WE are listening, and we're not the ones who need to hear it.

After all just look at the stock market and the profits all the corporations are making.

I mean, Paul. You're our only hope.

We are lucky to have him.

We'd be luckier if anyone in power gave a crap about what he says.

Reaganomics.. Supply side.. Voodoo Math.

32 years of FAILURE.. and we still acknowledge Reaganomics as the leading economic plan.

32 Years.. how much more will it take to convince them that this is a FAILURE?

It has consistently and substantially enriched the people it was intended to enrich, so you can see why they'd want to maintain it.

A depression. He's right, we do need to follow FDR. Hope the administration starts listening.

All it's finance people came from these places, that's who they listen to. Obama is not a liberal and never has been - that's just his election face. Once the election is over and IF the crazies don't win - we will see the culmination of the debt talks that Obama wanted in the first place. In other words, bye bye SSI, Medicare, NlRB, any/all regulation of Wall St. and Bush tax cuts made permanent AND he'll say he doesn't like it but had no choice those mean Repugs made him do it!

The problem is, he's still 100% better than the alternative. We are so f#d.

Better than the alternative but definitely horrible.

Thank you Prof. Krugman.

depression. The problem is, he would slash social spending and explode defense spending. Classic Republican Keynesian economics, though they claim to hate Keynesianism.

The New Deal had nothing to do with it as far as they are concerned. If the same amount of money spent on the war had been spent on domestic programs, would the depression still have ended? What else could the government have spent money on?

The engineers say the US has a backlog of $2.3 TRILLION of infrastructure that needs repair and replacement.
I'm sure that it wasnt much different then.

NOW we should declare a war on global warming with a 100% green energy goal in 10 years minimum. Green energy, High-speed rail, infrastructure, education.

But well probably go to war with Iran instead. Gotta keep feeding the MIC. It's the only sector unaffected by the global downturn. A real growth industry!

It's really so simple. Obama just needs to articulate a vision (which he has already done) and then follow through (which he's been half hearted about). Here it is:

Spend/invest government money into energy: renewable energy, energy efficiency, installing energy efficient lighting, energy efficient HVAC, large solar panel installations, etc. Some of this is kind of happening, but it's not being highlighted or pushed hard enough. It creates jobs. It makes the environmentalists happy. It should make unions happy. It's like a quadruple win.

on another Krugman thread:

Even Krugman has turned the corner. Call it what it is.

Here's a great quote from fiction, from Stieg Larsson's Män Som Hatar Kvinnor (aka The Girl with the Dragon Tattoo) that might be appropriate here. In the story, the Swedish Stock Market is tanking and the main character is telling a journalist the difference between the economy and the stock market.

Thanks for the thread, kpete.

...too bad those in Congress won't LISTEN.

http://borderlessnewsandviews.com/2012/05/the-gop-seinfeld-woody-allen-and-the-case-against-austerity/

I still feel like Keynesianism is a guilt-over-debt-ridden version of Modern Monetary Theory, but anything that pokes hole in the laughable, supply-side-only, neo-liberal economic models is welcome. Especially if it comes from a winner of the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

"and that somebody has to be the government"

He needs to support this when he runs with this line. For starters, lets ignore that not ALL spending has been pulled back. Where does one entice additional spending, IF we don't assume the Government is the pocketbook of last resort?

I have some ideas on those sources, some of which might make people uncomfortable because some involve foreign investment, and that will require collateral, but why not private groups that, say, purchase several urban sprawl properties, raze the houses off them, and build a single, high-value home on a larger piece of property? There you get some construction spending, and some under-valued properties off the market. People with large sums of money are still buying homes. Urban sprawl sets back mass transit and other urban population-density related issues. This sort of economic downturn is an opportunity to leverage the market to reverse that, and get more people concentrated into the cities, so Metro can turn a profit, that Sound Transit can turn a profit, that we can get ridership levels that will support more light rail, etc.

So while I don't necessarily disagree with Krugman, (and in fact, I think he was particularly relaxed and approachable here, had some good comments) it is vital that when he makes a statement like "and that somebody has to be the government", that he support that. At the least, with an idea of just how deep the government's pockets can be, if needed, and at what cost, as well as, how shallow everyone else's pockets are, and that there is nothing beyond monetary policy and the treasury to leverage.

If I sat down and tried to explain this to my mom, and I skipped over that line without explaining it, all my time explaining everything else would be wasted, because she'd want to know the answer to that question. And my mom is NOT an economist.

Ummm...I'm thinking that, if there's a reasonable profit to be had, then someone with the money would be doing this already. So that means they would need "incentive," which is, to me, code for skewing the tax regime in favor of the wealthy. Another way to look at the "incentive" is as some kind of government spending (at the very least, foregone taxation or some kind of risky guarantee), and we're back to the government spending money, but instead of going directly to the middle class, the rich get a cut.

Operationally, there is very little that can be achieved through legislation to shift either the domestic or external sectoral balances, especially when we are looking at over US$1 trillion worth of demand shortage. A higher level of inflation would, at least, spur dis-saving, which would help put people to work. But the simplest way to achieve that is for the government to spend money non-productively (and not on buying back Treasuries...that's just an exchange of government liabilities). Productive spending, on the other hand, would directly stimulate GDP and employ idle labor, leading to a direct and immediate improvement in unemployment (something the GOP is loathe to see before the election) without significant increase in inflation. The likely result of increased government sector net spending is somewhere between these points - some inflation, but not as much as is possible.

but when will the people who need to hear this pay attention?