Posts Tagged ‘Krugman’

Another Downgrade on the Horizon?

Sunday, October 23rd, 2011

Worse This Time?

Leave it to Bank of America/Merrill Lynch to publish their fears of another credit-rating downgrade for the US government.  On Saturday, I brought you the story of how this very company is shifting some of its European derivatives over to its depository arms so that they will be insured under FDIC.  It’s a stunning development that an analyst for this very institution to  tell us they expect another credit downgrade, tells us something about how they believe that will work out for the American tax-payer that will now be on the hook for trillions. They don’t think it’s going to turn out well, I can assure you, but you can expect all sorts of hand-wringing excuses when the meltdown occurs.

In his dire analysis, Ethan Harris writes:

“We expect a moderate slowdown in the beginning of next year, as two small policy shocks—another debt downgrade and fiscal tightening—hit the economy. The “not-so-super” Deficit Commission is very unlikely to come up with a credible deficit-reduction plan. The committee is more divided than the overall Congress. Since the fall-back plan is sharp cuts in discretionary spending, the whole point of the Committee is to put taxes and entitlements on the table. However, all the Republican members have signed the Norquist “no taxes” pledge and with taxes off the table it is hard to imagine the liberal Democrats on the Committee agreeing to significant entitlement cuts. The credit rating agencies have strongly suggested that further rating cuts are likely if Congress does not come up with a credible long-run plan. Hence, we expect at least one credit downgrade in late November or early December when the super Committee crashes.”

Of course, part of the problem is that everybody is waiting for the other shoe to drop.  Europe stands on the verge of a complete meltdown, and our Federal Reserve has gotten us so deeply tied to the success or failure of Europe at this point that if Europe goes down, we will likely fall down too.  Several outlets are reporting that a number of European banks are on the brink, and that this will trigger a sell-off and panic unlike anything we’ve seen in a long time.

At the same time Germany’s Angela Merkel is chastising Italy over its debt of 120% of GDP, I wonder if she’d do us a favor and look at the US, which isn’t far off from that ratio itself, and tell Obama a thing or two while she’s at it.  Merkel is among those who are urging further austerity measures, and she’s right. The trouble is that leftists never tire of pitching their best Keynesian plans at these sorts of problems, pretending that if only they can borrow and print a little more liquidity, the problem will solve itself.  Naturally, that’s nonsense, and while everybody knows it, the spenders will never, ever admit it.

Ladies and gentlemen, we stand on the precipice and wonder why this is happening, but anybody who has ever learned the hard lessons of running on credit must begin to see the simple truth of the matter:  You cannot consume more than you produce on an indefinite basis.  This entire fiasco is the result of runaway governments spending our future into oblivion.  While we’re at it, we must also rein in the Federal Reserve as the policies now in force are merely multiplying the trouble.  One year ago, as they began to plan out QE2(Quantitative Easing, Round 2,) Sarah Palin warned the world.  She was mocked by Krugman, the purveyor of Alien Attacks and other nonsense dressed up as economics, while she was being berated for her stance by a host of others, but in the end, who has been right?  We mustn’t permit ourselves to suffer under this comfortable illusion any longer: There is no alternative but to dramatically slash government spending.  We must do it now, or there may be no tomorrow.

The Nobel Prize for Partisan Vitriol

Sunday, September 11th, 2011

Hiding from the Storm?

You might think that on a solemn occasion such as the 10th Anniversary of the September 11th attacks, for once, the left would be able to set aside their campaign of destruction against all things American.  Sadly, you’d be wrong in so thinking.  Paul Krugman couldn’t restrain himself, and in blustering,  irresponsible rhetoric, the reckless and obtuse NY Times columnist is at it again.  Not satisfied that Americans will remember the horrors of that day from the perspective of witnesses, and unwilling to accept the clear association between the radical left and our enemies that he helped to foster as an exemplar and prototype, on this 10th anniversary of those horrendous events, Krugman launched yet another attack at those to whom the nation turned on that day for leadership, and who answered the call.  On that day, we Americans stood transfixed by the events unfolding in New York, Washington DC, and in a field in Shanksville, PA.  As we did so, Mr. Krugman was already formulating his response in the form of further attacks in opportunism at the earth-shattering event.

Today, as then, Krugman remains a staunch anti-capitalist who never fails to be wrong about our country, its people, and its economic and political system.  On Sunday, September 11th, 2011, he offered this:

September 11, 2011, 8:41 am

The Years of Shame

Is it just me, or are the 9/11 commemorations oddly subdued?

Actually, I don’t think it’s me, and it’s not really that odd.

What happened after 9/11 — and I think even people on the right know this, whether they admit it or not — was deeply shameful. Te atrocity should have been a unifying event, but instead it became a wedge issue. Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.

A lot of other people behaved badly. How many of our professional pundits — people who should have understood very well what was happening — took the easy way out, turning a blind eye to the corruption and lending their support to the hijacking of the atrocity?

The memory of 9/11 has been irrevocably poisoned; it has become an occasion for shame. And in its heart, the nation knows it.

I’m not going to allow comments on this post, for obvious reasons.

Obvious reasons, indeed!  Mr. Krugman may have no desire to read a response to this partisan attack, but that hardly means he won’t receive one. “Shame,” Mr. Krugman?  The shame to be felt on this day should come in the form of your own guilt. Only three days after the tragic events of 9/11/2001, Krugman himself was seeking to capitalize on the horrors of that day:

“These aftershocks need not be major. Ghastly as it may seem to say this, the terror attack — like the original day of infamy, which brought an end to the Great Depression — could even do some economic good. But there are already ominous indications that some will see this tragedy not as an occasion for true national unity, but as an opportunity for political profiteering. “

This is just a sample of Mr. Krugman’s perpetual indecency.  As you will remember, I’ve recently covered Mr. Krugman’s apparent wish for a war, or an alien invasion, to rescue us from our economic crisis.  In typical fashion, Mr. Krugman decries political motives while spending the space of his short diatribe discussing little else.

A mere five days after the horrors of that day, while emergency workers still struggled in hope to find somebody, anybody alive in the wreckage, Mr. Krugman began to assign blame.  As ever, Mr. Krugman blamed America and Americans for failing to be taxed enough to pay for national security. On 9/16/2001, he wrote:

“Right now most Americans are focused on punishing the perpetrators. But Tuesday’s tragedy was partly self-inflicted. Why did we leave ourselves so vulnerable?

“For this is a tale not just of villainy, but also of penny-pinching that added up to disaster — and a system that encouraged, even forced, that penny-pinching. It’s a problem that goes beyond terrorism. Something is amiss with our political philosophy: we are a nation that is unwilling to pay the price of public safety.”

If you’re astonished that Mr. Krugman could so easily blame America, consider that in his bankrupt world-view, the victim is always to blame.  In another perverse inversion of right and wrong, Krugman reveals his real motive: He wanted to use the occasion of the horrors on 9/11 as the pretext to raise taxes on the American people.  More, he regarded 9/11 much as Reverend Wright, apparently, though in a different context:  The event was merely the return of our chickens to roost.  What sort of monster is it who lurks within a short distance of this spectacle of death and destruction, and first thinks to politicize the event and to urge more burdens on a shocked nation?  Paul Krugman is that sort of monster.

One would think that such a well-known propagandist as Krugman would be careful to cover his own tracks, and not accuse others of doing the things he himself has first done.  Hypocrisy is no impediment to the radical left, and as one of its allegedly mainstream spokesmen, Krugman is no exception.  In an article published on 9/30/2001, he wrote:

“The most vocal hitchhikers are conservative pundits, who within a day of the terrorist attack were urging the administration to use the occasion to ram through tax cuts for the wealthy and large corporations, drilling in the Arctic and so on. This drive reached a sort of climax in the already notorious Wall Street Journal editorial of Sept. 19, which added appointments of conservative judges to the list of goodies the administration should grab while the grabbing is good.” (Emphasis added)

In pointing to a Wall Street Journal editorial of September 19th, Krugman ignores his own editorials published on the 14th, 16th, as well as the 19th in which he sought to use the events of 9/11 to drive home his political and economic agenda.  There’s nothing quite like the pot calling the kettle “black,” and few have been so willing to do so as Paul Krugman.

Mr. Krugman is entitled to his opinions, but not his own custom-manufactured version of history.  Remembering that he is among those who first sought to use 9/11 to political advantage is important, for while he claims in shrill terms today to eschew any form of cashing-in on 9/11, the truth is that he was among the first in print, anywhere, who sought to do precisely that, if only in support of his own preposterous economic policy ideas.  We’re all well aware of Paul Krugman’s status as a Nobel Laureate, but by now we should have realized that rather than in economics, his prize ought to have been in partisan vitriol.  Ten years after the day of such horrors, when most Americans are quietly contemplating all that has been lost, Krugman could not deny to himself the opportunity to take one more shot at President Bush.  He may not want any response published on his own page, but as more Americans realize just who Krugman really is, I scarcely believe he will avoid it.

Note: For your Sunday reading, you may wish to consider another form of remembrance in which Stella Paul at American Thinker explains how today’s left is still tied to the tragedy of 9/11:  Obama and Our 9/11 Trauma


A Preemptive Strike Against the Obama Blame Game

Sunday, August 28th, 2011

The Mad Scramble for a New Excuse

It’s already begun. Barack Obama and his shills in the media, no longer credibly able to blame the Tea Party or Sarah Palin for the weak economy, have a new scapegoat for their poor performance: Hurricane Irene. In an article on Sunday in the Mail Online, we are told that the economic hit to New York could trigger a double-dip recession. This is the excuse, but before we accept this barrow-load of horseapples, we should instead refute them with their own previous, pathetic propositions.  Aside from the plain fact that we’ve been sliding into a deeper recession for months, there is another reason to reject this latest narrative, and it comes not from some advocate of the Austrian school of economics, but instead from the pages of their very own apologists for failed Keynesian policies.

I’ve covered this before, but ladies and gentlemen, it’s time to remember that champion of Obamanomics, that Nobel Laureate with tremendous imagination and no shortfall of excuses, that propaganda-spewing weasel of epic proportions:  Paul Krugman of the New York Times.  You may remember just a short few weeks ago, I took Krugman to task for his Keynesian proposition that if only aliens were to arrive, it would generate great economic growth and activity.  What Krugman was really proposing is the notion that a war might do our economy some good.  It was Krugman’s postulate that by gearing up for war, and spurring new production, the economy would be boosted.  While the notion is really absurd in most respects, I now feel compelled by events to throw it right back in his face.  After all, won’t the damage wrought by Hurricane Irene also spawn more production?  Won’t this tend to reverse the results of any deleterious effects of the hurricane itself?  According to that bastardized Keynesian logic Krugman so dearly loves, this should represent an economic growth opportunity rather than a calamity.

I am certain that once Krugman and the Obama-drones get wind of this article, they will immediately retract, or somehow attempt to differentiate.  They’ll tell us “but a War is man-made, and not an act of nature.”  Fine, if you’re foolish enough to believe that, but then what of “aliens attacking?”  Certainly that is not man-made, but simply an act of nature, right?  As they will spin and flail to find some way to tie the economic tidings to anything and anyone other than Obama, they will concoct every manner of reason why this hurricane is somehow different from their previous statements on the opportunities presented by disasters.

According to their broken logic, this event should be more stimulative than harmful, and it’s a wonder that despite the Lamestream media’s sycophantic, slavish regard for Mr. Obama, nobody even on the center-right side has caught onto this theme.   It’s pathetic.  Here we have the perfect demonstration of reality, and the negative economic effects of a natural disaster, and it is a perfect example of Frederic Bastiat’s famous economic thesis: That Which is Seen and That Which is Not Seen.

It’s also known as the Broken Window Fallacy. A brief few minutes in study of the concept actually refutes everything they have wished to tell you about stimulus, but it’s worth noting that they haven’t admitted this, so we ought not now allow them to claim it as the excuse for an economy that is already tanking.  Take a look at the video:


While this fundamental concept of economics clearly applies to this or any other hurricane or “alien invasion,” still this is not what their economic apologists like Krugman predict.  I think it’s high time that we insist that they either admit that Keynesian stimuli are part of a broken philosophy, or that they stand by that philosophy and proclaim the problems wrought by Hurrican Irene as an opportunity.  Either way, their philosophical goose is cooked.

Of course, unless we make it abundantly clear, they’ll succeed in blaming an economy well on its way over the precipice on the hurricane, but you and I both know this is a nonsensical claim.  Our economy has handled hurricanes without falling into economic crisis before, and what they’ll offer is that this makes a bad situation worse.  We must not permit them that argument without demanding they likewise discard the previous argument about the stimulative effects of  government spending on war, natural disasters, and aliens attacking.  It’s a fraud, and withe the Mail Online article pointing the direction to their next deceitful excuse, I think it’s time we made a preemptive strike of our own.  They can’t have it both way, unless we permit it.

The Aliens Have Landed

Tuesday, August 16th, 2011

Praying for Aliens or War?

There was a time when a Nobel Prize meant something.  Paul Krugman is a Nobel Laureate in the field of economics, but he’s most well-known for his economic propaganda on behalf of leftist ideas. He appeared on Fareed Zakaria’s show to propose the preposterous, meanwhile making an admission that is not only damaging to his long-held Keynesian notion of “pump priming,” but also inadvertently destroys the leftists’ notion of how the U.S. finally clawed its way out of the Great Depression.  Krugman has argued that the United States was able to climb out of the pits of depression by the massive stimulus spending of FDR.  FDR’s many make-work programs and vote-buying schemes like the CCC and WPA jobs seem suspiciously like the ideas President Obama is now proposing.

Krugman explains that if we were invaded by aliens, the stimulative effect would get us out of the prevailing pathetic economic environment of the moment.  Unfortunately, what he’s also saying is that a war would be good for the US economy, and once again, he misses the mark entirely.  What lifted the US out of the Great Depression was when we began to supply England and Russia, among others, with the materials of war in 1939 under the Lend-Lease Act.  We would not actually enter the war ourselves until more than two years later, and so in effect, the US was growing its economy on the basis of war-time production without yet being in a war. This is what got the US out of the Great Depression, but the problem is that we needn’t have a World War erupting in order to bring us back from this brink.


All of this admits of something leftist stooges in the economic propagandists’ press like Mr. Krugman have long denied: The big government programs of Franklin D. Roosevelt did approximately nothing to recover the U.S. from the Great Depression.  As late as 1938, Roosevelt was concerned he might even lose Democrat Party control of Congress, because the number of unemployed in the country was then higher than it had been in 1933 when he had been inaugurated.  This is because, as I’ve detailed elsewhere, there is no way to create lasting demand with borrowed money.  At the time, Treasury Secretary Henry Morgenthau complained bitterly that they had discovered the weakness of Keynesian notions in testifying to the House Ways and Means Committee:

“We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong…somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises…I say after eight years of this administration we have just as much unemployment as when we started…And an enormous debt to boot!” (Morgenthau Diary, May 9, 1939, Franklin Roosevelt Presidential Library)

Consider what this demonstrates:  In 1939, our government already knew Keynesian “pump-priming” was nonsense, and still, after all the years between, with all the evidence necessary to demonstrate the facts, commencing in early 2009, the Obama Administration decided to start again that practice which history had already condemned as a failure.  There was Paul Krugman, Nobel Laureate, urging  his recently-minted fellow Nobel Prize winner Barack Obama to carry on where FDR and the New Dealers had stopped.  Among all the other things this may lead you to wonder, the value of a Nobel Prize may now rightly be questioned.

In his commentary, Krugman admits borrowing a plot in which scientists fake an impending alien threat to achieve world peace.  Let me assure you that you cannot fake prosperity, and of all the lessons of the last century, this idea ought finally to be discarded.  Mr. Krugman is another economic propagandist, because what he does not mention is that the reason the US was able to prosper on the sales of war materials prior to entering the war was precisely because we enjoyed a competitive advantage among the producers of war goods at the time.  We had vast, untapped resources of workers and raw materials that could quickly be turned into the equipment fighting men around the world needed to go into battle.  Unless we happen to have some  particular weapon more able to repel aliens, or are able to deliver it to customers more inexpensively and reliably than our competitors, and unless the aliens decide to leave the U.S. alone for a while as they plunder the remainder of the globe, it is not possible to understand how Mr. Krugman’s fanciful suggestion bears any relevance on the reality under which we now suffer.

Perhaps rather than accost Americans with fantastic ideas about how war can rescue us from ourselves, Mr. Krugman can instead try his hand at real economic ideas that have withstood the tests of time, because his own have not, and he knows it.  Mr. Krugman was among the number of Lame-Stream Media critics who last year pilloried Sarah Palin for her specific warnings about QE3, and we all know how that came out: As she predicted, food and energy prices have ratcheted up, and Americans are suffering from a rapidly devaluing dollar.

Now the left’s chief economic propagandist, apart from President Obama, is telling us that a World War of some sort would be good for the economy.  How many of you now wonder if this portends a grave future?  When your leaders consider advice that offers aliens or World Wars as the solution to your economic woes, you have every reason to be concerned.  These people are not interested in right or wrong, but only in victory at all costs.  I would urge my fellow Americans to observe with a shrewd eye the foreign policy machinations and manipulations of the Obama Administration, looking for any evidence that they would seek to use a foreign policy crisis to their domestic political ends.  Given the history of this administration, it’s virtually certain that presented such an opportunity, and given their poor standing with the public at present, there may be no limit as to what they will permit themselves to do.