Is Krugman Just Lying Now?
I read Krugman’s latest NYT op ed in amazement. It seems this notion that “it’s a myth Obama is trying to expand government” is catching on. Look at this excerpt:
Here’s the narrative you hear everywhere: President Obama has presided over a huge expansion of government, but unemployment has remained high. And this proves that government spending can’t create jobs.
Here’s what you need to know: The whole story is a myth. There never was a big expansion of government spending.
OK, so at this part you think we’re just quibbling over “big expansion,” right? In other words, you expect Krugman to go on to argue that yes, government spending went way up when Obama came into office, but it was too little, too late.
But no, that’s not what Krugman says. Look:
Ask yourself: What major new federal programs have started up since Mr. Obama took office? Health care reform, for the most part, hasn’t kicked in yet, so that can’t be it. So are there giant infrastructure projects under way? No. Are there huge new benefits for low-income workers or the poor? No. Where’s all that spending we keep hearing about? It never happened.
To be fair, spending on safety-net programs, mainly unemployment insurance and Medicaid, has risen — because, in case you haven’t noticed, there has been a surge in the number of Americans without jobs and badly in need of help. And there were also substantial outlays to rescue troubled financial institutions, although it appears that the government will get most of its money back. But when people denounce big government, they usually have in mind the creation of big bureaucracies and major new programs. And that just hasn’t taken place.
Consider, in particular, one fact that might surprise you: The total number of government workers in America has been falling, not rising, under Mr. Obama. A small increase in federal employment was swamped by sharp declines at the state and local level — most notably, by layoffs of schoolteachers. Total government payrolls have fallen by more than 350,000 since January 2009.
Now, direct employment isn’t a perfect measure of the government’s size, since the government also employs workers indirectly when it buys goods and services from the private sector. And government purchases of goods and services have gone up. But adjusted for inflation, they rose only 3 percent over the last two years — a pace slower than that of the previous two years, and slower than the economy’s normal rate of growth.
So as I said, the big government expansion everyone talks about never happened. This fact, however, raises two questions. First, we know that Congress enacted a stimulus bill in early 2009; why didn’t that translate into a big rise in government spending? Second, if the expansion never happened, why does everyone think it did?
Part of the answer to the first question is that the stimulus wasn’t actually all that big compared with the size of the economy. Furthermore, it wasn’t mainly focused on increasing government spending. Of the roughly $600 billion cost of the Recovery Act in 2009 and 2010, more than 40 percent came from tax cuts, while another large chunk consisted of aid to state and local governments. Only the remainder involved direct federal spending.
And federal aid to state and local governments wasn’t enough to make up for plunging tax receipts in the face of the economic slump. So states and cities, which can’t run large deficits, were forced into drastic spending cuts, more than offsetting the modest increase at the federal level.
…
But if they won’t say it, I will: if job-creating government spending has failed to bring down unemployment in the Obama era, it’s not because it doesn’t work; it’s because it wasn’t tried.
OK upon my second reading, I think I see his escape hatch. But c’mon, a casual reader would surely conclude from the above that total government spending had actually dropped because of the recession, right? That yes, federal spending went up a bit, but it was more than offset by the decline in state & local spending.
Except, that’s not what happened, at any point in this recessionsince Obama was elected, at least according to the seasonally-adjusted quarterly figures put out by the trusty bureaucrats:
“a casual reader would surely conclude ”
whatever they want to conclude because a casual reader is not an economist. Like a “casual architect” will not be employed to build my house.
“Except, that’s not what happened, at any point in this recessionsince Obama was elected, at least according to the seasonally-adjusted quarterly figures put out by the trusty bureaucrats:”
Then you site a graph that shows a STEADY increase for the past decade (ya know the population hasn’t changed or anything) with the ONLY plunge (on both lines btw) in 2009. Frankly I dont know where you learned to read graphs. ‘A casual reader would surely conclude’ the only decrease in GOV spending (both federal & Local) was under OBAMA…. So what’s your point again?
That big bump in 2009 is clearly the stimulus and tarp, at the same time when the similar decrease is happening on the “local” blue line. then federal spending goes right back to the standard trend. At the same time Local spending pops back up on of the whole to its trend line. (that would be the state rescue funds Krugman was talking about) And then you can see it flattening as we approach 2010 (State Aid ending).
In the last paragraph YOU YOURSELF point out the “escape hatch” (the whole bloody point of his argument). That ANY federal expansion in spending has been OFF SET by the reductions in LOCAL gov. spending (state, county, city etc.)
So….. who’s being disingenuous here? Or do you just not UNDERSTAND?..
Here to make it simpler.. you should ADD THE TWO LINES UP!!! that would be “total government spending” (yea know the total of the two numbers). After that, if you see a “HUGE EXPANSION” (other then the standard trend) you can call the nobel Lariat a liar.
PB
Seems more than a little contradictory from Krugman, who in mid-2009 was talking about how the economy had been saved by “big government”.
http://www.nytimes.com/2009/08/10/opinion/10krugman.html
“So it seems that we aren’t going to have a second Great Depression after all. What saved us? The answer, basically, is Big Government.”
“Ronald Reagan was wrong: sometimes the private sector is the problem, and government is the solution. ”
I guess since the economy didn’t recover as fast as he thought it would, government can’t have been big after all.
However, very slightly in his defence, I think the graph you’ve shown isn’t adjusted for inflation? So it isn’t quite as bad as this graph looks. In fact, it’s normal to adjust for GDP growth in such a calculation: by this measurement Bush and Obama combined increased the size of government by about 25-30%, rather than increasing by nearly 100% as this graph would suggest.
Great find Robert. Thanks for alerting us. I just posted an excerpt from the column you linked to Krugman’s blog (awaiting moderation but he almost always lets criticism through).
I’m sure the usual rebuttals will come from Krugman’s minions (that I am paid by the Koch brothers to spread Republican lies).
he’s not letting mine through 🙂
Daniel,
How can I get paid by the Kochs to spread Republican lies?
Bob, just stick to your primary mission for now. We all know that you are a corporate-backed candidate whose ultimate aim is to overturn every ruling by the state of Michigan against greedy corporations. If that fails, then you can work for Rupert Murdock or the Kochs as a propaganda artist. 🙂
….John Grisham’s book The Appeal is what I am referencing
http://en.wikipedia.org/wiki/The_Appeal
“From the beginning, I argued that the American Recovery and Reinvestment Act, a k a the Obama stimulus plan, was too small. Nonetheless, reasonable estimates suggest that around a million more Americans are working now than would have been employed without that plan — a number that will grow over time — and that the stimulus has played a significant role in pulling the economy out of its free fall.”
in that same article you site to claim “seems more than a little contradictory from Krugman,…”
(So again I ask), do you seriously not understand the concept of “proportionality” (we dont live in a bipolar universe, there are more options then “on and off”)
or DO you understand and are being purposefully disingenuous to convince those who do not?
PB
Patrick, hang on a second. Go look at what Robert has quoted Krugman as saying.
It cannot possibly be the case that
(a) Big Government saved us from recession and
(b) It is a myth that Obama has given us Big Government.
Krugman is clearly contradicting himself. Dozens of times I have caught him being slippery, but here is a flat-out contradiction.
And I wasn’t holding up your comment because it was too tough to handle; I have other things in my life.
“bobmurphy at
Patrick, hang on a second. Go look at what Robert has quoted Krugman as saying.
It cannot possibly be the case that
(a) Big Government saved us from recession and
(b) It is a myth that Obama has given us Big Government.”
Well it “CAN BE” if you’ve read and understood both of those articles that are quoted… (or maybe the same :: shakes head:: the same article)
He points out that the “LIMITED” stimulus (cuz he always… as in.. um… constantly ) was too small for the whole the private sector left ( there are facts and math involved with that)…
but it would be much worse if there was No stimulus… are you claiming it is PHYSICALLY impossible for un employment to go higher? like not possible for it to be 50%????
i mean lets just say no government bailed out the banks…
yea… 65% of the wealth in the nation (and those who control it) goes bankrupt all in the same week…
Yea a legal evaporation of 65% of US wealth happened in a week( or a month)….
No problem.. we’d all be chill….
Is that your point?..
Or is Krugman’s pointing out that the bail out and stimulus (adding that in there) were limited responses made by (the only possible actor) “big government” saved us from a much worse calamity…
I mean just in the logic (if you don’t agree with any of the conclusions) The logic is SOUND… no?
I was about to copy and paste the “pay VS drive” thing again.. but I assume you are actually reading this (seriously thanks… good to know someone does actually read/think about this stuff). so i wont bore you..
I stand by: its not a contradiction to say “government saved us from Hell and the fact that it wont do more is why the problem isnt being “fixed” back to good times”
but seriously No insult about the not “OKing” me I had nothing to do with my life today and this was my first time on your site… so i checked back regularly…
any random open forum I highly respect. (not that it matters)
Patrick, I am glad you visited the site and I don’t want to scare you off.
Believe me, I understand what Krugman’s position vis-a-vis the stimulus was and is.
But look, you yourself changed Krugman’s argument when you responded to me. You wrote:
I stand by: its not a contradiction to say “government saved us from Hell and the fact that it wont do more is why the problem isnt being “fixed” back to good times”
But that’s not what Krugman said, and it’s not the simple two statements I listed for you.
Krugman said that BIG government saved us from Hell, and that it is a myth that we had big government under Obama.
So yes, that is a contradiction, plain and simple.
you’re kidding, right?..
“big government” is not a specifically measurable metric.
Its a subjective derogatory phrase.
What i think is “Big government” in a negative sense vs what you think is “big government” is gonna be different.
i don’t mean to be rude, but I’m not exactly an English language expert
He is using the phrase ironically! you claim i “changed his point” when i was explaining his position. (that you clearly do not understand)
just because you dont understand irony, doesn’t mean im changing his position.
How would you explain a position to someone who didn’t understand it the first time? Just QUOTE it again?
he’s saying “BIg Government” (programs people like you are against) saved us! MORE “BIG Government” programs COULD save us more.
get it?
again, there is no big switch outside the Whitehouse that Obama flipped with a NEON sign saying “BIG GOVERNMENT ON”
do you thin there is?
oh yea.. Economics i forgot about that part..
The economics behind this whole semantic argument is that in a Recession GOV should expand to fill the whole of the loss in private sector spending.
TARP (almost paid for itself) and Stimulus were mainly filling the whole of local govt keeping “total government spending” steady when it would have naturally declined like the private sector.
Basically we steadied the ship and kept it from spiraling out of control (i.e. a second GREAT DEPRESSION) however much like in the 30s political pressures are not allowing us to spend appropriate amounts of money to kick start the economy into growing again. (especially in the lower income areas)
whether or not you get Krugman’s writing style or if he just blatantly LIED to change HIS definition of “Big Government.”
mwahahaha :: taps fingers together ::
Krugman was right about the stimulus, about TARP and most importantly the BIG predictor of the economy INTEREST RATES. He said we were in a liquidity trap territory 2 years ago..
How much you wanna bet if i go back two years on what you’ve written you were predicting sky rocketing interest rates do to the monetary expansion? (if im wrong i’m sorry)
Beautiful Robert. If you want me to credit your full name, let me know; this has just been elevated to a Mises Daily.
Well, I wouldn’t worry about that; I don’t think it’s hard to find Krugman contradicting himself these days (For one thing, Scott Sumner catches him doing it about once a week). Glad the link was of use though.
However, perhaps I should start posting comments with my full name anyway, for the sake of having some sort of well-formed online identity.
“I guess since the economy didn’t recover as fast as he thought it would, government can’t have been big after all.”
AGAIN in his own OP ed column he states (as he stated in early 2009) they Stimulus was too small and not well targeted. TARP and the Stimulus headed off a “second great depression” his whole point (constantly from the beginning) is that the stimulus was too small but it would have been MUCH worse without it. That is not a CONTRADICTORY statement!
We have to get to a destination 60 miles from here in an hour. I claim we should drive 60mph YOU claim we should pray to get there on time. I finally convince you to get into the “devil machine” if i only drive 30mph. Now at the end of the Hour we are only 1/2 way to our destination. you turn and say “see we should have prayed”
But i have to admit Robert here is better at reading graphs then you. I love how Robert thinks ‘well the gov increase really isn’t as large as you think it is’ (that being Krugman’s WHOLE POINT of the “expansion myth”) His logic has gotten the better of him for a sec there.
You certainly shouldn’t conclude government hasn’t expanded at all. An increase in the Federal government from under 20% of GDP under Clinton (crazy right winger that he was) to about 25% of GDP now. That’s a significant change, especially considering GDP has gotten bigger.
Where did you get the 25% figure from? It’s still 20%. Ronald Reagon had bigger government that Obama as a percentage of GDP.
http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=14&ViewSeries=NO&Java=no&Request3Place=N&3Place=N&FromView=YES&Freq=Qtr&FirstYear=1980&LastYear=2010&3Place=N&Update=Update&JavaBox=no#Mid
I was going on the statistics from Wikipedia.
http://en.wikipedia.org/wiki/United_States_federal_budget
3.5t/14.25t = ~25%
That’s Federal only.
I think the table you’ve quoted must be measuring something different (although I can’t think what) or is just wrong. It says all Federal spending excluding defence is 2.7% of GDP. That’s $385b total for Medicare, SS, interest on the national debt, etc.
Does someone know what “consumption expenditures and gross investment” means and whether its different to the overall budget somehow?
Easton, you’re only talking about the FEDERAL expenditures. While the WHOLE POINT OF THE ARTICLE Is that if you add the “expansion of federal” to the contraction of local (state, county city etc) you get TOTAL government spending.
Jones is pointing to the GDP numbers
C is consumption (consumption expenditures )
I is investment (gross investment)
G is TOTAL government spending
NX is exports
this is ECON 101, Its how you calculate GDP
Y = C + I + G + NX
the G is not JUST federal, its ALL gov spending
so ONCE AGAIN, if you add it all up you get a pretty steady number. (which is the whole bloody point)
Now if we had done what “some people” here wanted to do, (No tarp no stimulus etc.) then the TOTAL gov spending (G) would be much smaller.. (so not steady but actually falling along with C and I ) and can you do the math there?..
What would Y (GDP) look like?
and why are you excluding defense?
Economics does not adjust for political blood lust.
Money being spent is MONEY being spent.
seriously?… how can someone be so nerdy as to post on a blog like this, but still not understand sooo much?
I think it might have something to do with the fiscal year for the US government budget starting in October 1st. The BEA website starts in January. Don’t know really.
Patrick Bateman:
(1) Yes I thought interest rates (and CPI) would be higher now, than they are. I still think they will rise a LOT but thus far Krugman looks better than me on that score.
(2) In your most recent post you use the GDP accounting equation to argue that a drop in G leads to a drop in Y. Are there any other constraints in your mind? For example, if we bumped up G by $5 trillion, does GDP automatically go up by the same amount? Note that you are relying on the Keynesian theory, not the GDP equation. For example, a Chicago School guy could say, “Yeah Patrick, if G had gone down, then C and I would have gone up, just like the equation says.”
(3) Go back and look at the part I put in bold in Krugman’s column. He was either outright saying, or heavily implying (you pick), that total G *fell*. He implied that yes, Obama did increase federal spending, but that this was more than offset by the fall in local and state spending. So that’s why I was saying he was a liar, because total G never fell from the time Obama took office. It zoomed up in early 2009, then leveled off, then zoomed up again.
Bobmurphy
(1)
but ist that the whole point?… that you say our recession is of X model and we should have “y” policy decision…
in your model Interest rates should have gone up!
they didnt… so shouldnt we be looking at different models right now?… like models that match high unemployment steady low interest rates across the board labor surpluses… etc (i could go on)
and then go by that model to make policy recommendations?..
(2)
i was not trying to “prove” my point with that… He didnt understand what “consumption” was.. so i was explaining to him the GDP formula and the different area’s
i did not put up the keysian formula explaining the larger plunge in C VS (and which can lead too ) lower G and how that effects I if borrowing a lot of money (of G and C) etc… or how any of that effects Exports… (i mean it gets complicated… did you really want to go into all of that?… or can you just look it up in any econ 200 text book?
(3)
you see, i never read it that…. I think our definitions (or how we think of) “offset” is different. (one might say bias). I think of “offset” as in Counter balances.. And as i’ve stated MULTIPLE times that that sentence MEANS that total G relatively stayed steady NO MAJOR SHIFT…
you seem to take “offset” as if it means it goes the other way.. that total G ended up contracting just as much as G “should have” expand and the fact that he just never claimed that. You “think” he did…
thats all i have to say to that… frankly i’d like to post this on a “arts blog” or IMDB… to see how people interpret that sentence… cuz now i kinda get what you’re saying.. I just think you’re wrong.
“Bateman”, I think you missed the point of my comment entirely. Desolation Jones claimed that Federal, state and local government spending combined is 20% of GDP. I linked to some data that shows this is completely untrue. I didn’t say anything about whether it has increased or not.
I excluded defense spending because the statistic D.J. gave for defense looked plausible. The thing that was not even close to plausible is that everything else the Federal government does costs only 2.7% of GDP. It’s more like 5x that number.
And yes, I know the GDP formula. I don’t see how it’s remotely relevant. We were talking about simple statistical facts regarding what percentage of GDP is consumed by government.
I asked what “consumption expenditures and gross investment” means because the statistics D.J. linked to use that phrase. I wanted to know if the phrase refers to some specific bit of government spending, because if not, the statistics are just flat out wrong.
Robert, the “consumption and investment expenditures” exclude transfer payments. So that’s why they are so small, compared to the size of “federal spending.” I.e. those are only capturing the consumption and investment expenditures directly accruing to the government, whereas a Social Security payment is what funds consumption/investment expenditures by the retiree.
Robert Easton-
No, no no no… you didn’t “link to data” JONES “linked to data” YOU linked to a fairly long WIKi article and claimed “3.5/14.25 ~ 25%”
btw on a “find” “14.35” isn’t on the page and “3.5” is something about a projected local shortfall in the future?.. so did you just make all that up?.. or put the wrong link down?
you’d think you’d wanna check your work when we’re on the 3rd back and forth about facts!!!!
but moving on.. you continued (in your original post with the “evidence”)
“that’s federal Only”
admitting “I think the table you’ve quoted must be measuring something different”
yea.. that different thing he was quoting is WHAT WE ARE DISCUSSING TOTAL government spending as a percent of GDP!
AND He got that “table” from Department of commerce quarterly GDP numbers from 1980 to present.
there is no argument here TOTAL G has stayed relatively steady (around 20%) for the past 3 years.
can we all move on now?…
Dear Bob,
The Wikipedia article has the numbers for the planned budget year to year, but does that included emergency spending measures?
Is the number how much our national government planned to spend, or how much they actually spent?
chef Steve
Patrick, please look at just this paragraph:
“And federal aid to state and local governments wasn’t enough to make up for plunging tax receipts in the face of the economic slump. So states and cities, which can’t run large deficits, were forced into drastic spending cuts, more than offsetting the modest increase at the federal level.”
What in the world does “more than offsetting” mean, if not to say that the total of the two went down?
Especially when this occurs after Krugman explaining how the total number of government workers went down?
By all means, post just this excerpt somewhere else, don’t say the context or who wrote it, and just ask, “Do people think this person is claiming local, state, and federal spending actually went down, or do we need more information?”
Incidentally Patrick, let me give you the escape hatch: What Krugman means here is that the federal AID TO THE LOWER GOVERNMENTS was “more than offset” by the cutbacks in their spending. So that number did in fact go down.
But I bet most readers–let’s say 85% of them–would have concluded from the whole column that Krugman was saying that combined local, state, and federal spending actually dropped.
oh i didn’t see this…
I didn’t need the “escape hatch”
As i pointed out… ‘combined local, state, and federal spending DID actually drop’ between the two articles you’re quoting..
I don’t think such a small move is really all that economically relevant HOWEVER technically true..
if the numbers (by chance) had gone the other way would you show such intellectual honesty and restraint?
“don’t say the context or… ”
yes, taken out of context you might have a point… congrats… lol
but anyways
your “evidence” that he “is just lying now” (about a claim he has never made before, and the numbers HE USES doesn’t show) is that he included the words “more than” instead of just saying “OFFSET”?.. ARE YOU KIDDING?.. that’s it? :: slams head on desk::
First of all, I think (for the 5th time now) “more than offset” can be interpreted as “relatively stays steady” why because thats what he alway’s has said, it’s what the numbers he uses to back up all his other claims shows, … :: rubs eyes:: fine whatever ask an english major (again I’m bias because i understand what he’s talking about)
If you still are trying to “get him” with his EVIL “MORE THAN” lie, that clearly discredits his economic arguments…(sarcasm) I’d like to point out that this (recent) article is about recent spending, when the AID to local government stopped. ( BIG GOVERNMENT switch turned off… lol)
If you look at the recent numbers what do you find?.. go ahead look… I’m not gonna actually write it here cuz i want you to think: “no it really hasn’t gone down has it?… really?”
http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=14&ViewSeries=NO&Java=no&Request3Place=N&3Place=N&FromView=YES&Freq=Qtr&FirstYear=1980&LastYear=2010&3Place=N&Update=Update&JavaBox=no#Mid
I dont think that was his point (cuz he didn’t say it was) A couple tenths of a percent drop isnt really statistically relevant. But if he’s a lying intentionally misinforming person for claiming total gov spending has gone down… Then what does that make you?.. when it turns out it has? (however small) ?
BTW from 20.8 to 20.6 to 20.5 3rd quarter of 2009 to 2nd quarter 2010. (ok i couldn’t help myself) I wonder what happened in these past 9 months, could tarp be slowing down?.. could there be less aid to state and local governments?.. could those other “words” in the article (excluding “less than” of course) help explain that to a “casual reader?”
seriously .. if your whole point is that Krugman is “lying about total gov. spending going down” AND IT HAS.. what the hell is this about?
MY POINT (and im pretty sure krugman’s point too) is that a couple tenths of a percent up or down doesn’t really matter.. the economy is BIG and we need equally big metrics to effect anything.
so lets recap: “BIG government” is a subjective derogatory statement to describe gov. spending someone politically doesn’t agree with. When krugman used it it was simply making fun of people like you while discussing GOV. programs that should have been bigger but still WORKED the way we all predicted it would (give or take a percent or 2). He did not DECLARE “BIG GOVERNMENT ON”… right? do we all agree with that now?
To your damn persnickety (“gotta get Krugman”) second point Total Government spending HAS actually gone down sense that first “BIG Government” article..
:: shakes head:: so who’s “just lying now?”
OH btw, you can slip up in an article it happens all the time. A “lie” would be when you constantly repeat something OVER AND OVER again when you know its wrong. Like you and your continuing prediction that interest rates will rise. (oh that was a cheap jab, but it was funny) … To be fair, I guess technically, you are right, Interest rates will not stay around 0 for the rest of eternity… Genius economic prediction there.. HOW DOES HE DO IT!!!!
good sport…
OK I think we can stop now, Patrick. Earlier you said you were interpreting “offset” to mean merely working in opposite directions, not necessarily completely overwhelming the other influence.
And then when I point out that he said “more than offset,” you are saying, “Are you kidding me?” as if my point is absurd.
It doesn’t mean Keynesian economics is wrong, but it does mean I am done arguing with you. You keep changing your line of defense.
OK your “done” how convenient.
Having MULTIPLE ‘lines of defense’ is not “changing” my line of defense, its a product of you having so much BS to work with..
The fact that your entire point boils down to “he claimed total G went down” (when that wasn’t really his point) and it DID go down. just shows YOUR bias. Not MINE .. or Krugmans..
You claim Krugman’s a liar because he Used the “phrase big government” and then a year and a half later he claims that “the huge expansion you “think” happened didn’t”
His argument (the point of the article) was not that G went down! it’s that IT DIDN’T EXPLODE like you all CLAIM IT HAS. (who’s the liar again?)
Just like the POINT of this post isn’t that I’m using a MAC, its true, I AM but its not relevant. Now if you claimed I’m lying about my computer then wouldn’t that make YOU the liar?… is this the “i know you are but what am I?” defense?
I’ve explained Krugmans point here ‘more than enough’ for a “casual reader” to understand.
ooops wait.. if i’ve explained “more than enough” would that mean that the “casual reader doesn’t understand anymore? I’ve explained SOOOO much that their head exploded?. LOL (see how “more than enough” can be interpreted there?)
I know “you’re done” but I’m not and i cant get over you do this for a living.
Did you want to respond to the fact that i tried to have a reasonable discussion of Krugmans economic arguments and you throw a tantrum sayin’: HE”S LYING >.. he’s a liar.. any explanation of what he was saying no matter how much it matches the rest of the article is not an explanation, but is CHANGING his position, which i just KNOW he was thinking. (circular logic much?)
He’s lying cuz he used the phrase “big government” (have you given up on that one yet?)
then it was: he’s lying because he “claimed” “Total G went down” as i pointed out not really what he was “claiming” BUT HE’S A LIAR for saying it.
BUT (as you ignored) IT DID GO DOWN (how ever small) … did it not?
so again.. i ask.. who’s the liar here?
I guess i’d be “done” too if i were you… 🙂
and ya… you taking “more than offset” as concrete evidence he’s making a claim he’s never made anywhere else… yea.. is kind of absurd…
One MIGHT say “more than enough” to legitimately call you absurd…
PB
I’m confused how he just throws Health Care under the bus, even though it definitely will happen. Or how doubling the length of Unemployment insurance doesn’t count either. Completely ignores the foreign policy issues like Afghanistan War and assassination.
“And there were also substantial outlays to rescue troubled financial institutions, although it appears that the government will get most of its money back.”
Am I supposed to feel happy that it is more likely than not in the eyes of Paul Krugman that we will get more than 50% of that money back. All he said there was the expected return was above 25%.
What about financial regulation and credit regulation? Or all the money Obama was planning on spending in the first place, but was shot down? Or everything he claimed he was going to do?
He may not be lying but he has gone to some serious stretches to claim that Obama isn’t increasing government spending, and for what? Where does that get him, even Paul Krugman would agree that expected increase in government spending is very important.
Well you take a very specific economic issue and not only ignore the main points of Gov spending VS Not. But you turned it into a referendum on literally everything OBAMA does..
EVERYTHING (did you miss ANY stated policy?)
I just dont know how to respond to that… DUDE… I got my Issues with OBAMA. (mainly about his conservative economic policy) …
I’m talking economic Policy here… come on back if you want…
Without knowing it, Krugman hits a point he and his peers don’t understand or want to admit they are wrong on.
They measure the economy from a GDP point of view. They measure finished product. They don’t measure the economy that produces the finished product. They never come close.
In my own country, not known for its low taxation nor known for small government, allegedly public sector spending is near 50% of GDP.
But if you measure it from a point of view that Bastiat and perhaps Austrians should do, the public sector is less than 1% of the total economy.
This is where Austrians MUST take a standpoint and start realising that this fallacy is what the Keynesians are living on. The problem with GDP is their bread and butter. If that goes away a completely different picture emerges of the real economy.
In that respect, Krugman is actually right. The stimulus never gets anywhere near being enough because the economy is so much bigger than the measuring stick he uses.
And this should tell him, not that the stimulus was too small, but rather that it can never become great enough to stop a process reconciling the mischief a number of corrupt bankers, a banking system and incompetent political leaders have created over decades.
The reconciliation is here and it is here to stay. It will blow up no matter what stimulus Krugman, Bennie and Obama comes up with.