Krugman: People Are Ignorant Of The Decline... Yes, Decline... Of The Deficit

Krugman:

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Paul Krugman

You probably won’t be surprised to hear that voters are poorly informed about the deficit. But you may be surprised by just how misinformed.

In a well-known paper with a discouraging title, “It Feels Like We’re Thinking,” the political scientists Christopher Achen and Larry Bartels reported on a 1996 survey that asked voters whether the budget deficit had increased or decreased under President Clinton. In fact, the deficit was down sharply, but a plurality of voters — and a majority of Republicans — believed that it had gone up.

I wondered on my blog what a similar survey would show today, with the deficit falling even faster than it did in the 1990s. Ask and ye shall receive: Hal Varian, the chief economist of Google, offered to run a Google Consumer Survey — a service the company normally sells to market researchers — on the question. So we asked whether the deficit has gone up or down since January 2010. And the results were even worse than in 1996: A majority of those who replied said the deficit has gone up, with more than 40 percent saying that it has gone up a lot. Only 12 percent answered correctly that it has gone down a lot.

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Bolds mine. Be sure to tell your Republican coworkers so they can mock you for their ignorance. Your ignorance... I mean "mock you for your ignorance." ☺

GOP, Boehner Play 'Let's Fake A Counter-Offer'

Krugman is less than kind in his assessment of the GOP's "counter-offer" to Obama's proposal, and for good reason:

It goes without saying that the Republican “counteroffer” is basically fake. It calls for $800 billion in revenue from closing loopholes, but doesn’t specify a single loophole to be closed; it calls for huge spending cuts, but aside from raising the Medicare age and cutting the Social Security inflation adjustment — moves worth only around $300 billion — it doesn’t specify how these cuts are to be achieved. So it’s basically the Paul Ryan method: scribble down some numbers and pretend that you’re a budget wonk with a Serious plan.

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Did you expect anything different from the GOP? But wait; there's more: look at his Figure 1, "Economic Downturn and Legacy of Bush Policies Drive Record Deficit" ... have you ever seen an uglier curve? Without two Bush wars, the Bush tax cuts (overwhelmingly and irresponsibly large and directed toward the well-off), and... last and pretty much least... the economic downturn, our deficit would have been tiny and recovery largely assured, if a bit slow. It's undeniably the Bush deficit, and if you ask me, the bastard did it intentionally, with political malice aforethought. But that's a Republican for you: anything for political advantage; nothing for the good of the nation.

Krugman again:

And the GOP says that because of that deficit we must raise the Medicare age and cut Social Security!

I don't know about that. How much would the GOP House "leadership" enjoy the sight of millions of angry seniors, supporters of BOTH major political parties, heading up their driveways and over their lawns to their front doors, metaphorical pitchforks and torches in hand, to prevent exactly those cuts? Right. I didn't think so!

Sen. Bernie Says It Like It Is

... on michaelmoore.com:

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Most important, in the coming weeks and months, the Democrats must demand that deficit reduction is done in a way that is fair — and not on the backs of the elderly, the children, the sick and the poor. At a time when real unemployment remains close to 15 percent, we must also focus on creating the millions of jobs that our people need.

In America today, we have the most unequal distribution of wealth and income of any major country on Earth. Incredibly, the top 1 percent owns 42 percent of the nation’s wealth while the bottom 60 percent owns just 2.3 percent. In the last study done on income distribution, we learned that 93 percent of all new income generated between 2009 and 2010 went to the top 1 percent while the bottom 99 percent split the remaining 7 percent. This extraordinary unfairness is not only morally reprehensible, it is bad economics. It will be very difficult to create the jobs that our people need when so many Americans have little or no money to spend.

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Please read the whole post.

Erskine 'Catfood' Bowles For Treasury Secretary? Seriously?

Paul Krugman, in "Deficit Hawks and Hypocrites":

A large white cat menaces Erskine Bowles,
possibly seeking catfood

I don’t know how seriously to take the buzz about appointing Erskine Bowles to replace Timothy Geithner. But in case there’s any reality to it, let’s recall his record. Mr. Bowles, like others in the deficit-scold community, has indulged in scare tactics, warning of an imminent fiscal crisis that keeps not coming. Meanwhile, the report he co-wrote was supposed to be focused on deficit reduction — yet, true to form, it called for lower rather than higher tax rates, and as a “guiding principle” no less. Appointing him, or anyone like him, would be both a bad idea and a slap in the face to the people who returned President Obama to office.

Erskine Bowles (wiki) is a board member at GM and Morgan Stanley. In August he spoke in praise of Paul Ryan and in particular of the latter's "serious budget." I cannot think of a more archetypal representative of The 1%... or a worse choice for Treasury secretary. Appointing him to that post would be a sharp stick in the eye of everyone less conservative... more economically sane... than Newt Gingrich.

Krugman quotes the late great John Maynard Keynes: “The boom, not the slump, is the right time for austerity.” The deficit scolds with their one-track minds would be only too happy to give us more austerity, packed full and running over... just what we don't need as we begin to claw our way out of the Great Recession. Obama must be strongly discouraged from appointing any of them to anything. Their way has been tried; their way has failed. It is time for them to leave.

Full disclosure: I have some money invested through Morgan Stanley, from back in the days 30+ years ago when they had the only broker in Houston specializing in "socially responsible investing." I kept my conscience clear about what I was invested in, but I didn't make much money. A shoebox would have served me better. Oh well.

Corrected: I inadvertently substituted a link from a different Krugman post.

Corrected: I substituted "Newt Gingrich" for "Genghis Khan" as an archetypal radical conservative. May be better; may not be...

Afterthought: speaking of an "austerity bomb," look at Europe's unemployment. Jeebus!

Update 11/16: Bowles has said he will not serve as Treasury Secretary.