RE: [MLUG - DISCUSSION] [POLITICS] Krugman on the economy

["Hargus, Diana" <EMAIL:PROTECTED>]

> -----Original Message-----
> From: EMAIL:PROTECTED [mailto:discussion-
> EMAIL:PROTECTED] On Behalf Of Mike Miller
> Sent: Tuesday, January 08, 2008 9:41 AM
> To: MLUG discussion
> Subject: [MLUG - DISCUSSION] [POLITICS] Krugman on the economy
> 
> See the Krugman article below.  Here's some supporting material:
> 
> http://krugman.blogs.nytimes.com/2008/01/06/charts-for-17-column/
> http://krugman.blogs.nytimes.com/2008/01/07/another-jobs-picture-
> europe-vs-us/
> 
> Obviously, things went better with the Clinton policy than with the
> Bush
> policy, but one cannot unambiguously attribute the results to the
> policies.  What one can do is point out that there is no evidence in
> the
> data for the superiority of the Bush policy, and the evidence strongly
> favors the Clinton policy.
> 
> A different kind of data would show the superiority of the Bush policy
> at
> achieving its real aim:  To concentrate power among the wealthiest
> Americans.  At this it has been massively successful.
> 
> Now it looks like we're headed for a recession, but don't blame Bush
> because he had only "a B in Econ 101" (but an "A" in making the rich
> richer):
> 
> http://thinkprogress.org/2007/09/20/bush-econ101/
> 
> And he hired a spokesman who is either lying about the probable
> upcoming
> recession or living under a rock:
> 
> http://thinkprogress.org/2008/01/07/fratto-recession/
> 
> I suppose he's just lying.  After all, isn't the job description
> "professional liar" (yes, also for Democrat spokesmen).

Um, Mike?  Shouldn't that, like, be for most politicians?

Diana

> Mike
> 
>
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> ---
> 
> 
> http://www.nytimes.com/2008/01/07/opinion/07krugman.html
> 
> N.Y. Times
> January 7, 2008
> 
> Op-Ed Columnist
> 
> >From Hype to Fear
> 
> By Paul Krugman
> 
> The unemployment report on Friday was brutally bad. Unemployment rose
> in
> December, while job creation was minimal -- and it's highly likely,
for
> technical reasons, that the job number will be revised down, showing
an
> actual decline in employment.
> 
> It's the latest piece of bad news about an economy in which the
> employment
> situation has actually been deteriorating for the past year. It's no
> longer possible to hope that the effects of the housing slump will
> remain
> "contained," as one of 2007's buzzwords had it. The levees have been
> breached, and the repercussions of the housing crisis are spreading
> across
> the economy as a whole.
> 
> It's not certain, even now, that we'll have a formal recession,
> although
> given the news on Friday you have to say that the odds are that we
> will.
> But what is clear is that 2008 will be a troubled year for the U.S.
> economy -- and that as a result, the overall economic record of the
> Bush
> years will have been dreary at best: two and a half years of slumping
> employment, three and a half years of good but not great growth, and
> two
> more years of renewed economic distress.
> 
> The November election will take place against that background of
> economic
> distress, which ought to be good news for candidates running on a
> platform
> of change.
> 
> But the opponents of change, those who want to keep the Bush legacy
> intact, are not without resources. In fact, they've already made their
> standard pivot when things turn bad -- the pivot from hype to fear.
And
> in
> case you haven't noticed, they're very, very good at the fear thing.
> 
> You see, for 30 years American politics has been dominated by a
> political
> movement practicing Robin-Hood-in-reverse, giving unto those that hath
> while taking from those who don't. And one secret of that long
> domination
> has been a remarkable flexibility in economic debate.  The policies
> never
> change -- but the arguments for these policies turn on a dime.
> 
> When the economy is doing reasonably well, the debate is dominated by
> hype
> -- by the claim that America's prosperity is truly wondrous, and that
> conservative economic policies deserve all the credit.
> 
> But when things turn down, there is a seamless transition from "It's
> morning in America! Hurray for tax cuts!" to "The economy is slumping!
> Raising taxes would be a disaster!"
> 
> Thus, until just the other day Bush administration officials were in
> denial about the economy's problems. They were still insisting that
the
> economy was strong, and touting the "Bush boom" -- the improvement in
> the
> job situation that took place between the summer of 2003 and the end
of
> 2006 -- as proof of the efficacy of tax cuts.
> 
> But now, without ever acknowledging that maybe things weren't that
> great
> after all, President Bush is warning that given the economy's
problems,
> "the worst thing the Congress could do is raise taxes on the American
> people and on American businesses."
> 
> And even more dire warnings are coming from some of the Republican
> presidential candidates. For example, John McCain's campaign Web site
> cautions darkly that "Entrepreneurs should not be taxed into
> submission.
> John McCain will make the Bush income and investment tax cuts
> permanent,
> keeping income tax rates at their current level and fighting the
> Democrats' plans for a crippling tax increase in 2011."
> 
> What "crippling" tax increase, which would tax entrepreneurs into
> submission, is Mr. McCain talking about? The answer is, proposals by
> Democrats to let the Bush tax cuts for people making more than
$250,000
> a
> year expire, returning upper-income tax rates to the levels that
> prevailed
> in the Clinton years.
> 
> And we all remember how little entrepreneurship there was, how weakly
> the
> economy performed, during the Clinton years, right? Oh, wait.  (I've
> put
> some charts comparing job performance during the Clinton and Bush
years
> on
> my Times blog, krugman.blogs.nytimes.com. It's pretty startling how
> comparatively weak the Bush era looks.)
> 
> Never mind. The whole point of scare tactics is that they can work
even
> in
> the face of inconvenient facts.
> 
> And what I'm not sure about is whether the Democrats are ready for the
> fight they're about to face.
> 
> Not to put too fine a point on it, Barack Obama won his impressive
> victory
> in Iowa with a sunny, upbeat message of change.
> 
> But there's a powerful political faction in this country that
> understands
> very well that any real change will create losers as well as winners.
> In
> particular, any serious progressive reform of health care, let alone a
> broader attempt to reduce middle-class insecurity and inequality, will
> have to mean higher taxes on the affluent. And members of that faction
> will do whatever it takes to scare people into believing that change
> means
> disaster for the economy.
> 
> I don't think they'll succeed. But it would be a big mistake to assume
> that they won't.
> 
> 
> Copyright 2008 The New York Times Company
> 
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