I previously observed how Paul Krugman recently argued that the U.S. government must not cut spending and balance the budget because running up endless debt that can never be repaid is good for the economy. You can go read what he said for yourselves, but that’s it in a nutshell. The insanity continues. A New York Times editorial criticizes Obama for saying:
Also to put our economy on a stronger and sounder footing for the future, we’ve got to rein in our deficits and get the government to live within its means, while still making the investments that help put people to work right now and make us more competitive in the future. As I mentioned, we’ve had some good meetings. We had a good meeting here yesterday with leaders of both parties in Congress. And while real differences remain, we agreed to work through the weekend and meet back here on Sunday.
The sooner we get this done, the sooner that the markets know that the debt limit ceiling will have been raised and that we have a serious plan to deal with our debt and deficit, the sooner that we give our businesses the certainty that they will need in order to make additional investments to grow and hire and will provide more confidence to the rest of the world as well, so that they are committed to investing in America.
Taking up Krugman’s argument that cutting spending will result in loss of jobs in the public sector and apparently presuming that factor overrides all other considerations, the Times editors say “It is hard to understand … why Mr. Obama has adopted the language of his opponents in connecting the economy to the debt.” Thus the Times criticizes Obama for suggesting there will need to be budget cuts and that the government must get the deficit under control, saying “pulling hundreds of billions of dollars out of the economy at precisely the moment when the spending is needed most”. Moreover, the Times blames Republicans for opposing the “federal stimulus program” that “ended too soon”.
Connecting the economy to the nation’s debt? How absurd! Everybody knows the U.S. economy has absolutely nothing to do with it’s enormous debt! Everybody knows that in times of economic trouble, more government spending, not less, is the answer! Everybody knows that going even further into debt is the key to getting a troubled economy going. Everybody knows that the government can juts borrow more money to pay off its debt, that the Federal Reserve can just print more money out of nothing to “stimulate” the economy!
What’s that you say? We are burdening future generations with an enormous debt burden and destroying our children’s future by massing a debt that can never be repaid? Nonsense! Such foolishness! Don’t be ridiculous.
What’s that you say? The Fed’s “quantitative easing” economic “stimulus” program hastens the decline in the value of the dollar, resulting in a loss of buying power and effective decline of real wages for those who actually have jobs? Rubbish! Such absurdity! Don’t make me laugh.