional gerrymandering imposed by Republican state legislatures.
152
If Krugman doesn’t cite some specific evidence that US austerity is “seriously on the ropes”, I’m wondering what he’s talking about. I thought the Recovery went all to the top. On the ropes is glib and unspecific. Some facts, please.
Our mob of Gop candidates may even talk economic equality, but they aim to repeal the New Deal, shrink govt, and they dominate congress. Our infrastructure is still decaying when repairing it could be providing jobs.
The presidential candidate who has specific, good ideas to counter all the bad ideas Krugman laments, is still never mentioned in his columns. Many think Sanders is realistic, but other think he’s too quixotic, and underfinanced by the big money, so doesn’t merit publicity. How much money must a candidate raise before influential liberals take him seriously?
At least Sanders was interviewed on PBS Charlie Rose show, by Al Hunt who asked him, “Aren’t there any good billionaires.”? (Oh, the poor slandered super rich!) Sanders answered by citing the outsized influence of big money on the US govt. Is Krugman familiar with public financing of elections in EU countries? Is he UK privatizing its democracy?
Our worst idea --we spend billions to elect a leader, but most candidates are unresponsive to our needs. And the anointed Democratic candidate doesn’t deign to give us her specific remedies for our economic inequality, the worst among advanced nations. What mediocre ideas will she come up with?
Our mob of Gop candidates may even talk economic equality, but they aim to repeal the New Deal, shrink govt, and they dominate congress. Our infrastructure is still decaying when repairing it could be providing jobs.
The presidential candidate who has specific, good ideas to counter all the bad ideas Krugman laments, is still never mentioned in his columns. Many think Sanders is realistic, but other think he’s too quixotic, and underfinanced by the big money, so doesn’t merit publicity. How much money must a candidate raise before influential liberals take him seriously?
At least Sanders was interviewed on PBS Charlie Rose show, by Al Hunt who asked him, “Aren’t there any good billionaires.”? (Oh, the poor slandered super rich!) Sanders answered by citing the outsized influence of big money on the US govt. Is Krugman familiar with public financing of elections in EU countries? Is he UK privatizing its democracy?
Our worst idea --we spend billions to elect a leader, but most candidates are unresponsive to our needs. And the anointed Democratic candidate doesn’t deign to give us her specific remedies for our economic inequality, the worst among advanced nations. What mediocre ideas will she come up with?
1
Osborne is free to do the full austerity rag now that the Tories have freed themselves from the chains of former coalition partners, the wussy Lib Dems.
Austerity for the lower orders, mind you. Nothing but caviar and champers for the upper class.
The British welfare state had is origins in the poverty and privation that welcomed too many of the soldiers returning from the trenches of the Great War.
In the Second World War the Labour party was the principal instigator of the Beveridge Commission whose report outlined cradle to grave security, a land fit for heroes. And in the 1945 election the British turned away from their magnificent war leader Churchill to elect Labour to build the welfare state.
And despite disastrous economic circumstances, the welfare state was built by Attlee in 1945-1951,
Benefit cutting Tories are undoing this work.
What they may end up doing is dis-uniting the United Kingdom because Scotland, Wales and Northern Ireland said no to the plutocratic vision.
Actually, for the U.S. is a similar disunion might be beneficial if sane American could separate from insane America.
Austerity for the lower orders, mind you. Nothing but caviar and champers for the upper class.
The British welfare state had is origins in the poverty and privation that welcomed too many of the soldiers returning from the trenches of the Great War.
In the Second World War the Labour party was the principal instigator of the Beveridge Commission whose report outlined cradle to grave security, a land fit for heroes. And in the 1945 election the British turned away from their magnificent war leader Churchill to elect Labour to build the welfare state.
And despite disastrous economic circumstances, the welfare state was built by Attlee in 1945-1951,
Benefit cutting Tories are undoing this work.
What they may end up doing is dis-uniting the United Kingdom because Scotland, Wales and Northern Ireland said no to the plutocratic vision.
Actually, for the U.S. is a similar disunion might be beneficial if sane American could separate from insane America.
447
How about productive , responsible Americans separating from
the leaches and irresponsible?
the leaches and irresponsible?
It is too bad the Southern sates that want to secede do not take action to complete the oft expressed desire to do so. The rest of the country without the South would eventually be a more tranquil, educated and less violent place without them. If not all secede, if Texas wen, it would be an improvement, and if Alabama and a few other states joined that pitiful state of Texas, it would be even better.
5
"How about productive , responsible Americans separating from
the leaches and irresponsible?"
Then who will buy the things they import from China?
Those at the top of the economy need an economy on which to be the top. Otherwise, they have nothing either. If they sink us, we all go down together.
the leaches and irresponsible?"
Then who will buy the things they import from China?
Those at the top of the economy need an economy on which to be the top. Otherwise, they have nothing either. If they sink us, we all go down together.
4
The fact is the Continuing Criminal Enterprise known as Faux, the billion dollar disinformation operations of Koch Pollution, Heritage, Cato, AEI, Club for Growth, demonstrate, beyond doubt, that the Big Lie works.
Repeat endlessly that the takers are overwhelming the efforts of the makers, that the problem is lazy, largely minority, people who breed to much, who use too many food stamps, use too much free emergency room care.
Use sleight of hand and rename estate taxes a death tax, government health insurance becomes death panels, the telephone program begun under Reagan morphs to Obama phones. Earned benefits, Social Security and Medicare become the pejorative sounding, dreaded, highway robbery of entitlements.
Repeat endlessly.
Repeat endlessly that the takers are overwhelming the efforts of the makers, that the problem is lazy, largely minority, people who breed to much, who use too many food stamps, use too much free emergency room care.
Use sleight of hand and rename estate taxes a death tax, government health insurance becomes death panels, the telephone program begun under Reagan morphs to Obama phones. Earned benefits, Social Security and Medicare become the pejorative sounding, dreaded, highway robbery of entitlements.
Repeat endlessly.
406
And no one ever, ever mentions the almost Trillion dollar entitlements in the tax code. These entitlements benefit the wealthy, and the nearly rich people who are in the 10%, and are almost never spoken about. These special advantages may seem well meaning, like home mortgage interest deduction for example, but the entitlement is very regressive. Other tax expenditures (look it up) include my company subsidized insurance and retirement programs.
Company health insurance is a particularly bad idea on many levels, putting my employer between my doctor and my health choices and feeding the insurance monster which dominates my state, and insulates me and many others from feeling the full brunt of our dysfunctional health industry. It also places the cost burden on companies, and for many employers gets tangled up in "faith based" discrimination.
Company health insurance is a particularly bad idea on many levels, putting my employer between my doctor and my health choices and feeding the insurance monster which dominates my state, and insulates me and many others from feeling the full brunt of our dysfunctional health industry. It also places the cost burden on companies, and for many employers gets tangled up in "faith based" discrimination.
8
craig - Indeed; GOP'ers invoke the term ' marklar ' constantly:
http://www.urbandictionary.com/define.php?term=marklar
just like they voted 58 times in the House to repeal Obamacare - party lines just like all propagandists promulgate, which are impermeable to reality and serve as litmus tests for purity of ideology.
Thus the U.S. is faced with a gaggle of 2016 GOP'ers who make no mention of the epic wreckage their policies left behind when they were thrown out of office, instead just promising to erase the Obama years and take us all back to the GOP'er glory years of 2001-09, only bigger and worse(erererer).
http://www.urbandictionary.com/define.php?term=marklar
just like they voted 58 times in the House to repeal Obamacare - party lines just like all propagandists promulgate, which are impermeable to reality and serve as litmus tests for purity of ideology.
Thus the U.S. is faced with a gaggle of 2016 GOP'ers who make no mention of the epic wreckage their policies left behind when they were thrown out of office, instead just promising to erase the Obama years and take us all back to the GOP'er glory years of 2001-09, only bigger and worse(erererer).
10
Craig:
Hitler proved the "big lie" works.
Romney's campaign manager insisted that lying didn't matter, so long as most people were willing to believe it.
The horror of a Rush Limbaugh is that generally speaking his logic makes sense, but his diatribes are almost always based on a big lie and go from there.
Fox is the most egregious, but they have spawned plenty of copy cat media efforts, because right wing attitudes apparently "sell" well into the heartland of America.
Strange, ain't it!
Hitler proved the "big lie" works.
Romney's campaign manager insisted that lying didn't matter, so long as most people were willing to believe it.
The horror of a Rush Limbaugh is that generally speaking his logic makes sense, but his diatribes are almost always based on a big lie and go from there.
Fox is the most egregious, but they have spawned plenty of copy cat media efforts, because right wing attitudes apparently "sell" well into the heartland of America.
Strange, ain't it!
3
In the United States, conservatives blame the banking crisis on Barney Frank, who is a convenient scapegoat for conservatives because he happens to be homosexual. Someday, historians will research where the lies that gain currency and distort policy arise in our contemporary society. I suspect that the canard against Barney Frank was first told by a conservative talk radio host. I have a couple of likely suspects in mind as the originators of the lie, but I'll leave it to history to name names.
23
There should be a need to register it before you can spread a falsehood.
1
Recent studies have been released that indicate that a closely held belief when challenged by overwhelming evidence to the contrary results in our holding that 'false' opinion even more firmly a sort of doubling down.
I personally think it accounts for religious fundamentalism in some people and in the case of Dr Krugman's piece here the economic realm. Once we hold a belief as solid, that is it. There is no climate change despite near universal agreement there is among scientists in the field and the data. To justify this belief the science is all a grand conspiracy or rigged in some other way. The examples are numerous and those liberals like myself, do not feel too smug we do the same thing as well it is just right now our closely held beliefs are not front and center regarding challenges. But take the student loan mess as an example in some circles.
I personally think it accounts for religious fundamentalism in some people and in the case of Dr Krugman's piece here the economic realm. Once we hold a belief as solid, that is it. There is no climate change despite near universal agreement there is among scientists in the field and the data. To justify this belief the science is all a grand conspiracy or rigged in some other way. The examples are numerous and those liberals like myself, do not feel too smug we do the same thing as well it is just right now our closely held beliefs are not front and center regarding challenges. But take the student loan mess as an example in some circles.
283
My Grandmother had a saying: Convince a man against his will, he'll be of the same opinion still.
4
This will prove the big story of the last thirty years. Bad ideas
never die and there is no penalty for being wrong. Today's GOP
is illustrative. Supply side, privatizing Social Security, voucherizing
Medicare, means testing of both programs, tax cuts that generate
revenue and pay for themselves, shifting the burden of society
downwards and of course, demonizing the poor.
It works because our corporate lapdog media plays along.
never die and there is no penalty for being wrong. Today's GOP
is illustrative. Supply side, privatizing Social Security, voucherizing
Medicare, means testing of both programs, tax cuts that generate
revenue and pay for themselves, shifting the burden of society
downwards and of course, demonizing the poor.
It works because our corporate lapdog media plays along.
231
It's kind of funny to see Professor Krugman be forced by the right's stubbornness to write about the same things over and over again. It seems that every piece he writes has to do with Republicans refusing to accept the fact that their ideas have failed, and how they continue to put these failed ideas into practice. The reason? Republicans are always refusing to accept that their ideas have failed, and always continue to put their failed ideas into practice. It seems like every day that Republicans are criticizing health care and "big spending", or continually saying that all that's happened in Iraq isn't their fault, when it kinda was. After all the blatant lies, they continue to win election after election because obviously, a bad product, well apologized for will be more popular then one more people would actually like to use. With propaganda machines like Fox News, most Republican citizens will never figure out that they're flat out being lied to.
1119
Gus....totally. A broken record replayed. The rw sets the terms of debate. And they influence much of the Democratic party, Obama, and many pundits to just accept what little we can get. Lousy 2nd rate expensive health care leaving out millions, and lousy 2nd rate financial reform, leaving the banks bigger/more powerful than ever. Liberals play defense.
Once the rw got a hold on the media monopoly of Fox, they influenced all main media to not differ too sharply from the norms the rw set up, lest they sound too liberal. Next, buy off the candidates with campaign money defined as ‘free speech’ to protect profits from taxes. Send jobs out and bring foreign workers in, to lower wages.
With only 2 parties, both needing donors, It’s a proven system for winning elections through propaganda, and for winning a lot on policy even when they lose. Now, Obama is putting more into pushing TPP than anything he’s ever pushed, it seems, despite strong opposition from unions and many of his own party.
Which Wall Streeters will comprise the next president’s cabinet, whoever he or she may be? I’m sure their planning their program now.
Once the rw got a hold on the media monopoly of Fox, they influenced all main media to not differ too sharply from the norms the rw set up, lest they sound too liberal. Next, buy off the candidates with campaign money defined as ‘free speech’ to protect profits from taxes. Send jobs out and bring foreign workers in, to lower wages.
With only 2 parties, both needing donors, It’s a proven system for winning elections through propaganda, and for winning a lot on policy even when they lose. Now, Obama is putting more into pushing TPP than anything he’s ever pushed, it seems, despite strong opposition from unions and many of his own party.
Which Wall Streeters will comprise the next president’s cabinet, whoever he or she may be? I’m sure their planning their program now.
12
Actually, most Republicans will never find out that they're bing lied to because they're undereducated, and ignorant. Sorry, but that's the truth of the Republican base.
Republicans work long and hard to undermine education and critical thinking. They promote the most divisive kind of "us and them" prejudice, because appealing to the basest human instincts works for them. The most ignorant always need to believe they're better than someone else, simply by dint of their skin color, or ethnicity, or religion.
The goal of Republicans elites is always to gin up the base, and get them to vote against their own interests, by convincing them that even though they have nothing else, they have the true religion. In the Republican party, hate and resentment is a powerful vote getter, as long as it's not directed against the one-percent. Then it becomes "class warfare."
Republicans work long and hard to undermine education and critical thinking. They promote the most divisive kind of "us and them" prejudice, because appealing to the basest human instincts works for them. The most ignorant always need to believe they're better than someone else, simply by dint of their skin color, or ethnicity, or religion.
The goal of Republicans elites is always to gin up the base, and get them to vote against their own interests, by convincing them that even though they have nothing else, they have the true religion. In the Republican party, hate and resentment is a powerful vote getter, as long as it's not directed against the one-percent. Then it becomes "class warfare."
25
Its one thing to be lied to but quite another when you are a willing acceptant of the lie or what I would call "willful ignorance".
8
Any idea, once it becomes conventional, has a life of its own. Independence, though much praised, is rarely rewarded, when it comes to thinking. The herd instinct is often more influential than the impact of reality. All the more reason to be grateful for the public career of Paul Krugman.
64
"...seriously bad ideas — by which I mean bad ideas that appeal to the prejudices of Very Serious People..."
The problem is that UK Prime Minister David Cameron is not a very serious person - he is a very trivial person in a very serious job.
The problem is that UK Prime Minister David Cameron is not a very serious person - he is a very trivial person in a very serious job.
82
That is why he was chosen by the very serious people.
8
What Krugman calls "seriously bad ideas" should be studied and understood, because there is often a kernel of truth in those "bad ideas."
Krugman seems to regard as a seriously bad idea the notion that we have a "skills gap,"
"it's not a lack of jobs; we have the wrong workers for this high-technology globalized era,…."
But the skills gap it there, particularly over the long run.
Take the training of medical doctors in the US for example. During the period, 1980-2010 census figures show that the US population grew by 36% while the number of positions in medical schools grew by about HALF that number.
So the US is not training enough medical doctors to keep up with population growth. This in spite of the fact that new technology brings new medical procedures on-line which require MORE not FEWER doctors.
The result is soaring medical costs and shortages. Obamacare made NO PROVISION for additional medical schools, so it just takes a fixed supply of medical care and spreads it among more people.
HMO"s are forced to find "more efficient" ways of delivering medical care. And they do this by providing 5-minute annual exams in which the doctor has NO OPPORTUNITY to consider medical problems that might be developing. And doctors are encouraged to suggest that patients skip cancer screenings which result in thousands of needless deaths.
Most liberals are blind to economic forces which destroy the living standards of Americans in the middle. Including population growth.
Krugman seems to regard as a seriously bad idea the notion that we have a "skills gap,"
"it's not a lack of jobs; we have the wrong workers for this high-technology globalized era,…."
But the skills gap it there, particularly over the long run.
Take the training of medical doctors in the US for example. During the period, 1980-2010 census figures show that the US population grew by 36% while the number of positions in medical schools grew by about HALF that number.
So the US is not training enough medical doctors to keep up with population growth. This in spite of the fact that new technology brings new medical procedures on-line which require MORE not FEWER doctors.
The result is soaring medical costs and shortages. Obamacare made NO PROVISION for additional medical schools, so it just takes a fixed supply of medical care and spreads it among more people.
HMO"s are forced to find "more efficient" ways of delivering medical care. And they do this by providing 5-minute annual exams in which the doctor has NO OPPORTUNITY to consider medical problems that might be developing. And doctors are encouraged to suggest that patients skip cancer screenings which result in thousands of needless deaths.
Most liberals are blind to economic forces which destroy the living standards of Americans in the middle. Including population growth.
6
Sounds like a pretty good argument for single-payer health care and free government sponsored higher education. Republicans have been vociferous champions for both policies, haven't they?
34
That particular problem -- lack of doctors shortage of places in medical school -- can be laid right at the feet of DOCTORS (and their professional organizations, alma maters, etc.).
To maintain very high incomes (most specialists are fully in the 1%), there cannot be too many doctors -- if there WERE adequate doctors for the population, the salaries and perks of doctorhood would go down. Doctors would be like those in other nations -- well-compensated, but not RICH. And American doctors do not go to medical school for 8 years, then apprentice as interns and residents for another 2-5 years ... in order to earn a "good" income. They do so in order to become RICH.
To get adequate numbers of doctors, we need to decouple the concept of doctoring as a profession with "instant 1% rich". And that will be very hard, as nearly all US doctors are some degree of rich (compared to the rest of the population, or even compared to others with similarly rigorous educations).
BTW: I have actually never heard doctors suggesting patients skip cancer screenings, and have no idea what you refer to.
To maintain very high incomes (most specialists are fully in the 1%), there cannot be too many doctors -- if there WERE adequate doctors for the population, the salaries and perks of doctorhood would go down. Doctors would be like those in other nations -- well-compensated, but not RICH. And American doctors do not go to medical school for 8 years, then apprentice as interns and residents for another 2-5 years ... in order to earn a "good" income. They do so in order to become RICH.
To get adequate numbers of doctors, we need to decouple the concept of doctoring as a profession with "instant 1% rich". And that will be very hard, as nearly all US doctors are some degree of rich (compared to the rest of the population, or even compared to others with similarly rigorous educations).
BTW: I have actually never heard doctors suggesting patients skip cancer screenings, and have no idea what you refer to.
4
"Concerned' - I can only speak for myself but you are wrong. Yes there are SOME doctors who have $ in front of their eyes but for the time, effort, delayed gratification, educational expense and overall work load just for school and training to GET INTO practice (my case 13 years after high school, my son in training 16 years for neurosurgery) - just think what riches could be raked in by going into banking or business.
The US doesnt want to spend money on training doctors - we have relied for years on foreign brain drain for 50% of your physician manpower. THEY educate and train them, WE let them in to practice. In the meantime the US taxpayers dont have to help pay for new medical schools or residency training programs (latter paid for in part via medicare). The medical societies and "doctors" dont make those decisions about building schools or funding residency training programs.
Providing non-doctor medical care (nurse practitioners or PAs) helps but IS NOT a complete solution for having enough well trained physicians. We as a society just dont want to have to pay the full bill.
BTW, after 13 years of intense training (which doesnt let up after being in practice - 110 hrs this week on duty for this 62 y/o physician including two 30 hour in- hospital call stretches) what is a "reasonable" income?
The US doesnt want to spend money on training doctors - we have relied for years on foreign brain drain for 50% of your physician manpower. THEY educate and train them, WE let them in to practice. In the meantime the US taxpayers dont have to help pay for new medical schools or residency training programs (latter paid for in part via medicare). The medical societies and "doctors" dont make those decisions about building schools or funding residency training programs.
Providing non-doctor medical care (nurse practitioners or PAs) helps but IS NOT a complete solution for having enough well trained physicians. We as a society just dont want to have to pay the full bill.
BTW, after 13 years of intense training (which doesnt let up after being in practice - 110 hrs this week on duty for this 62 y/o physician including two 30 hour in- hospital call stretches) what is a "reasonable" income?
8
What Krugman calls "seriously bad ideas" should be studied and understood, because there is often a kernel of truth in those "bad ideas."
Krugman seems to regard as a seriously bad idea the notion that we have a "skills gap,"
"it's not a lack of jobs; we have the wrong workers for this high-technology globalized era,…."
But this is partially correct, particularly over the long run.
Take the training of medical doctors in the US for example. During the period, 1980-2010 census figures show that the US population grew by 36% while the number of positions in medical schools grew by about HALF that number.
So the US is not training enough medical doctors to keep up with population growth. This in spite of the fact that new technology brings new medical procedures on-line which require MORE not FEWER doctors.
The result is soaring medical costs and shortages. Obamacare made NO PROVISION for additional medical schools, so it just takes a fixed supply of medical care and spreads it among more people.
HMO"s are forced to find "more efficient" ways of delivering medical care. And they do this by providing 5-minute annual exams in which the doctor has NO OPPORTUNITY to consider medical problems that might be developing. And doctors are encouraged to suggest that patients skip cancer screenings which result in thousands of needless deaths.
Most liberals are blind to economic forces which destroy the living standards of Americans in the middle. Including population growth.
Krugman seems to regard as a seriously bad idea the notion that we have a "skills gap,"
"it's not a lack of jobs; we have the wrong workers for this high-technology globalized era,…."
But this is partially correct, particularly over the long run.
Take the training of medical doctors in the US for example. During the period, 1980-2010 census figures show that the US population grew by 36% while the number of positions in medical schools grew by about HALF that number.
So the US is not training enough medical doctors to keep up with population growth. This in spite of the fact that new technology brings new medical procedures on-line which require MORE not FEWER doctors.
The result is soaring medical costs and shortages. Obamacare made NO PROVISION for additional medical schools, so it just takes a fixed supply of medical care and spreads it among more people.
HMO"s are forced to find "more efficient" ways of delivering medical care. And they do this by providing 5-minute annual exams in which the doctor has NO OPPORTUNITY to consider medical problems that might be developing. And doctors are encouraged to suggest that patients skip cancer screenings which result in thousands of needless deaths.
Most liberals are blind to economic forces which destroy the living standards of Americans in the middle. Including population growth.
6
Bret, perhaps the reason we don't have more doctors is the staggering cost of medical school. I don't believe your doc gives you a five minute exam, my physical took more than an hour this year, and I had blood drawn and X-rays for no additional cost. As for economic forces destroying the middle class, easily solved, hit the richest of the rich with higher taxes.
68
Bret never looks at the data. As I have pointed out to him ad nauseam, there IS overwhelming data that the law of supply and demand does not apply to health care in the US. The best paid doctors, the most expensive health care, the longest waits are all in those areas with the highest density of physicians.
From the organization that provides much of the data:
http://www.dartmouthatlas.org/keyissues/issue.aspx?con=2940
"Increasing the number of physicians will make our health care system worse, not better. First, unfettered growth is likely to exacerbate regional inequities in supply and spending; our research has shown that physicians generally do not choose to practice where the need is greatest. Second, expansion of graduate medical education would most likely further undermine primary care and reinforce trends toward a fragmented, specialist-oriented health care system. Current reimbursement systems strongly favor procedure-oriented specialties, and training programs would almost certainly respond to these incentives. Third, workforce expansion will be expensive. If outcomes and patients' perception of access improved as supply increased, then we could debate whether an expansion of training offers better value than investments in preventive care, disease management, or broader insurance coverage, which have known benefits. Instead, the costs of expansion will limit the resources available for necessary reform efforts without any evidence-based promise of a benefit."
From the organization that provides much of the data:
http://www.dartmouthatlas.org/keyissues/issue.aspx?con=2940
"Increasing the number of physicians will make our health care system worse, not better. First, unfettered growth is likely to exacerbate regional inequities in supply and spending; our research has shown that physicians generally do not choose to practice where the need is greatest. Second, expansion of graduate medical education would most likely further undermine primary care and reinforce trends toward a fragmented, specialist-oriented health care system. Current reimbursement systems strongly favor procedure-oriented specialties, and training programs would almost certainly respond to these incentives. Third, workforce expansion will be expensive. If outcomes and patients' perception of access improved as supply increased, then we could debate whether an expansion of training offers better value than investments in preventive care, disease management, or broader insurance coverage, which have known benefits. Instead, the costs of expansion will limit the resources available for necessary reform efforts without any evidence-based promise of a benefit."
25
It is a mistake, Bret, to place much importance on a temporary imbalance in the supply of professionals in a field where the need for services is determined by someone other than the would-be recipients. That has been true in medicine at least since 1967.
There are other professional fields, like law, where the number of practitioners often grows itself. There is an old story is about the small town where there was only one lawyer. He could not drum up enough business to feed his family until a second lawyer moved to town, and they both got rich.
There are other professional fields, like law, where the number of practitioners often grows itself. There is an old story is about the small town where there was only one lawyer. He could not drum up enough business to feed his family until a second lawyer moved to town, and they both got rich.
6
George Osborne (Exchequer) has said: "Britain should have a law requiring that the government run a budget surplus — with current revenue paying for all spending, including investment outlays — when the economy is growing."
Key term being 'when the economy is growing'. How is this a bad idea? Even J.M. Keynes and Krugman the Economist (not Krugman the pundit) think this is a good idea. Keynesian Counter Cyclical fiscal policy says: the government should undertake deficit spending when an economy is in recession, and either and cut spending during boom times.
Funny how George Osborne is truer to Keynes than self styled 'modern interpreter of Keynes' Krugman.