Paul Krugman has an op-ed today in the New York Times in which he reverts to the form where the brilliant economist writes brilliant ideas so forcefully and with such clarity that anyone reading them who has more than, say, a grade school reading comprehension should react with the thought of, “Oh wow, we should really do that.”
They won’t of course. As with the health care issue, people will say, “Well, that may work for Europe, but we’re not Europe.”
Naturally those people will not have the slightest idea in what way we differ from Europe, or how those differences would prevent what Krugman suggests from working here. They will, however, be perfectly willing to have our unemployment remain above 10% indefinitely in order to prove exactly how “not Europe” we are. Just as they are willing to pay twice as much for health care in order to prove that single payer will not work here, by the simple expedient of not trying it.
I actually like the WPA or CCC idea, and would even be willing for them to wear brown shirts just to watch Glenn Beck foam at the mouth. I am less inclined to favor “employment tax credits” for the simple reason that we have used those in the past and results have been very much less than a success. I have no reason to believe that we would do it any better now than we did then.
I am totally in agreement with Dr. Krugman on the basic point, though, and that is that indirect action is all too prone to be limited to the initial part of the program leaving the second part, the actual goal, unrealized. The idea of “trickle down economics" was to create wealth at the top of the heap and let it trickle down to the working class, and we know how well that worked out. Creating jobs by “growing the economy” is not working, and when something isn’t working the solution may or may not be to do something else, but it sure as hell isn’t to simply do more of what you’re doing.