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SUNDAY, NOVEMBER 22, 2009
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 OPINION 
23

We're Doomed Without Another Stimulus: Krugman

Jobs report offers scary echoes of 1930s stagnation

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(Newser) – Yesterday's grim jobs report is the clearest sign yet that the US desperately needs another fiscal stimulus, writes Paul Krugman in the New York Times. This is 1930s redux: a Democratic president has pushed through an insufficient program, while strapped state governments cancel out federal spending with their own budget cuts. If President Obama doesn't act, he'll be facing his "personal 1937."

Further stimulus won't be easy. Republican leaders are united in opposition, "unconstrained by facts or logic," and Krugman's fellow economists are "recycling old fallacies" about the dangers of public spending. Obama's team, particularly Council of Economic Advisers chief Christina Romer, has a good understanding of the dangers of repeating the 1930s. "What I don't know," writes Krugman, "is whether the administration has faced up to the inadequacy of what it has done so far."

Larry Summers, Christina Romer, Tim Geithner and Barack Obama at the White House.
Larry Summers, Christina Romer, Tim Geithner and Barack Obama at the White House.   (AP Photo/Gerald Herbert)
Christina Romer, chairwoman of the Council of Economic Advisers, testifies on Capitol Hill in Washington before the Senate Banking Committee.
Christina Romer, chairwoman of the Council of Economic Advisers, testifies on Capitol Hill in Washington before the Senate Banking Committee.   (AP Photo/Jose Luis Magana, File)
Job seekers line up for a career fair, Thursday, July 2, 2009 in Oak Brook, IL. Employers nationally cut a larger-than-expected 467,000 jobs in June and the unemployment rate climbed to a 26-year high of 9.5%.
Job seekers line up for a career fair, Thursday, July 2, 2009 in Oak Brook, IL. Employers nationally cut a larger-than-expected 467,000 jobs in June and the unemployment rate climbed to a 26-year high...   (AP Photo/M. Spencer Green)
President Barack Obama makes remarks about innovation and jobs, Thursday, July 2, 2009, in the Rose Garden of the White House in Washington.
President Barack Obama makes remarks about innovation and jobs, Thursday, July 2, 2009, in the Rose Garden of the White House in Washington.   (AP Photo/Pablo Martinez Monsivais)
« Prev« Prev | Next »Next » Slideshow

As in the 1930s, the opponents of action are peddling scare stories about inflation even as deflation looms. So getting another round of stimulus will be difficult. But it’s essential. - Paul Krugman

The GOP responded to the latest job numbers by proclaiming the failure of the Obama economic plan. That’s ludicrous, of course; the White House warned it would be several quarters before the plan had any major effects. - Paul Krugman

« Prev« Prev | Next »Next » Slideshow
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23 comments
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IN RESPONSE:
emptycalm
Jul 3, 09 1:13 PM CDT
Uh this is a failure of greedy capitalists, not just the democrats. Were you living under a rock for the past 3 presidents?
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+2
IN RESPONSE:
freethemall
Jul 3, 09 3:30 PM CDT
You don't spend your way out of an economic downturn? We are all agreed that the worst economic downturn in history was the great depression of 1930's and I believe all would agree that this worst economic calamity ended as a result of WWII. Ask yourself why WWII ended the depression. The answer is as plain as the nose on your face. Hugh increases in the amount of Government spending necessary to the war effort. This did cause inflation and rationing, since war materials, not consumer goods were produced. But it did end the depression and it WAS massive government spending.
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+1
NovThird2010
Jul 3, 09 8:19 AM CDT
Hey, Krugman, it is you who are unconstrained by facts or logic, you Obamabot. Two things: 1. There are many economists of the opinion that what FDR did actually prolonged the Great Depression and if WWII hadn't come along, the GD would have continued. 2. How come the first two "stimulus" packages were forced down our throats with threats of doom and gloom, yet Chairman Barry has put precious little of those funds where he said he would? Reply
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-4
IN RESPONSE:
2-bits
Jul 3, 09 1:12 PM CDT
Hey Infidel: It's is you who are unconstrained by the fact that Krugman has a Nobel prize on you. Do you really think he's unaware of the first fact? Also he is hardly an Obama bot, but that shows you haven't been paying attention at all.
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+4
IN RESPONSE:
AClotfelter
Jul 3, 09 3:46 PM CDT
First TWO stimulus plans? WTF?
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