a recent New York Times post, Krugman proclaims that "Deficits saved the world." The unspoken logic is pretty clear, and inside Krugman states, "government deficits... are the only thing that has saved us from a second Great Depression."
The unspoken logic is pretty clear. Since Obama must be given credit for saving the world, and saving America from a second depression... and the only thing Obama has done is run up a huge deficit... the new line of argument has to be that "Deficits saved America and the World from a second Great Depression."
This has two advantages.
One it allows liberals to re-characterize Obama's spending spree as preventing a depression. The old tagline was, "You have to spend money to make money." Then when no money was made and jobs kept on being lost, the new tagline becomes, "If the government doesn't stop spending money, there'll be no more money."
Count on Joe Biden to put it simply and best,
“We’re going to go bankrupt as a nation,” Biden said. “Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt? The answer is yes, that's what I’m telling you."
If the GOP has any sense, they'll be running that clip of Biden in commercials non-stop in 2010 and 2012 to highlight the sheer insanity of the Obama administration's policy of amassing impossible amounts of debt to avoid bankruptcy, incidentally exactly the same sort of economics that helped created the crisis in the first place.
At this point even if 50 percent of the country is unemployed and every major corporation in America has moved overseas, and the American taxpayer has signed up a debt even his great-great-great-grandchildren won't be able to repay, so long as the government and the media insist there is no Great Depression, Obama will be able to proclaim victory over the economy.
And of course it will be a victory over the economy indeed. But the Krugmanites will point to economic indicators, and claim that recovery is just around the corner thanks to Obama and Geithner's wise policy of wasting huge amounts of money, and raising taxes to pay for it.
Naturally like Lysneko, Krugman's "Imaginary Economics" doesn't work in real life, and is reshaped to the occasion. Under Bush, Krugman was not a fan of deficits. Instead he penned multiple columns blaming Bush's tax cuts for driving up the deficit. Of course now deficits that are many times the size of Bush's deficits will be the savior of us all. And we have always been at war with Oceania.
The message was Deficit + Bush Tax Cuts = Will Doom Us All. But now, Deficit + Irresponsible Government Spending = Will Save Us All. That is the kind of math you get a Nobel prize for, that is if you're lucky enough to be dealing with a Lysenkoist Nobel Prize Committee that was willing to reward anyone opposed to Bush with a Nobel Prize, (see Carter, Jimmy and Gore, Al).
Tax cuts of course are bad, because how can you pay for your deficit spending without them. Deficit spending itself however is now good, because it will help force new taxes, which has been Krugman's crusade for a while now, labeling anyone opposed to government taxation as irrational fanatics, an assertion in which he presumably includes America's Founding Fathers.
Of course if anything the Obama Administration has demonstrated just the opposite, showing that government can spend money more foolishly and destructively, than even the most imprudent taxpayer, and can do so on a far larger scale. Liberals who embrace Krugman, the way that Communists embraced Lysenko, do so because he tells them what he wants to hear, that Congress robbing the public to pay for its own pork is the best possible economic behavior.
The Soviet Union's leaders believed that they could prove themselves superior to nature. They claimed that they had scientists on their side, when in reality they had politically connected frauds who served as their echo chamber. The result was famine, constant shortages, misery and failure on every front. Under the watch of the Lysenkoists and on the orders of the Bolsheviks, Ukraine, once the region's breadbasket went from productive to dead. The Soviet Union's own humiliating collapse began as from on Khrushchev onward, the USSR became dependent on grain imports from the US, allowing America to influence Soviet policy.
Obama's economics of centralized government, of wealth redistribution and endless cycles of spending backed by taxation leads to the same place, as the Collective Farms, the central economic planning and the Dictatorship of the Proletariat did. The Soviet Union believed that it would control everything, but the more they attempted to control, the less they had to control.
The utopian ideals of collective farming gave way to the harsh reality of a new serfdom. Centralized planning made sure that corruption and inefficiency were distributed from the top down through a long bureaucratic chain in which everyone took their cut, and no one was responsible, except for the scapegoats.
The logic of centralization and serfdom was wrong then, and it is wrong now. Individual economic activity is more profitable and efficient, than centralized activity. People work better for themselves, than they do for governments and unions. Free power beats Slave power every time, a fundamental value that the Republican party has embraced from Lincoln to Reagan, and one that the Democratic party threw overboard when they exchanged Jefferson for FDR.
Krugman's agenda, Obama's agenda, is nothing more than a slow path to socialism, implemented by implementing the socialist system on top of the existing economic system. It is the same old disaster of feeding everything and everyone into the great big machine of government, and expecting it to somehow spit out Utopia. A plan that fails every time.
An Army officer in Vietnam said, "In order to save the village, we had to destroy the village." The new Obama economic agenda is, "We must destroy the economy in order to save the economy." The truth is that what the economy needs to be saved most of all... is from them.