Paul Krugman was a recent guest on Morning Joe. That appearance led Joe Scarborough to write an opinion piece titled Paul Krugman vs. the world.
Scarborough starts off on a bad note with an attempted bastardization of Krugman’s position on deficit spending:
Mr. Krugman’s view is that Americans would be better off if its government ran deeper deficits and ignored its longterm debt.
Actually Mr. Kruman’s view is that Americans would be better off if its government ran deeper deficits during an economic downturn. Krugman does not want to ignore longterm debt. He wants to address the long term debt when the economy has recovered.
Spend now, while the economy remains depressed; save later, once it has recovered. How hard is that to understand?
One can imagine Krugman asking that question in exasperation, and just throwing up his hands in frustration as his view is continuously distorted by “deficit hawks” like Joe Scarborough.
Where Scarborough is doubly wrong is in his overall approach to deficit spending. I’ll give Joe credit for sounding the deficit alarm while Bush was president, but he is a distinct outlier on the conservative side in that regard. Being consistent regardless of the president in power is admirable, but it does not make you right about deficit spending during a recession.
Normally the amount of conservative deficit concern is directly related to the party affiliation of the president. One prime example of this phenomena is one of the most vocal voices of austerity in the Republican party, Paul Ryan. Ryan spent his time in congress during the Bush administration voting for massive spending programs which are largely responsible for the budget deficit of today. He voted for the unfunded 2003 prescription drug benefit. He repeatedly voted for financing wars without funding them. He never seemed to have objections to raising the debt ceiling under Bush. He voted to bail out Detroit, even as Mitt Romney was exhorting the nation to let Detroit go bankrupt. Ryan even voted for that ultimate conservative bugaboo, the Tarp program. Right up to the day of President Obama’s inauguration it seems Paul Ryan had little concern for deficit spending.
Why are there so many conservatives who are inconsistent when it comes to deficit spending depending on who is president? I think the austerity being insisted upon by those conservatives is nothing more than a thinly veiled disguise to keep the economy from recovery while a Democrat is president. Perhaps that sounds overly conspiratorial, or just not nice to say in polite company. Just keep in mind that Republicans met on the very night of the 1st Obama inauguration and planned to strangle his presidency in the crib with record levels of obstruction. Remember, that meeting was held at a time when the economy was losing more than 600,000 jobs a month. There was real concern that the worst was yet to come and we may be sliding into a depression.
Republicans never dealt in good faith with the Obama administration trying to help the economy recover. Being overly concerned about budgetary deficits during a recession only assisted them in throttling the Obama recovery.
There is no way to prove the following speculation, but I wonder what the state of the American economy would be today had both parties decided to approach the recession with some type of robust government jobs program. Imagine where we would be if there had been a sustained push to rebuild and repair the American infrastructure. I suspect the economy would be in much better shape.
Having a strong economy with more people employed and contributing rather than out of work and needing assistance is the best solution to paying off national debt. Austerity measures simply do not contribute to economic recovery, and that is a fact which has been proven over and over. I contend that if the approach to the deficit early in this recession had been to fix the economy now and fix the budget later, our economy would be much stronger and the deficit outlook would be brighter as well.
Most of Scarborough’s column is a litany of reaction from folks he knows to the Krugman appearance on Morning Joe. This pundit was shocked and that talking head was flabbergasted. This expert was puzzled and that former official developed the vapors. Pointing out that the conventional wisdom in Washington is to push for more austerity does not refute Krugman, it echoes him. His is the lone voice in the pundit wilderness crying out for his point of view, including such luminaries as President Obama * and, yes even Mika Brzezinski who would normally side with Krugman on political matters.
Having conventional wisdom on his side does not prove Scarborough’s point. If anything the title of his article, “Paul Krugman Vs. The World”, points to the proof of Krugman’s opinion. The title is not entirely accurate because Joe only demonstrates how Krugman goes against the grain of American conventional wisdom. But there have been austerity measures around the western world which have led to continuous recession and stagnant economies. Why American economists and politicians would look at these real world case studies and decide to maintain austerity as the answer to American economic trouble is beyond me. Unless of course those folks wanted to continue a stagnant economy while the other party held the White House.
* Folks wondering why Obama is worried about deficits when that seems to be counter to his economic interests should consider that his plans include much greater sacrifice by the upper crust of society than do most other budgetary hawks. If we are to be overly concerned by deficit spending he at least has the good sense to propose that we should spread the costs evenly, not just slash and hack away at the social safety net. But all in all Krugman and myself would also tend to wonder at the seeming conundrum of the president acting against his own interests, so welcome aboard.