Winning that Nobel Prize must’ve gotten to Paul Krugman’s head… Either that or he is interested in a job with the Obama administration.
He thinks the $9 trillion deficit over the next decade is quite all right. In fact, he thinks we need more!
In fact, we would be better off if governments were willing to run even larger deficits over the next year or two. The official White House forecast shows a nation stuck in purgatory for a prolonged period, with high unemployment persisting for years. If that’s at all correct — and I fear that it will be — we should be doing more, not less, to support the economy.
So he realizes the threat of persisting unemployment, yet he’s recommending higher government spending. I gather he proposes creating more government jobs to support the economy? That won’t turn out too well. New jobs are needed in the private sector where corporations and small businesses can drive the economy. More government jobs only means a heavier burden on companies and the workers in the private sector.
And this ought to make Americans feel much better, by comparing our economy to Belgium and Italy:
The numbers tell you why. According to the White House projections, by 2019, net federal debt will be around 70 percent of G.D.P. That’s not good, but it’s within a range that has historically proved manageable for advanced countries, even those with relatively weak governments. In the early 1990s, Belgium — which is deeply divided along linguistic lines — had a net debt of 118 percent of G.D.P., while Italy — which is, well, Italy — had a net debt of 114 percent of G.D.P. Neither faced a financial crisis.
Come on, Mr. Krugman. By comparing us to the Italians, you know we’re in poor shape! Italy consistently lags behind in the European Union in terms of economy. And Belgium’s unemployment rate is normally above 8% — not something to be proud of, is it?
In conclusion, Mr. Krugman just had to bring up health care reform. I knew there was a hidden agenda:
As I’ve said, those 10-year projections aren’t as bad as you may have heard. Over the really long term, however, the U.S. government will have big problems unless it makes some major changes. In particular, it has to rein in the growth of Medicare and Medicaid spending.
That shouldn’t be hard in the context of overall health care reform. After all, America spends far more on health care than other advanced countries, without better results, so we should be able to make our system more cost-efficient.
I’m guessing he has a few pitchers of Obama’s kool-aid in his fridge. Notice the low blow about our current health care system “without better results.” Why don’t you tell that to the Canadians and Brits who are crossing into America to get medical treatment? It’s good thing Krugman is an economist and not health care administrator.
