"We're Not Japan"

Paul Krugman, a pretty loyal Barak Obama cheerleader, is getting pretty perturbed in a New York Times op-ed today with recent talk from the administration about reducing the national deficit. I am with Krugman on both points; his liking for Obama and his frustration at Obama’s recent focus on deficit reduction. Well, I actually am in favor of deficit reduction, but for God’s sake, not now.

Krugman’s problem is that he seems not to understand “popular political thinking” methods. I don’t either, of course, I think they are idiotic, but I recognize that Paul and I are not going to defeat them with logic. Paul keeps trying to defeat them with logic. Hmm, so do I, come to think of it.

It takes him several paragraphs to reach the point that he thinks that Obama is getting his economic views from Wall Street, which leaves me rather at a loss for words. Oh, really? Has Paul noticed who the Secretary of the Treasury is? Or, perhaps, who the President’s Chief Economic Advisor is? “…getting his advice, directly or indirectly from Wall Street.” Really, Paul, you think?

He then goes on to say that, “A better model, I’d argue, is Japan in the 1990s, which ran…” Well, read it for yourself; it's about interest rates.

The argument against that, Paul, is simply, “We’re not Japan.”

I know that doesn’t make sense to you, Paul; it doesn’t make sense to me either, and it probably doesn’t make sense to the people who use it. That doesn’t keep them from using the argument. That’s where you and I diverge from politicians, Paul, we require that our arguments make sense.

Remember the health care issues; we reject the European model because, “We’re not Europe.” Not because of any of the features of that model, or any of the constructs of our society versus that society; we simply make the argument, “We’re not Europe,” case closed.

So, economically, “We’re not Japan,” and your goose is cooked. Move on, which he does with this silliness,

Still, let’s grant that there is some risk that doing more about double-digit unemployment would undermine confidence in the bond markets. This risk must be set against the certainty of mass suffering if we don’t do more — and the possibility, as I said, of a collapse of confidence among ordinary workers and businesses.

Oh, how hysterical. He is comparing the interest of the bond market to the “mass suffering of unemployment.” Let’s run that past the laugh meter one more time; the bond market weighed against “ordinary workers and businesses.” Do you really think there is any contest there, Paul? Whether Obama cares or not, and he might, do you really think Congress does?

And he closes with the truism about it being, “much riskier to do too little than it is to do too much,” which may be true in economics, but is death in politics. The public, and a politician’s opponent, will always ignore what a politician didn’t do. Any action, however, whether taken for good or ill purpose, will be used against you in your next campaign.

Brilliant at economics, Paul Krugman is no politician.