It would be easy to dismiss Paul Krugman's blunt opinions if he wasn't a Nobel Prize-winning economist, and if his warnings about economic and political dynamics hadn't been so consistently accurate, these past several years. While almost everyone else rode the economic bubble, Krugman said it would soon burst. When many praised President Obama's stimulus plan, or criticized it as too large, Krugman warned that it was much too small and that Democrats would pay the price for an inadequate economic recovery. So, given his recent record, it isn't easy to read Krugman's dour thoughts of the past few days. But it would be wise to pay heed.
Of Alan Simpson's recent statement that he looks forward to a blood bath, when the federal government's debt ceiling hits, next April, Krugman writes:
There’s a legal limit to federal debt, which must be raised periodically if the government keeps running deficits; the limit will be reached again this spring. And since nobody, not even the hawkiest of deficit hawks, thinks the budget can be balanced immediately, the debt limit must be raised to avoid a government shutdown. But Republicans will probably try to blackmail the president into policy concessions by, in effect, holding the government hostage; they’ve done it before.
Now, you might think that the prospect of this kind of standoff, which might deny many Americans essential services, wreak havoc in financial markets and undermine America’s role in the world, would worry all men of good will.
But the co-chair of the Catfood Commission is not a man of good will, and as Krugman notes, it is the Republicans' goal to make government ungovernable. Fed Chairman Ben Bernanke is asking for a new fiscal program, but Republicans don't want to help with unemployment, they demand that the budget-busting Bush tax cuts be extended, their approach to rising Medicare costs is mere demagoguery, and they even oppose aid to small businesses. As long as a Democrat is in the White House, their goal is to destroy the economy. And while unemployment remains dangerously high and the job market remains dangerously depressed, they even oppose again extending unemployment benefits. They won't help create jobs and they won't help those who want jobs but can't get them. They don't care about the suffering of working people. They see it as but a means to political control.
While the president still discusses the chimera of bipartisanship, Krugman thinks most Americans don't realize what's happening, and that they somehow still believe elected officials will come together and do the right thing. But Republicans won't. And the hardship and suffering in this nation are going to get worse. Much worse.
It’s hard to see how this situation is resolved without a major crisis of some kind. Mr. Simpson may or may not get the blood bath he craves this April, but there will be blood sooner or later. And we can only hope that the nation that emerges from that blood bath is still one we recognize.
The question is whether the Democrats will stand their ground and make their case and at least try to do what's right. The question is whether the Democrats finally understand what they're up against, and are ready to use every political means they have to fight what the Republicans have turned into nothing more than a primal political fight. On that, Krugman also remains pessimistic.
Democrats have suffered for ignoring Krugman these past years. So have the nation and the world. When someone is so consistently accurate, perhaps it's time for people to start listening to him.