Paul Krugman Rightfully Calls The Fed Out for Bowing to Political Pressure (June 24, 2013)


New York Times columnist and Nobel Prize-winning economist Paul Krugman published an early week column entitled, “Et Tu, Bernanke?” The Latin allusion references the literary accusation of traitorousness, uttered by fallen Roman dictator Julius Caesar to his friend and fellow statesman Marcus Brutus at the moment of his assassination. A piece of dialogue from the pen of legendary dramatist William Shakespeare, the quote lives on because of its pain and simplicity. There are few wounds that rival the discovery of betrayal from people and institutions that we have taken for granted as acting in our best interests.

Krugman, a longtime opponent of the failed austerity plans implemented across Europe and the United States, has been a powerful, if lonely voice speaking against fiscal pain that only increases the torment of those who most need a lifeline. As Krugman has written many times in a variety of ways, the Great Recession, in large degree, is not the result of profligate financial behavior from ordinary citizens. It is instead a unique challenge presented by the runaway malfeasance of “too big to fail” banks, mortgage brokers and lenders and a host of other big businesses that have bounced back in while those they fleeced bore a double penalty: the taxpayer burden of resuscitating these institutions even as jobs, homes and retirement accounts went the way of the Edsel.

Krugman makes clear that these setbacks at the individual household level are still a long way from resolved. In fact, “The first thing you need to understand is how far we remain from full employment four years after the official end of the 2007-9 recession. It’s true that measured unemployment is down — but that mainly reflects a decline in the number of people actively seeking jobs, rather than an increase in job availability.” Simply put, almost five full years after the late-2008 market crash that sent the U.S. economy into a tailspin, many former members of the vibrant middle and working classes that made this country the envy of the world, have thrown in the towel.

The average American’s stoic ability to endure great suffering without the benefit of lobbyist dollars and infrastructure is not a reason to letup on policy making that could and should restore middle class dignity and security. Unfortunately, the very same folks who are all for corporate welfare stand firmly against “freedom killing” efforts to relieve the common man’s burden. Any talk of a jobs bill, an extension of unemployment benefits or Medicaid coverage is greeted with right wing howls against the “nanny state,” the threat of longterm deficits, etc.

But as Krugman points out, the Federal Reserve, should be immune to the disingenuous pressure of this chatter. A supposedly independent body with a three-prong mission (maximum employment, stable prices, and moderate long-term interest rates), the Fed suddenly seems as willing as the bulk of the GOP to abandon the first charge of its raison d’etre. And the columnist further suggests that the Fed never went far enough to aid the unemployed American in the first place: “You can argue — and I would — that the Fed’s activism, while welcome, isn’t enough, and that it should be doing even more. But at least it didn’t lose sight of what’s really important. Until now.”

Krugman is referring to Fed Chairman Ben Bernanke’s highly anticipated speech late last week in which, disappointingly, the leader indicated an imminent reduction in “stimulus” measures in favor of a return to normal monetary policy. The problem with this plan, as I have already highlighted, is that the nation remains dreadfully far away from that vaunted “maximum employment” goal. And the suggested reason for the Fed’s exhausted disinterest is more than slightly troubling.

“In any case, my guess is that what’s really happening is a bit different: Fed officials are, consciously or not, responding to political pressure. After all, ever since the Fed began its policy of aggressive monetary stimulus, it has faced angry accusations from the right that it is ‘debasing’ the dollar and setting the stage for high inflation — accusations that haven’t been retracted even though the dollar has remained strong and inflation has remained low. It’s hard to avoid the suspicion that Fed officials, worn down by the constant attacks, have been looking for a reason to slacken their efforts, and have seized on slightly better economic news as an excuse.”

We all know from experience that the squeakiest wheel tends to get the grease but that trope implies that the wheels all need attention in the first place. Why would a group that has been proven so wrong for so long – the conservative economists and think tanks – continue to have such an influence on supposedly nonpartisan policy making? It is more than frustrating and disheartening. It’s dangerous. It’s disloyal, even.

The Republican Party Resolves to Destroy Middle Class Once and For All in 2013 (December 27, 2012)


Paul Krugman, the famed economist and Op-Ed columnist forThe New York Times, has, in recent years, coined quite a few clever nicknames for hypocritical fiscal conservatives. And in referring to fiscal conservatives, he does not write of the dying breed of Republicans like Bob Dole, the former Senator, Presidential candidate and disabled war veteran who was humiliated in public by his own party earlier this month.

Dole made a rare appearance in the Senate chamber several weeks ago in an attempt to promote passage of a seemingly benign U.N. Treaty, the Convention on the Rights of Persons with Disabilities. Designed to improve access and mobility for the disabled across the globe, the treaty met with defeat from the crazed likes of political also-ran Rick Santorum, who decried the treaty on the catch-all Tea Party grounds that it posed a “direct assault on us and our family!”

It’s enough to make you wonder if Dole asked Santa for a time machine this Christmas so he could venture back to 1996 and fall off the stage at that rally directly onto Santorum’s delusional, useless noggin. It’s frightening to consider that in 2013, nearly 20 years after his failed bid for the Oval Office, Dole would be considered an unelectable liberal radical within his party’s ranks.

But I digress. When Paul Krugman writes of “deficit scolds,” “bond vigilantes,” and my personal favorite, “prophets of fiscal doom,” he refers to true charlatans like Congressman Paul Ryan, who wrote former President George W. Bush a budget-busting blank check for eight years, rubber stamping every unaffordable idea of which Dubya could dream, before suddenly putting on his serious monetary face the minute a Democratic President took the oath of office.

For months, nay years, we have been hearing from Ryan and his ilk that failure to address our long term budget deficits presents dire consequences, an imminent collapse of American security and respectability at a minimum if not an outright nullification of our entire way of life. As we moved ever closer to the edge of the fiscal cliff, the caterwauling grew louder…until it became clear that there’s just no way that President Obama is going to go against public opinion and leave the Bush-era tax cuts intact wholesale.

And just like that, the old fiscal cliff doesn’t seem so scary to GOP leadership. After all, when you come down to it, it’s not Ryan, Santorum or the one percent who will end up hurting if Congress blows past its 2012 deadline, right?

Those who booted up their computers this week to catch up on post-holiday news were greeted with headlines like this: “Senators Returning With Little Urgency as Fiscal Clock Ticks.” Writers Jonathan Weisman and Jennifer Steinhauer report “With just five days left to make a deal, President Obama and members of the Senate were set to return to Washington on Thursday with no clear path out of their fiscal morass even as the Treasury Department warned that the government will soon be unable to pay its bills unless Congress acts.”

Why the sudden move away from Republican baying about the dangers of falling over the fiscal cliff? Another writer for The Times, Nelson D. Schwartz, offers a possible answer: “Some hits — like a two percentage point increase in payroll taxes and the end of unemployment benefits for more than two million jobless Americans — would be felt right away. But other effects, like tens of billions in automatic spending cuts, to include both military and other programs, would be spread out between now and the end of the 2013 fiscal year in September.”

Why worry about what happens at the end of the year, in other words, when it is merely the unemployed and the working middle class who will take an immediate hit to their financial solvency? And lest anyone think the GOP is really troubled by the “automatic spending cuts,” it is best to keep in mind that the word “military” is the only one that gets their attention.

By now I really ought to be used to this sort of disingenuous skullduggery, the seamlessness with which members of the GOP establishment will hold the ENTIRE NATION and its future hostage in order to save some millionaires/billionaires a few bucks, but I must confess, I am not. I urge the mass media to give these tricks their proper title – treason.

Mitt Romney Tells America His Finances are None of Our Damned Business (July 10, 2012)

On Monday, New York Times Op-Ed columnist and economic guru Paul Krugman observed that “the contrast between George Romney and his son Mitt — a contrast both in their business careers and in their willingness to come clean about their financial affairs — dramatically illustrates how America has changed.”

George Romney unsuccessfully ran for President in 1968. At that time, the candidate got in front of questions related to his finances by releasing 12 full years of tax returns, a demonstration of transparency that ought to make those of us in 2012 nostalgic for a simpler time when the people who sought our vote actually treated us like adults. Instead this year, we have another Romney – Mittens – with a far more convoluted financial back story involving blind trusts, mysterious portfolios and offshore accounts, seeking to spoon feed the voting public a bunch of bull. Apparently if he tells America that “there’s nothing hidden there,” we should all act like the hypersensitized lemmings he believes us to be and take his word for it.

Romney has adopted the typical tactic employed by candidates who wish to dodge questions, calling repeated requests for information a mere attempt to distract voters.

Mittens, come on now: how could your refusal to come clean possibly be none of the voting public’s business? You are asking us to entrust you with our very nation and all its resources: military, financial, social and otherwise. Do we need to explain to you that in order to make the best judgment of your potential for stewardship, we need to understand your personal history in depth? If this is something your father understood, why can’t you?

And while we’re on the topic: can we talk about that blind trust? According to a report this morning from Yahoo! News, the “Republican nominee insisted he has little to do with his personal investments because they are managed by a blind trust.

‘I don’t manage them,’ Romney said. ‘I don’t even know where they are.’”

Can I see a show of hands from folks who find this credible? A man who has built a business empire and a Presidential campaign predicated upon his financial savvy, a quality that he claims is powerful enough to warrant the unseating of the highly-competent current Commander-in-Chief, would just love to have it both ways. He is both a wizard and a naive foundling, witlessly trusting those whose job it is to count his millions.

The Yahoo! Report goes on: “Responding to reports that some of his investments have been overseas, Romney insisted his ‘trustee follows all U.S. Laws.’ He added: ‘All the taxes are paid, as appropriate. All of them have been reported to the government. There’s nothing hidden there.’”

The double talk here is literally mind-bending. He is ignorant of his investments, can’t understand why we’re even interested, but rest assured, he hasn’t dodged any taxes. How do we know this? Because he says so. Stop it Mittens. Enough of this. Be a man and release ALL of your financial records and let us make decisions for ourselves, as we have been politically trained to do since we were old enough to vote. No one believes what you’re saying anyway – even the members of your own party. The best way to convince your constituents that you are not hiding anything is to stop hiding. It’s an idea that your father comprehended.

But what else should we expect from a man who has changed his tune on just about every issue before him? The Romney cynicism appears to know no limits.