Heritage Foundation: An Open Letter to Paul Krugman

Closing words:

So, Paul, I strongly urge you to engage me from this point on in serious policy debate. This is perhaps a tall request to make of someone whose recent column “Let’s Not Be Civil” is filled with hysterical demagoguery. You and I will likely never agree about the way the economy works, but an intellectually honest debate between us could encourage someone whose views really count to solve the big policy problems that you and I have frequently agreed are grave dangers to the future of this country.

Sincerely,

Bill Beach

Director, Center for Data Analysis

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Shame on Paul Krugman

But Krugman being Krugman, he attaches defense of the dollar to a desire among white people to "build a bridge to the 19th century"; meaning the "grand" old days of slavery. Shame on Paul Krugman for taking such a vicious and unfounded stance, and shame on the New York Times for giving a truly unhinged man such an influential perch from which he can spew such nonsense.

Paul Krugman Pulls the Race Card from the Deck's Bottom

The truth about the Arizona gunman

Like Drudge says, AZ SHOOTER: BUSH HATER (New York Times)

AZ SHOOTER: Left-Winger JARED LOUGHNER – He Likes Watching US Flags Burn & Favorite Book is Communist Manifesto

Lest you be fooled by fools (like Paul Krugman):

GatewayPundit sets everyone straight: Jared Loughner was definitely NOT a tea partier!

UPDATE: From THE NEVILLE AWARDS

...an enfeebled economy for years to come

Today, Obama is following a script eerily similar to the one followed by Hoover and FDR: He wants to spend wildly, raise taxes on all Americans, erect trade barriers and protect unions, his biggest supporters, to boost their wages at others' expense.

The only difference this time is the Fed has refused to let the money supply contract by a third, as it did during the Depression, deepening the economy's collapse.

The hole in which we find ourselves is the result of bad policy responses to a short-term financial crisis. We'll pay for it with an enfeebled economy for years to come.

And if, as Krugman believes, we are about to enter a global depression, it's only because our policymakers were foolish enough to take his advice.

Paul Krugman's Depression

Whatever happened to the Depression?

By Allan H. Meltzer

Day after day, economists, politicians and journalists repeat the trope that the current recession is the worst since the Great Depression. Repetition may reinforce belief, but the comparison is greatly overstated and highly misleading. Anyone who knows even a bit about the Great Depression knows that this is false.

The facts we face today are very different than the grim reality Americans confronted between 1929 and 1932. True, this recession is not over. But it would have to get improbably worse before it came close to the 42-month duration of the Great Depression, or the 25% unemployment rate in 1932. Then, the only safety net was the soup line.

The current recession is also much less severe than the 1937-38 Depression. A more accurate comparison is to the 1973-75 recession...

And why has the Obama administration been so invested in telling us this is as bad, or close to as bad, as THE GREAT DEPRESSION?

Reason #1:

The Obama administration wanted to make it appear as though it saved us from an incipient disaster, so it overstated its achievements. The White House also wanted to foist its huge "stimulus" program on the country in order to redistribute income. That pleased many Democrats, but did very little to restore growth.

Reason #2:

Then there are economists who would like to see government take a larger role in the economy. They've chosen to use the recession as a pretext for arguing for this change

Think "Keynsian" ... "Paul Krugman" ... "IMF" ... "financial press" ... "Federal Reserve" ...

The Federal Reserve also shared this Keynesian viewpoint. It provided unprecedented monetary stimulus, increasing the monetary base by more than $1 trillion. Much of this increase corrected for its major mistake: allowing Lehman Brothers to fail. After 30 years of bailing out almost all large financial firms, the Fed made the horrendous mistake of changing its policy in the midst of a recession. That set off a scramble for liquidity and heightened the public's distrust in the market.

This had world-wide repercussions. For four months, many financial markets remained frozen and real activity collapsed. Allowing Lehman to fail without warning is one of the worst blunders in Federal Reserve history. Extrapolation caused many market participants to conjecture that we were in a depression. The New York Times and others piled on, speculating foolishly about the end of capitalism.

Now, with recovery in sight, we need to ask what kind of a recovery to expect and what kind of policies are appropriate.

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When the New York Times bashes Obama (multiple times today) you KNOW we are all doomed

...and take note that the liberal darling economist Paul Krugman thinks that Geithner's plan will fail. We are in a shitload of shit, folks and "I told you so" does not even begin to make it all better.

The leading liberal voices of the New York Times editorial pages all criticized—and, in some cases, clobbered—President Obama on Sunday for his handling of the economy and national security.

It's not unusual for Barack Obama to take a little friendly fire from the Times. But it's perhaps unprecedented for him to get hit on the same day by columnists Frank Rich, Thomas Friedman and Maureen Dowd—and in the paper's lead editorial. Their critique punctuated a weekend that started with a widely circulated blog post by Paul Krugman that said the president’s yet to be announced bank rescue plan would almost certainly fail.

The sentiment, coming just two months after the president was sworn in, reflects elite opinion in the Washington-New York corridor that Obama is increasingly overwhelmed, and not fully appreciative of the building tsunami of populist outrage.

Read the whole thing!

The New New Deal

One reason the Depression lasted until World War II, as Paul Krugman argued this week in the New York Times, is that the New Dealers sabotaged their own plan.

With one hand the New Dealers gave, spending to stimulate the economy. In fact, they put through the same kinds of infrastructure projects that Obama and congressional Democrats are considering today.

With the other hand the New Dealers took away, by raising tax rates -- just as the new president and Congress are likely to do in 2009.

Especially damaging to the prospects of recovery were the heavy levies of the second half of the 1930s, which, as Krugman points out, were key in ``precipitating an economic relapse that drove unemployment back into the double digits.'' President Franklin D. Roosevelt specialized in persecuting the rich via taxes, telling the upper class, point blank, that they had ``met their master.''

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