Krugman: "What the centrists have wrought."

While I'm sure many will accuse me of overexaggerating the importance of this, much like DKos blogger Words in Action's diary tonight over at the Big Orange, "Krugman: What the Centrists Have Wrought," I truly feel that one of the most important comments ever posted on a blog appeared early this evening, written by Nobel Prize winning economist Paul Krugman: "What the Centrists Have Wrought."

Here it is:

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What Krugman Said

Paul Krugman hits back hard against Republican stimulus ridiculousness in his column this morning:

A not-so-funny thing happened on the way to economic recovery. Over the last two weeks, what should have been a deadly serious debate about how to save an economy in desperate straits turned, instead, into hackneyed political theater, with Republicans spouting all the old clichés about wasteful government spending and the wonders of tax cuts.

It's as if the dismal economic failure of the last eight years never happened -- yet Democrats have, incredibly, been on the defensive. Even if a major stimulus bill does pass the Senate, there's a real risk that important parts of the original plan, especially aid to state and local governments, will have been emasculated.

Somehow, Washington has lost any sense of what's at stake -- of the reality that we may well be falling into an economic abyss, and that if we do, it will be very hard to get out again.

Krugman was also on Morning Joe where remarkably Joe Scarborough suggested that perhaps a "mixed" strategy of both Democratic and Republican ideas should be brought to the table instead of going "all left and all right." As Steve Benen correctly notes:

Scarborough...seems oddly detached from current events, had no idea that President Obama proceeded with this exact assumption in mind. Scarborough may not have been paying attention to the news, but the White House not only engaged congressional Republicans directly, but deliberately added unstimulative tax cuts to the package to help bring GOP lawmakers on board. Obama's plan isn't "all left" in the slightest.

Krugman hit back at Scarborough's naivete and slammed Republican obstructionism:

KRUGMAN: Look at what just happened, we had a proposal I think it was McCain's proposal for an economic recover package, his version of it which was all tax cuts, a complete, let's do exactly what Bush did, have another round of Bush-style policies. After eight years which that didn't work and we got 36 out of 41 Republican senators voting for that which is completely crazy. So how much bipartisan outreach can you have when 36 out of 41 republican senators take their marching orders from Rush Limbaugh?

In the meantime, Barack Obama has gone back to campaign mode to fight for the stimulus and what do you know...no one ever could have predicted that he'd be accused of being {gasp!} "partisan!"

Politico:

A fired-up Barack Obama ditched his TelePrompter to rally House Democrats and rip Republican opponents of his recovery package Thursday night - at one point openly mocking the GOP for failing to follow through on promises of bipartisanship.

In what was the most pointedly partisan speech of his young presidency, Obama rejected Republican arguments that massive spending in the $819 billion stimulus bill that passed the House should be replaced by a new round of massive tax cuts.

Good. If being this "partisan" is finally seen as the solution and not the problem, then maybe we can get away from the fetishization of bipartisanship and start to solve America's problems for a change. Prioritizing "bipartisan cooperation" over doing what's right is learning the wrong lessons of Obama's victory in November. Voters rejected Republicans, they did not give Democrats a mandate to reach out a hand to them. Americans voted first and foremost for a government that works again. Yes, of course Republican votes will be needed, it would be great if all Republicans would come on board, but that in and of itself is NOT what Americans voted for in November. I thought Obama got that. If he didn't, I think he's starting to.

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Fiddling

Some wisdom from Paul Krugman on Rachel Maddow tonight on why the Republican tax cut argument vis a vis the stimulus package seems to be gaining ground:

I think this is partly bad media coverage, it's partly they have a simple point to hammer and I have to say, until today, Obama and team...were so busy trying to change the tone in Washington that they weren't focused on the main thing, which was to get this economy moving.

Some wisdom from Maureen Dowd in her latest column on Obama's mis-steps not only in selling the stimulus package but also in a few of his appointments.

The Democratic president has been spending so much time trying -- and failing -- to win over Republicans that he may not have noticed the disillusionment in his own ranks.

Betrayed by their bankers and leaders, Americans were desperate to trust someone when they made Barack Obama president. His debut has left them skeptical about his willingness to smack down those who would flout his high standards or waste our money.

My Independent brother -- an enthusiastic Obama supporter -- called me on Monday to tell me Obama was losing him as a result of Obama's picking people with, shall we say, an aversion to paying their taxes to serve in his cabinet. Doesn't he remember what he ran on? Disillusionment was exactly the word that came to mind speaking to him. When I told him Daschle was out he seemed re-energized and it's looking as though our president is as well.

Here he was earlier today saying what he should have been saying all along about the Republican opposition to the stimulus:

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Trusting the Private Sector- Paul Krugman Weighs In

This diary is tangentially related to President Obama's plans for the banking crisis, and, the more deeper question I have with him about his assumptions about the U.S. being a meritocracy. Briefly, I should say I favor the so-called Swedish plan of briefly nationalizing, getting rid of present management and cleaning up the assets, and then reselling the assets to the private sector. I am not against the private sector, but I do understand its limits.

I should point out that in the 1990s I was a raging centrist. I consider myself now to be a raging pragmatist. The centrist is concerned with the political center as defined by the right, and pragmatist is concerned only with policy outcomes. I am still ironically pretty much a moderate, but I am one who has lived in the real world of business rather than the world of academy, politics and media. I am now making a transition to media, and therefore, I tend to understand questions related to it, but my core background is working in the private sector. Thus, I ask:

Should we trust the private sector to solve our problems?

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Kill Stimulus Zombie Lies

Predictably, Republicans aren't opposing the stimulus package in good faith. Just as predictably, the traditional media isn't spending enough time fact-checking Republican accusations.

Today's Paul Krugman column serves as a handy cheat-sheet of the most prominent stimulus falsehoods. The whole thing is worth a read, but here's the condensed version:


First, there's the bogus talking point that the Obama plan will cost $275,000 per job created. Why is it bogus? Because it involves taking the cost of a plan that will extend over several years, creating millions of jobs each year, and dividing it by the jobs created in just one of those years.
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Next, write off anyone who asserts that it's always better to cut taxes than to increase government spending because taxpayers, not bureaucrats, are the best judges of how to spend their money.
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Finally, ignore anyone who tries to make something of the fact that the new administration's chief economic adviser has in the past favored monetary policy over fiscal policy as a response to recessions.

It's true that the normal response to recessions is interest-rate cuts from the Fed, not government spending. And that might be the best option right now, if it were available. But it isn't, because we're in a situation not seen since the 1930s: the interest rates the Fed controls are already effectively at zero.

Traditional media keeps regurgitating the falsehoods, and Media Matters is all over it.

But it's an uphill battle - and the more these lies filter into mainstream press coverage, the more Democrats feel pressured to accept them as truth, even if they know better. Then we get:

Dems Defend Tax Cuts While Calling Them Ineffective

Two of the highest-profile Democrats in Congress argued on Sunday that when it comes to the economic stimulus package, spending projects will do more to jump-start the economy than tax cuts.

And then... they defended the tax cuts.

Appearing on the Sunday talk show circuit, Sen. Chuck Schumer and Speaker Nancy Pelosi touted the merits of the recovery package now making its way through Congress. But there was a peculiar logic to their defense: tax cuts would not be as effective in encouraging job growth, but they would make up a major portion of the legislation anyways.

Even with control, Democrats want to diffuse the political risk of owning the stimulus - so they agree to add bad Republican measures that will, ironically, reduce the the efficacy of the stimulus and increase the risk that Democrats will be blamed.

As Atrios says

With bipartisanship you'll not only get a compromise that sucks, when it's time to throw the bums out no one will be quite sure which party should be blamed. Then what new candidates do is just run against some generic "Washington."

Democrats have the presidency and big majorities. Instead of hiding behind the spread-the-blame-around tactic, they should announce their vision and run with it.

There's no risk-proof strategy in a crisis. But attacking the stimulus falsehoods will go a long way towards giving Dems the breathing room to pass what's needed.

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Diaries

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