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Thursday, October 17, 2013

Paul Krugman, "The Damage Done": The Blame Game

Okay, we have a temporary solution to the shutdown, but as known to all, the US economy remains a mess. Who is to blame? If you're Paul Krugman, the answer is obvious. In his latest New York Times op-ed entitled "The Damage Done" (http://www.nytimes.com/2013/10/18/opinion/krugman-the-damage-done.html?adxnnl=1&adxnnlx=1382071460-tlsSzj+aDAKRfwNnaSUeMw), Krugman concludes:

"Are all the economy’s problems the G.O.P.’s fault? Of course not. President Obama didn’t take a strong enough stand against spending cuts, and the Federal Reserve could have done more to support growth. But most of the blame for the wrong turn we took on economic policy, nonetheless, rests with the extremists and extortionists controlling the House.

Things could have been even worse. This week, we managed to avoid driving off a cliff. But we’re still on the road to nowhere."

Odd. And all this while I thought that Obama controlled both houses of Congress during the first two years of his administration.

Spending is the answer? In the same manner that the federal government spent some $600 on a federal health care exchange for Obamacare, which "was built using 10-year-old technology that may require constant fixes and updates for the next six months and the eventual overhaul of the entire system" (http://www.usatoday.com/story/news/nation/2013/10/17/health-exchange-week-three-start-over/2995989/)?

It turns out that the amount spent by the Department of Health and Human Services (HHS) to create the federal health care exchange is far more than double the amount spent by Apple to develop the iPhone (see: http://online.wsj.com/news/articles/SB10001424052702304384104579139461596987366).

Does Krugman truly believe that the economy would be much improved if the HHS had significantly increased its spending on parties conferences in 2012, which amounted to $56 million for 135 conferences (see: http://freebeacon.com/hhs-spent-56-million-on-conferences-in-2012/)?

But what the heck? Who gives a darn about federal government profligacy and inefficiency? Maybe some of whatever additional money that might have been spent over the past five years by the Obama administration, resulting in unsustainable US national debt of $17 trillion, would have given a necessary shot in the arm to the economy . . . not.

Sorry, Paul, federal government spending is not the answer.

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