In case anyone was wondering (though that would require someone to actually be reading these), I am attempting to title all my blog posts with song titles. We’ll see how long this lasts…
In today’s New York Times, Paul Krugman argues that, in regards to the stimulus package, “It’s much too soon to give up on policies that have, at most, pulled us a few inches back from the edge of the abyss.” Krugman’s point is that we should continue with our current spending and monetary policies rather than worry about balancing the budget. If not, we’ll plunge back into recession.
Krugman is a brilliant economist, and we should carefully weigh his concerns; however, it is disconcerting that there is no direction to the stimulus. The administration is not even clear on how much stimulus money they’ll spend in the coming months. And we can forget about ever getting a straight answer on whether these policies are helping to “create or save” jobs.
It is a stretch to somehow equate the “stimulus” with actually stimulating the economy. Congress gave the Administration $787 billion for the stimulus and then passed a $3.6 trillion budget. This is not to mention our ownership of General Motors. Yet despite all this spending, Americans are still losing jobs at a rapid pace.
As Eric Cantor wrote in a New York Daily News op-ed today:
“When he took the reins of government, President Obama faced a choice. Would he change the ways of Washington and make the tough decisions that all Americans understand are necessary to return America to long-term growth and fiscal sustainability? Or would he lead under the guise that massive spending binges equal meaningful reform? So far, the administration has chosen the latter, kicking the hard choices down the road. President Obama has proposed policies that will accumulate more debt than was amassed by all previous Presidents over the past 220 years. … With the national debt projected to more than double in the next 10 years, the President isn’t merely mortgaging the future of the young voters who supported him. He is putting all of us at risk of drowning in inflation.”
The Administration is haphazardly throwing money at a problem and accumulating debt for taxpayers. Krugman is right that we still risk slipping into a depression, but digging a deeper hole isn’t the solution.