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Thursday, February 7, 2013

Paul Krugman, "Kick That Can": No Longer "Yes We Can"

You want a poignant indication of the severity and danger of America's debt problem? You need look no further than measures being taken by the State of Virginia to issue its own currency (see:

You want another indication? Even Paul Krugman is now acknowledging that the US economy is in a shambles and that debt needs to be brought under control.

In his latest New York Times op-ed entitled "Kick That Can" (, Krugman grudgingly admits that "we will eventually need some combination of revenue increases and spending cuts to rein in the growth of U.S. government debt." Krugman, however, claims that this is not the time for the federal government to swallow its medicine:

"Given the state we’re in, it would be irresponsible and destructive not to kick that can down the road.

Start with a basic point: Slashing government spending destroys jobs and causes the economy to shrink.

. . . .

[F]iscal austerity should wait until the economy has recovered, and the Fed can once again cushion the impact."

But has spending by the Obama administration over the past four years created jobs? Are there signs of an economic recovery anywhere in sight? Is it possible that short-term, or even medium-term, the economy is not going to recover?

"Given the state we're in," some sort of economic plan is necessary, but meanwhile, Obama is surrounding himself with a cabinet of the worst and dumbest, a harbinger of further intellectual and economic stagnation.

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