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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsKrugman Schools 'Morning Joe' on Austerity: 'How Many Times' Do I Have to Be Right?
Nobel prize-winning economist Paul Krugman on Monday attempted to give the panelists on MSNBC's Morning Joe a lesson about why austerity and drastic spending cuts were the wrong solution in tough economic times.
"Our track record is actually not bad, we've tended to reduce our debt at least relative to GDP when the economy was strong," Krugman told host Joe Scarborough. "We tend to increase when the economy is week, but that's what you should do. So this is not a hard call. I mean, as long as we have four million people who have been unemployed for more than a year, this is not a time to be worrying about reducing the budget deficit. Give me something that looks more like a normal employment situation and I'll become a deficit hawk, but not now."
"I think we can begin to address our entitlement problems without putting on the brakes, without austerity," Council on Foreign Relations President Richard Haass asserted. "If we don't, what worries me about what people like Paul Krugman and others are recommending is we leave ourselves incredibly vulnerable to higher interest rates, to future Hurricane Sandys, to future wars, to bond markets, that we put ourselves in an incredibly vulnerable position."
"Washington doesn't work that way," Krugman pointed out. "If you spend a lot of your time talking about the debt and the entitlements are the big problem, the message that actually what we need to is promote jobs gets lost. And in fact, we spent the last two and a half years focused entirely on arguing about the long-term deficit and entitlements and doing nothing for employment right now. That balance has got to shift."
http://videocafe.crooksandliars.com/david/krugman-schools-morning-joe-austerity-how-ma
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Sherman A1
(38,958 posts)
bvar22
(39,909 posts)Unless our nation does something to reverse the flow of Good American Jobs to 3rd World Slave Labor countries through our "Free Trade" policies,
we will never again have a "Good Economy",
and MORE "Free Trade" is on the agenda for this term.
There is No Such Thing as "Free Trade".
There is no Such Thing as "Free Markets",
and there is No Invisible Hand.
The Rich and Powerful made that shit up so that they can make MORE money for the CEOs and "Investors" by ducking Human Rights, Worker Rights, and Environmental Regulation.
Capital (Money) will ALWAYS be able to outrun Human Rights and Environmental Regulation.
The Corporate Owners can pack up and move overnight to feed off of next 3rd World Slave Country,
while it takes Human Rights, LABOR, and Environmental Protectors YEARS, or DECADES to organize, petition governments, and effect adequate regulation.
If you Work for a Living do NOT trust ANYBODY who espouses a belief in "Free Trade", "Free Markets", or a Giant Invisible Hand."
None of those exist, and that person is NOT your friend.
Angry Dragon
(36,693 posts)ErikJ
(6,335 posts)The SS Trust Fund has a surplus of $2.6 trillion and has been conveniently included as revenue for the govt general fund since Reagan when the SS Trust Fund started to grow.
Its a good deal for the top 1% because they dont have to pay SS taxes on anything they make over $110,000. So it is really a tax on the 95% to balance the national budget.
Its not a coincidence that Reagan doubled the SS tax (on the 95%) while he cut the top tax rate from 70% to 28%.
Spitfire of ATJ
(32,723 posts)The pundits act like it's the gold standard of how to solve all of our problems.
It was described at the time it first was released as "The Cat Food Commission" because it calls for deep cuts in Social Security and Medicare. Since then we have seen Democrats use it as the sensible fallback reference since it's recommendations are considered to be well thought out and sensible.
Krugman mocked it. Something very rare on TV today. He said, "...they can't even get their own commission to agree on the report and you say this should be our policy?"
Chakab
(1,727 posts)Simpson/Bowles horseshit so hard? As Krugman pointed out, the commission never agreed to anything. Their plan is just the opinion of two plutocrats about how best to fuck the poor and middle class.
GreenTea
(5,154 posts)of to Fox 'news' and the other goofy, absolutely know-nothing republican mainstream media talking heads.
bvar22
(39,909 posts)Why is it that the "experts" who have been proved wrong on EVERYTHING from the Economy to the Iraq War are promoted to positions of POWER in the administration, while those who have been RIGHT on everything (Iraq, Military Spending, Civil Liberties, Drones, Free Trade, Single Payer Health Care, Government Spending, and the Economy, ...) are excommunicated from The Party or marginalized and silenced as "Fucking Retards" or the Fringe Left Wing? 
Inquiring minds want to know!
You will know them by their WORKS,
not by their rhetoric, promises, or excuses.
[font size=5 color=green]Solidarity99![/font][font size=2 color=green]
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rhett o rick
(55,981 posts)Building wealth, which would help us all, is harder than stealing wealth. And collectively, the USofA middle class still has a lot of wealth to steal. The golden goose still has a few eggs to give before it expires.
lark
(23,065 posts)Obama and many in congress are too thick with the wall st types and are pushing this meme of reducing SSI (chained CPI) and putting raising the age for Medicare on the table. Wish they would listen to Krugman instead of the Geithners & Summers & Bowles of the world.
madokie
(51,076 posts)At least there will be some who can hear what you say, Joe isn't one of them though
dkf
(37,305 posts)If he is right, but we don't follow his prescription then we muddle around longer but the downside risk isn't as bad.
Jim Lane
(11,175 posts)Krugman's point is that concern over the deficit is backed up by predictions of hyperinflation and skyrocketing interest rates. We've been seeing those predictions regularly and they've been false.
The fact is that, from the end of World War II until the Reagan Administration, the total federal debt, expressed as a percentage of GDP, was steadily reduced. It went up under Reagan and Bush 41, resumed its decline under Clinton, but then rebounded under Shrub. It's still below where it was in 1945.
Please proceed
(59 posts)Joe must have been one lousy student, seems he forgot everything the professor taught him yesterday and was back beating the "deficit is the biggest threat drum" today.
He did mention jobs but as a side issue. In fact he stated that deficit reduction and jobs could be done simultaneously.
Declaring "We can do two things at the same time!!", he proudly stated his case. Yes Joe, but putting the car in reverse and stomping on the gas can be done at the same time too, but it does little to help move the car forward.
hughee99
(16,113 posts)"Give me something that looks more like a normal employment situation and I'll become a deficit hawk, but not now."
In 2006, with unemployment below 6 (http://data.bls.gov/timeseries/LNS14000000), he was suggesting that if the government were able to free up money (from shutting down the wars, for example) they should spend it rather than using it to keep the deficit down.
"The answer, I now think, is to spend the money - while taking great care to ensure that it is spent well, not squandered - and let the deficit be. By spending money well, Democrats can both improve Americans' lives and, more broadly, offer a demonstration of the benefits of good government. Deficit reduction, on the other hand, might just end up playing into the hands of the next irresponsible president. "
http://economistsview.typepad.com/economistsview/2006/12/paul_krugman_de.html