Memo to: President Barack Obama
Subject: NYTimes/Princeton’s Paul Krugman was right three times
Dear Mr. President
We regret to inform you that Paul Krugman was right three times.
First he was right about the size and targeting of the stimulus funds.
JedReport, June 2010 – Stimulus Spending: Paul Krugman was right – it was not nearly enough
BusinessWeek – the physics behind economic stimulus in recessionary times
Second, Dr. Krugman was right about the jeopardy associated with TBTF-Too Big To Fail banks
Washington Report – breakup the TBTF banks to stop their domination of the political process
AmpedStatus – Why we must break up the TBTF banks now
Third, Krugman was right about the Republicans willing to hold you hostage on economic negotiations
Pittsburg Post+Gazette December 2010 – Obama held Hostage
Yet I remain deeply uneasy — not because I’m one of those “purists” Mr. Obama denounced Tuesday but because this isn’t the end of the story. Specifically: Mr. Obama has bought the release of some hostages only by providing the GOP with new hostages.
About the deal: Republicans got what they wanted — an extension of all the Bush tax cuts, including those for the wealthy. This part of the deal was bad all around.
Yes, some of those tax cuts would be spent, boosting the economy to some extent. But a large part of the tax cuts, especially those for the wealthy, would not be spent, so the tax-cut extension increases the budget deficit a lot while doing little to reduce unemployment.
Sir, about the Republicans. The only thing uniting the GOP party is their collective visceral need to obstruct, humiliate, and destroy you. Rendering your possibility of a second term a moot point. You are holding an otherwise fragmenting Republican party together. You might want to take that into account when … uhhh “negotiating” with them.
Finally, with the debt deal the Republicans have absolutely removed all your room to maneuver on targeted job creation as opposed to sailing out another Bernanke inspired Queen Elizabeth Wall Street Cruise. So expect the Wall Street downturn to continue until the Street gets the GOP to cry Uncle and do something about 70% of US Consumption – Consummer Jobs, Income and Spending.
Jeff Reeves, Marketwatch – 5 Ugly truths about life After the Debt Deal
247Wall Street – 10 reasons why to panic about the markets
Both reports conclude The Deal leaves no room on Jobs and therefore see dim chance of recovery.
As I understand there may be Treasury Secretary position opening up … and the Economics team is badly depleted….hint, hint.
Yours Truly,
John Q.P.
PS: Here is Paul at least being consistent, but you may want to do a Hillary and throw him a bone lest he become Washington’s male Economic Cassandra.