Krugman: GOP’s Economy Strategy Is ‘Gigantic Con Game’

I’ve got a sort of geeky crush on Paul Krugman, mainly because he interprets our economic situation from a slightly left perspective and his presentation is actually comprehensible.

The New York Times

So the Republican electoral strategy is, in effect, a gigantic con game: it depends on convincing voters that the bad economy is the result of big-spending policies that President Obama  hasn’t followed (in large part because the G.O.P. wouldn’t let him), and that our woes can be cured by pursuing more of the same policies that have already failed.

For some reason, however, neither the press nor Mr. Obama’s political team has done a very good job of exposing the con.

What do I mean by saying that this is already a Republican economy? Look first at total government spending — federal, state and local. Adjusted for population growth and inflation, such spending has recently been falling at a rate not seen since the demobilization that followed the Korean War.

How is that possible?  Isn’t Mr. Obama a big spender? Actually, no; there was a brief burst of spending in late 2009 and early 2010 as the stimulus kicked in, but that boost is long behind us. Since then it has been all downhill. Cash-strapped state and local governments have laid off teachers, firefighters and police officers; meanwhile, unemployment benefits have been trailing off even though unemployment remains extremely high.

Over all, the picture for America in 2012 bears a stunning resemblance to the great mistake of 1937, when F.D.R. prematurely slashed spending, sending the U.S. economy — which had actually been recovering fairly fast until that point — into the second leg of the Great Depression. In F.D.R.’s case, however, this was an unforced error, since he had a solidly Democratic Congress. In President Obama’s case, much though not all of the responsibility for the policy wrong turn lies with a completely obstructionist Republican majority in the House.

That same obstructionist House majority effectively blackmailed the president into continuing all the Bush tax cuts for the wealthy, so that federal taxes as a share of G.D.P.  are near historic lows — much lower, in particular, than at any point during Ronald Reagan’s presidency.

As I said, for all practical purposes this is already a Republican economy.

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3 Comments

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3 responses to “Krugman: GOP’s Economy Strategy Is ‘Gigantic Con Game’

  1. Ted

    The Republican ‘collective brain’ appears to be the organ they use to think that they think. Unfortunately, it isn’t doing any thinking.

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  2. mhasegawa

    I caught a snipet of discussion on public radio the other day and someone pointed out that the private sector was still creating jobs albeit slowly, but the increase in unemployment is government workers being laid off.

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    • Hi Mhasegawa, that sounds about right. GOP Governors across the country are laying off state workers in droves. Even Obama laid off a substantial amount of Federal employess two years ago.

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