This is disingenuous even for him.
First, though, I have not explained recently why I single out Krugman. The reason is simple: as the messenger of economically disastrous–and lunatic– policies, as a “thinker” (actually, why don’t we insert “ideological activist” within those brackets?) who has a wide audience, he is arguably the single most dangerous non-politician in the country. Certainly, his name needs to appear on a short list that includes George Soros, and the elitists Obama has gathered around him to do everything they can to impose through fiat what they cannot get legislated.
If the task is job creation, the private sector does that. Is it smarter to take their money, spend it on pet projects favored by people who have never had jobs, then hope it trickles back to them; or does it make more sense to make more capital available to the people who use it to fund business growth and the jobs that go with it? Your answer literally speaks to your capacity for the use of reason.
I want to be clear: if the task is to eradicate all competitors to the Ivy League-ish, Fabian, morally weak but intellectually dogmatic people who think they are privy to a uniquely valuable understanding of how the world “really works”, then Keynesian economics works. The task JMK set himself was eroding private wealth and economic and personal liberty, under the cloak of helping increase private wealth and liberty. You see, these people are liars and liars lie. That’s what they do. That is the sort of statement that has become difficult to make in our post-rational age.
Anyway, Keynes–strike that, Krugman–hits all the usual suspects: tax cuts, war with Iraq, deregulation. These have by now become for synchronized leftists become little more than trigger points. They spasm when he says how high. They lie when he says tell the truth. They are perfectly trained.
But in the world most of us occupy, in which fact and reason are studied judiciously to develop statements which conform well to visible reality, Krugman is simply wrong.
The Bush tax cuts increased dramatically the share of taxes paid by the rich. They weren’t tax cuts at all. That demographic paid more. In most cases, presumably they paid more because they made more. They made more since they engaged in more economically productive activity. That activity is what creates jobs.
Net revenues to the government also went up under Bush. None of the irrationalists who want to pretend Keynes was other than deviant moral monster (exhibit A is his close relationship with George Bernard Shaw) ever take not of what actual receipts are. Deficits go up because WE SPEND MORE MONEY. If you increase you income 10%, and increase your spending 20%, is it the part of reason to argue that the increase in income was bad? Of course not.
War on Iraq: yes, it was expensive. So too has been the War on Poverty. The difference is that we won in Iraq, and we have been losing the War on Poverty since it was launched. I see no way of believing, on the contrary, that it has not played a major role in the IMPOVERISHMENT of large segments of our nation. Where two parent families were the norm, now they are gone.
Krugman won’t discuss this. Of course, he could: he seemingly has no moral compass or particular attachment to actually helping improve the lives of ordinary, normal people, so no doubt he can spin failure into genius, and horror into excitement.
Finally, the Great Recession. How did it start? The failure of Fannie Mae and Freddie Mac. Significance? They backed a very large segment of the mortgage-backed securities whose belated devaluation by the Credit Rating Agencies provoked the cash flow crisis that created the larger problem. The whole reason the Credit Ratings Agencies were able to pretend that securities of unknown and unknowable value were golden is that they were backed by, what? The full faith of the Federal Government. Bail-outs were promised to all.
The government ENABLED the crisis.
I will frankly never really understand how people like Krugman look in their mirrors with other than naked self loathing. He is not working to help the lives of anyone. He is protecting a fundamentally corrupt system–characterized by Central Banks who are only too happy to support his frequent calls for more spending, since they can print the money to make it happen–while offering nothing that will help John Q. Average on the street.